How and When to Write an RFP
Requests For Proposals (RFPs) are the best way to escape a hostage situation with your vendors.
They give you control over deadlines, quality, product requirements, service and how materials are shipped. Typically, RFPs are written to solicit a specific service from a vendor for merchandise or raw materials, telecommunications, printing, paper, ordering systems and fulfillment services.
An RFP is a detailed request that provides product requirements, service terms and maintenance necessities to a vendor who responds with a list of capabilities and a price for his or her wares.
Most catalogers begin searching for a vendor about year before they expect to implement a new technology, product or service.
When to Use an RFP
Writing an RFP is a harrowing but empowering exercise. Most catalogers transition into seriously writing proposals at about the $10-million revenue mark.
Smaller catalogers use RFPs when they’re buying equipment or services that critically impact their business, such as ordering systems, fulfillment services or call-center services. Occasionally, a small cataloger will reach an order-volume level that warrants better attention from a vendor and use RFPs selectively.
The process begins when more than one person in a catalog company starts to notice inefficiencies in product ordering, heavy call center loads, fulfillment problems or just a level of dissatisfaction with customer service.
From there, staffers gather to outline what requirements they need and want in a replacement system or product. This process, writing the RFP, typically takes four to six months. And it’s laborious, says Jim Padgitt of Direct Marketing Insights. He doesn’t recommend using RFPs unless necessary.
“If you’re a Williams-Sonoma or an L.L. Bean where purchases are significant, it makes sense to develop an RFP. But an RFP is a lot of work. It’s not something you knock off in an afternoon,” says Padgitt. “Smaller companies don’t need to take what an RFP requires for small purchases, typically the kind small catalogs make. It wouldn’t make sense to take the time and effort.”