Once the sales team starts to look for alternative ways to increase the company’s sales per year, it will not take long before they encounter the world of RFPs (requests for proposals).
RFP or a request for proposal is a formal document that is most often issued by a government institution, government agency, or a nonprofit organization, where they are describing an issue they’re facing and looking for a solution.
However, RFP has become a very popular tool within private organizations and companies as well, because it allows them to find what they need more quickly and in a more efficient way. The issue with the RFPs is that many companies who’d like to get involved, don’t know where to start looking for them.
Since there are several RFP types, knowing the difference between them should help you realize where your starting point should be, so let’s just jump into it.
Different Types of RFPs
An RFP or request for proposal can be issued both by government and public institutions, as well as by non-profit organizations, as well as by privately-owned companies and other professional organizations. There is another classification that can be made, depending on the type of an RFP you are issuing. Here we will explain those differences since they will have an influence on where to look for requests for proposal (RFPs).
Open RFPs
Open RFPs are most commonly issued by public or government institutions. The term open refers to the fact that every potential vendor who fulfills the requirements listed in the RFP can place their proposal.
Government institutions often have no choice other than to issue an RFP, mostly because they are required to provide maximum transparency. This is because any purchase process organized by such an institution means that public funds are being spent.
Because of this, many governments require maximum transparency, so that the general public can see where is their money being spent, at any time. This also means that your contract could be available to the public since some of the government contracts are transparent.
This has another implication - their institutions usually have to follow very strict laws and regulations surrounding any purchase or RFP issued. Every part of the RFP is highly regulated and has to be done by the governing law. Government contracting a vendor is under the watchful eye of regulatory institutions in charge.
Any potential proposals received by the vendor are open to the general public - meaning that the prices are also transparent, so vendors can see and analyze each other’s proposals. This is to ensure that the competition is fair and maintained.
This will also ensure lower prices because vendors who jump out of the average will want to have higher chances of winning and thus they will revise their offer to match the competitor with the lowest price.
In these types of RFP, price is very important, because that is usually the only criteria on which the government will decide who will win the bid. However, this is not the only thing they will make decisions on. That’s why you should pay attention to the RFP - everything is nicely said there.
Since public RFPs are more regulated than the ones that are issued by a private company, they will also have guidelines for each part of the proposal process. First of all, the institution itself will have to follow a regulated and approved format, while the vendors will have to follow very specific rules regarding even the technical details - like the font you should use, what should be the doctype, etc.
Closed RFPs
Opposite of the open RFP is a closed or invitation-only RFP. It is called invitation only because this RFP is not accessible by the general public, and cannot be seen (or received) by anyone.
This narrows down the vendor’s list to a very few chosen ones who will have the privilege of receiving an invitation to bid in the process. The subject that is issuing the RFP will select the potential vendors, and send invitations only to them.
There are numerous factors you can take into consideration when you are making a list of potential vendors. The client has absolute freedom to choose whichever vendor they prefer, based on the criteria they have developed.
Usually, before an RFP (request for proposal), an RFI (request for information) is issued. This type of document gives you a more general image of what is going on on the market, and in what direction the companies are moving.
Based on the data received from an RFI, for example, you can choose the companies you liked the most and send them the RFP. Of course, this doesn’t have to be the only factor you will consider - also look at the company’s financial stability, how long they exist, are they moving in the same direction as you, etc.
After you narrow down your choice when the bidding process ends, you can issue an RFQ or a request for quotation, where you will get more precise information regarding the price.
The biggest issue with the closed RFP is that it really narrows down and limits competition. The proposal you receive is sealed and not visible to other vendors in the process. Because of this, the vendor with a higher price may not know that he needs to lower his price in order to stay in the process.
However, because of this trait, closed RFP will very rarely be awarded based on the price criteria. The client will look for a company that aligns with their mission and vision, so they can build a prospective relationship in the future. The vendor has to be reliable and offer the best price-quality ratio.
Closed RFPs, or any RFPs issued by a private company, are not regulated strictly like the previous ones. This allows the companies to have absolute and complete freedom to choose what type of RFP they will issue, in what form, who will be included in the buying process, how the winner will be chosen, etc.
With a closed RFP you are also increasing efficiency because there can be hundreds of applicants to the open RFP. When you have so many potential vendors, it is hard to make criteria, compare, and choose the right one for the job.
How To Increase Your Chances?
Looking for a way to increase your chances of receiving a closed RFP can be an exhausting process, especially if you don’t know where to start. The RFP response is usually drafted by the sales team since the RFP is considered a sales tool.
Once you realize that an RFP response is just like a sales pitch, you will start getting ideas on where to look for opportunities. Sales are a very old technique that knows that you have to build a relationship with the potential client first, and then to sell your product/service as the result.
Because of this, you need to look for prospective clients you would like to have in the future and start building a business relationship with them. Nurturing that relationship can only leave a positive impact on the potential client.
Another tactic you could use is to try to find a way to be a part of their database. This means that many companies who tend to issue RFPs very often usually have a part of their website where you can leave your data in their database.
This way, if an RFP that matches your criteria shows up, the potential client will most likely send you an invited bid, if that is what they opted out for. If you are really keen to collaborate with that specific company or institution, you can always give them a call and list yourself as an interested party.
This way they might put you on the radar, since this is not a conventional method of finding new clients, and you will definitely catch their attention. Also, if that option is not possible, make sure to check with them what are the requirements they are looking for, so you can see whether you will have a chance in the future.
Another thing you could potentially do is to get in touch with brokers or people specialized in RFPs. Procurement specialists are taking the role of finding the best potential vendor for their clients - the one that offers the best conditions and delivers the biggest value for the price they are asking.
Just one tip here - make sure to “refresh” every connection you have made, and to follow up with them from time to time. If you don’t nurture those connections and stay in touch, they will be most likely useless, since the person may completely forget about you in the meantime.
Where To Look For an RFP?
We started this article by explaining the types of RPF because based on that you can make a pretty accurate guess of where you can find certain types of RFPs. If you are aiming to collaborate with government institutions, a good starting point for you would be that specific institution website.
This means that you will have to do a manual search, checking each website separately. Although this can be a time-consuming process, if your target is only a few selected institutions, then this should be no issue. If you don’t have criteria based on which you’ve narrowed down the search, then this can be too much of a hustle for you.
Following the social media accounts of prospective clients can also be a good idea. Many companies are trying to go up-to-date with the latest trend, so they are increasing their presence on social media.
Although government institutions are still going by traditional values, many of them are transitioning and using Linkedin as their primary social media channel. Sometimes you can find RFPs there. Publishing RFPs on Facebook and other non strictly professional networks is not a practice.
Another place where you can look for an RFP is RFP databases. These are the websites that specialize in collecting all the issued RFPs in one place. This helps the companies to save time on the search.
While most of these databases will charge you a monthly subscription, it is nothing compared to the time they have saved you. However, bear in mind that these platforms are really good at collecting the majority of the RFPs that are issued, but not all of them. Simply there is no way they can collect every single RFP that has been published across the country.
Since there are too many databases you can choose from, make sure to choose the one that fits your needs the best. Some of the things that you need to take into consideration are how big the database is, how often is updated, what are features they are offering, etc. Here we bring you the list of some of the most popular RFP databases:
All of these databases collect RFPs issued by government institutions, while the first two also collect information on RFPs issued by the private sector.
How To Win More RFPs?
Wining in a bidding process can be very hard, especially when the competition is so harsh. There are too many companies out there competing with you for the same thing, that you need to find your competitive advantage if you want to stand out from the crowd.
However, finding a competitive advantage may not always be enough, since there are too many factors that can have an impact on the final decision. However, there are several stuff you can do to increase the chances of winning in a procurement process.
Make Sure You Can Win
If you are constantly working on finding new RFPs, applying, and still winning nothing, then you must stop and reevaluate what you are doing wrong. Being aware of your capacities is very crucial in this bidding process.
The most common error companies are making is that they tend to apply to RFPs they objectively cannot win. This is because usually they don’t match the requirements, and that’s why they are ruled out in an early phase.
Carefully looking at the requirements from the RFP will show you what the client needs, and based on those you can see whether you fulfill their expectations or not. If you don’t, make sure to skip bidding in that process, because you will only lose lots of time drafting the proposal, and get nothing in return.
The way to increase your chances is to bid only for those RFPs where you can actually have chances of winning. Even here you need to calculate the win and loss - is the time lost in writing the proposal, and later on realizing the project, worth the money you will receive from the client?
Learn More About the Clients
The key element of writing a proposal for the RFP is your understanding of the buyer’s needs. If you don’t understand the issue they are facing, how are you going to plan and implement a solution for them?
Before you even start drafting the proposal, do your research and find as much information as you can about your client. Try to learn what led them to the situation they are in, and what impacts the solution you are crafting is going to have on their business and their position on the market.
Only an extensive analysis as this one, which has been fully customized and adjusted to the client’s needs, will have a high success rate in the bidding process. If you write a too technical proposal, and you are not referring to the client itself in the proposal, you are very likely not going to have a strong chance of winning.
Follow the Instructions
Sometimes companies get too carried away or have many RFP responses to send, that they make the mistake of sending generic responses, without actually checking what the client has requested.
Maybe your potential client wants a specific structure to be followed, or a specific font and text size to be used, or they want a hard copy to be delivered alongside the digital one, etc. Nevertheless, you should carefully read the instructions from the RFP and act accordingly.
Issuers usually know that adding such requirements in the RFP is what is going to help them in the process because they will rule out straight away those proposals that don’t match the criteria. This is because that means that you haven’t carefully read the instructions, or you’ve just chosen not to follow them on purpose (can’t decide which one is worse).
Be Interested
Because RFPs can be very complex documents, and sometimes they can refer to a very specific and technical issue the client is having, there is usually a period where potential vendors can come to the client and ask questions about RFPs.
Here you can clear out any unclarities that may have risen, so you can avoid confusion later on. Asking questions is a good thing, because that will show the client that you are very interested in their project, and you are keen to learn more details, so you can craft the best possible solution for them.
If there is no such thing as this window period, and you do have some questions, you can always talk directly to the issuer. By doing this, you will probably get some bonus points.
Give a Personal Touch
In the end, maybe the most important thing for an RFP response is to give a personal touch to it. Highly personalized proposals will show the client how much effort you have put in writing it, and it will make them appreciate it a lot.
Make sure that throughout the proposal you are always having your client and their needs in the back of your head. You need to remember that the proposal is not about you - it’s about how you are going to solve the customer’s issue, and thus provide them value.
If you are using any software for drafting the proposal, don’t just send it like that - always make sure that you have read every single part of it, and that you have customized it according to the customer’s needs.
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