There are two different RFx documents that you can use to expedite your focused search for suppliers when requesting products and services from vendors. The first is a Request For Information (RFI). The second is a Request For Quotation (RFQ).
They are distinguished according to the information they gather. They are sometimes used together. These might be used to narrow down the group of vendors with whom you choose to engage for a Request For Proposal (RFP). These are used according to the type of information that you are after in deciding to pursue a contract.
What Is An RFI?
Essentially, an RFI asks how a vendor would go about providing a service or producing a project. For example, you would use an RFI to ask vendors specifically how they would go about building a bridge across a river. Your company wants to know what materials, or how much time would be needed, or what designs those vendors would propose to build the bridge. Companies use an RFI when they are not sure how a project should be accomplished. They want to hear suggestions. They want to learn the possibilities. RFIs help to narrow the field of vendors so that a few candidates can be approached for contracting.
What Is An RFQ?
Essentially, an RFQ asks vendors what their asking price will be for providing a specific service or product. Companies use an RFQ when the need is understood but the cost is not known. They want to ask vendors what their cost will be to do the project, to perform the service, or to make the product. They need to have an idea of how much they will have to spend on a specific project. They need to know what price would be best.
There are some similarities between an RFI and an RFQ:
· Both are used to give a chance for vendors to be a good choice
· Both are useful for minimizing the risk that companies may need to be exposed to
· Both help to save on costs
· Both are used to find the best vendor for a project
· Both narrow the field of vendor choices
There are differences between an RFI and an RFQ:
· RFIs ask open-ended questions, RFQs ask a specific question of cost
· RFIs are not a formal document, RFQs use a structured format
· RFIs ask general questions, RFQs ask specific questions
The reality is that it is important for both the customers and the vendors to ask smart questions when engaging in contracts for business. Customers asking the right questions with the use of RFIs and RFQs throughout the process will help them put together a strong Request For Proposal (RFP). And vendors knowing what questions to ask also allows them to determine if they should respond. This can save time and money and improve communication between both parties in negotiations with RFPs during contract negotiation processes.
Using Artificial Intelligence (AI) software technology will help with the development of the proposal capture process. The Proposal & Contract Suite, an out-of-the-box solution developed by Scion Analytics, can ensure the crafting of customized information templates and winning proposals.