how requests for a quote work
an rfq is usually the first step in submitting a request for proposal rfp these two documents are similar as they provide details of the project or services required but rfqs generally ask for a more comprehensive price quote also businesses usually design rfqs for generic products in which the quantity needed is known and rfps are for unique niche projects where quantities and specifications are unknown in addition to pricing rfqs may include details such as payment terms factors that could influence a company s bid selection submission deadline and the like a government agency that wants to buy 500 computers with a specific hard drive size and processing speed for example would send an rfq to several vendors as prospective bidders because the rfq format is uniform within a given company when the rfqs come back with price quotes the soliciting company may compare them easily typically an rfq process consists of four sections the preparation phase the processing phase the awarding phase and the closing phase the company generally will award the contract to the vendor that meets the minimum qualifying criteria and presents the lowest bid special considerationsrfqs are not public announcements because the soliciting company sends rfqs only to businesses that it trusts it does not need to prepare lengthy procurement documentation also unlike a public solicitation a company can get back only the number of bids that it requested which also saves time using an rfq reduces the amount of time needed to procure goods or services it also offers a degree of security as a company will receive bids only from vendors it prefers on the other hand because rfqs reduce the amount of competition a company may miss receiving the lowest available price or learning about new high quality vendors 