Imagine that you have just run an RFP and are combing through the numerous responses you have received from potential suppliers. Upon your review you realize that you invited the wrong set of suppliers, and/ or you have not made your goals clear enough - leaving you with mixed responses and confusion on how to proceed with this RFP. You could just run another RFP, right? While that solution may work out in your favor, there is a streamlined process that you can leverage to avoid reacting to late feedback. Enter The RFI: a smart way to gather details prior to running your RFP.
What is an RFI?
Before we dive in, let’s discuss the basics: what is an RFI? A Request for Information (RFI) is a formal request for preliminary information on items or services you are looking to purchase. You can also run an RFI to learn more about new potential suppliers you wish to work with. Typically, the RFI will come before the Request for Proposal (RFP), or sometimes a Request for Quotation (RFQ), as it will help you clarify your requirements. An RFI is an intent to make a future purchase; the final decision to purchase will come with your subsequent RFP or RFQ.
When should you use an RFI?
While running an RFI can lead to a more successful RFP, it is not always needed. That raises the question: When should you use an RFI? Here are some common situations to consider using RFI’s to streamline your process:
Higher levels of of uncertainty
An RFI is run when there is less certainty. If the requirements are unclear, consider running an RFI to gather more details on the items or services you are looking to procure. Once you gain more clarity you will be able to build a stronger RFP that will ask the right questions.
Gain a better understanding of your budget
Do you have a strong understanding of what this item or service may cost you? Running an RFI can help you to better understand the budget you need for this purchase. This will allow you to survey a network of suppliers to better understand the average cost associated.
Source new items and services
Sourcing an unfamiliar category can make it challenging to build a successful RFP. You may not know what you should be asking to end up with a successful outcome. When you start with an RFI you can conduct more general research, and use the supplier responses to help gauge if you have all the information you need to continue the process.
Not ready to commit to a purchase
If you are considering an RFI you may ask yourself, am I committed to purchasing at this time? The goal of an RFP is to make a purchase, and suppliers participating in the RFP will expect to complete a transaction upon awarding. There are a number of reasons why you may not be fully committed to purchasing at this moment, this could include unclear timeline, budget approval, or wanting a better understanding of the category you are sourcing for.
Advantages of running an RFI
1. Save time
Taking the time to construct an RFI prior to an RFP can save you time in the long run. Keep the RFI brief - You do not need to have all of the answers. In fact, if you did you likely would not be seeking to run an RFI in the first place. Building an RFI is more approachable than an RFP because it requires less detail. Consider this a research project, before you build your end result (the end result being the RFP). Make your intentions clear while also remaining open to the idea of shifting your requirements based on the response you receive. Also keep in mind that your RFI may not always proceed to an RFP. Based on the responses you receive you may realize that the project is out of scope, out of budget, or your requirements need to be reworked before you can move forward.
💡 Fairmarkit Tip: Fairmarkit allows you to review your RFI responses and record the end result of the event for easy history logging. Think of this as your RFP “Awarding Reason” but for an RFI.
2. Review responses in an organized manner
One common method of conducting an RFI is email. This method may be sufficient in some cases, but it can make it challenging to stay organized once you receive responses. Using a platform like Fairmarkit allows you to track the progress of your RFI, and compare supplier responses side by side. Reviewing responses side by side can help you identify trends, and arrive at a final decision sooner.
💡 Fairmarkit Tip: Compare supplier responses side by side on the Details page of your event. Once you formally review your RFI, you will be able to refer back to your responses at any time.
3. Gather information outside of your normal procurement needs
By now you have learned that running an RFI in advance of an RFP can lead to more success. It is important to note that RFIs can be used more broadly than that. You can conduct an RFI to learn more about suppliers you may choose to work with in the future. This information can be gathered in the form of a survey or via a compliance questionnaire. The information you gather via your RFIs can help you broaden your business by diving into new categories, expand your supplier base and source new services.
4. Introduce yourself to a new network of suppliers
One benefit of running an RFI is that you have a chance to discover new suppliers. Sure, you probably have your preferred suppliers - but expanding your reach with your RFx events gives you the potential to find better quality, or better pricing to meet your sourcing needs. You can also discover diverse suppliers, allowing you to build a well-rounded network for future sourcing needs. Keep in mind that you should only invite as many suppliers based on your willingness to take the time to evaluate their responses.
Now, you may be wondering, what is in it for the supplier participating in the RFI? For suppliers, this is a chance for them to win over a new customer. The RFI allows them to introduce themselves and market the goods and or services they can provide you.
💡 Fairmarkit Tip: Take advantage of the formatted event description offered in the platform. This will allow you to draft a well organized outline of who you are as a business, and what your ultimate goal is.
For more advice on creating and managing RFx events, check out Fairmarkit’s blog, The Source.
