Depending on the industry you work in, you may be familiar with one or both of the procurement processes that go by the acronym RFQ. For many, a request for quotation may be more familiar. However, its counterpart, the request for qualifications is just as useful.
In this blog, I’ll focus primarily on the request for qualifications. But, to get started I’ll define a request for qualifications vs. a request for quote. Then, I’ll outline the common uses for an RFQ as well as the components of the document. Finally, I’ll offer a request for qualifications template and examples to help inspire your next procurement project.
The two RFQs: Request for qualifications vs. request for quote
Admittedly, there are a lot of acronyms in procurement. So many, in fact, that we created an RFx glossary to help navigate all of the terminology and abbreviations in the industry. However, RFQ stands for both a request for qualifications and a request for quote. Consequently, there is some understandable confusion. So, to start, let’s establish the difference between the two RFQs.
What is a request for qualifications?
A request for qualifications is a document that asks potential suppliers or vendors to detail their background and experience providing a specific good or service. In this case, the buyer is only concerned about the vendor’s skills and experience. Therefore, the response is not a bid. Often, this response is called a statement of qualifications or SOQ.
What is a request for quote or quotation?
A request for quote or quotation is a document that details a buyer’s requirements and asks vendors to respond with pricing and payment terms. The focus of this document is primarily price, and often, the lowest priced bidder will win the business.
Now that we have the basics out of the way, we’ll be exploring the request for qualifications. So, below when you see RFQ referenced, it will stand for request for qualifications.
The RFQ’s role in procurement
Who uses RFQs?
The request for qualifications process is common to the government sector. Most RFQs issued are for projects involving construction management, architecture, engineering and other professional services.
3 ways to use an RFQ
In most cases, this process precedes an RFP, but not always. Procurement professionals may use the RFQ in three different ways.
1. Vendor selection for an upcoming, identified request for proposal
In this case, the procurement team has a project in mind. However, they want to send the upcoming RFP only to the most qualified vendors. The RFQ is sent to a large group and helps narrow the field of vendors for the subsequent RFP.
Certainly, this two-stage approach allows for a shorter, more focused RFP. In addition, evaluating a handful of pre-qualified vendors is much easier than scoring proposals from dozens that may not be able to meet your needs.
2. Non-competitive RFQ to catalogue vendor information for future procurement projects
Much like using vendor profiles, requests for qualifications are a helpful tool to organize important supplier information. In fact, some companies use RFQs as a standard part of their vendor onboarding process. Then, as future procurement needs arise, the most qualified vendors are selected to participate in the RFP. Having this information on hand makes the procurement process more efficient.
3. Rapid vendor selection
Occasionally, an RFQ replaces an RFP. For straightforward projects that require a specialized skill set, a company may issue a request for qualifications, evaluate the statements of qualification and move directly to contract negotiations with the most qualified vendor. In this scenario, the RFQ should offer details about the project budget. This transparency empowers faster contracting and ensures that only vendors prepared to work within that budget respond.
How to write a request for qualifications
1. Outline your objective
Because a request for qualifications can be used in several ways, it is important to clearly state your intended outcome. Consider what outcome would make this RFQ a success. To do that, you may need to enlist feedback from stakeholders or executives within your business. What are the specific requirements for the project? Are there essential technical skills? How many years of experience or similar projects should a vendor have successfully completed?
The more context and detailed questions you can add, the better your responses will be. Not only that, but providing a thorough understanding of your needs will discourage unqualified vendors from responding, which will make your evaluation process easier.
2. Create your RFQ
With your list of requirements in hand, it’s time to create your RFQ. It can be helpful to create a template to work from to ensure you don’t miss any crucial components. If you have an RFP management system, leverage dynamic templates to group common questions together into sections.
Essential components of an RFQ
Company information including business details and primary contact person
Project description with background information, desired outcome, scope and next steps
RFQ timeline noting submission due date, shortlist selection date and final decision date
Evaluation criteria and weighted scoring details
Qualification questions and experience requirements
Contracting terms and conditions if applicable
3. Issue the RFQ
Now, it’s time to send it. Contact the vendors you’d like to hear from through an RFP consultant or directly through email. If you use RFP software, you can issue the RFQ digitally, communicate with vendors directly in the centralized platform and track their progress. In addition, you can answer questions and share the information with every vendor instantly. This helps to keep your RFQ fair and transparent.
4. Evaluate the responses
Finally, the due date has arrived, now you’re ready to evaluate the statements of qualification you’ve received. Start by reviewing each document to see if the organizations followed directions and filled the RFQ out completely. If there are any gaps, you may go back to the vendor for more information or remove them from consideration.
Next, it’s time to score the responses. Refer back to your request for qualifications for the scoring criteria and weights you established. Some questions will have straight forward yes or no answers, making them easy to score based on the desired answer. For subjective questions, it is helpful to engage your stakeholders to provide their input. Again, RFP software can help automate this process and empower easier collaboration with your evaluation committee.
Once all the SOQs are scored, hopefully you have a clear set of front runners, or perhaps even a winner. Remember, even if you don’t select a particular vendor, RFQs can be useful to keep on hand for future procurement projects.
Request for qualification template and examples
Request for qualifications template
To get started, check out this blank RFQ template. It includes all the essential information you’ll need to solicit statements of qualification from vendors. In addition, you’ll find descriptions of what each section should contain to help you create an effective RFQ.
In 2015, the Colorado Department of Transportation issued this RFQ to identify qualified vendors for an upcoming highway construction project. Five teams provided their qualifications and a subsequent RFP was sent to four vendors who qualified. This RFQ is impressively thorough and provides lots of information.
This non-competitive RFQ allowed the City of Seattle to create a roster of pre-qualified firms for upcoming legal work. The request for qualifications provides ample background information as well as clear expectations. In addition, the document outlines the available budget for legal services.
When the City of Great Falls, Montana wanted to create a new logo for their Downtown Parking Program, they issued this request for qualifications. This RFQ example is brief and to the point. It includes a brief description of the project, requirements and submission instructions. Just the essentials and nothing more.
Seeking expertise in educational design, the Bedford County Public Schools issued this request for qualifications. The document provides evaluation criteria, guidelines for the SOQ and a form to fill out that guides the vendor through the requirements.
The City of Chamblee created this RFQ to find call center vendors equipped to provide a wide range of services. This request for qualifications example is helpful because it is cleanly designed and easy to read. Indeed, the expectations and project details are clear at a glance.
Just like other RFx documents, the request for qualifications can be a helpful tool for procurement teams looking to accelerate and optimize their RFP process.
To learn more about other RFx processes and how technology empowers them explore these resources: