|How to win business by successfully preparing your response to a client’s RFQ
Over the past few years, multinational consulting firms advised multinational corporations to develop strategic relationships with suppliers to improve operational efficiencies, quality and reduce processing costs. That trend has now moved from the largest companies to smaller companies with print purchasing requirements.
Eligible printers now receive an RFQ document the size of a book and then the fun begins. Company owners and commissioned sales reps see huge opportunities with the tender and want it all, even if it means their company will have to double or triple in size.
One printer contracted my services after having a poor experience with the RFQ process. He was invited to submit a tender to a major client that his shop had been serving for a number of years. The customer was going to consolidate its supplier base and the printing company was faced with the opportunity to win significantly more business or lose it all. When the RFQ arrived, the sales team panicked. This was the first time it had the opportunity to deliver a detailed response to an RFQ. Estimating could review the tender and estimate prices, but who would provide the rest of the detail that was required? Since the sales person was away on business, the sales secretary was asked to prepare the response, which required detailed marketing information about the firm. Most of this information had to be cobbled together from the sales brochures. The end result was failure—and price may not have been the determining factor.
|When the RFQ from a major client arrived at one printer, the sales team panicked
When you receive the RFQ, review it quickly to make sure you understand all the questions. If you wait until you are crunching the numbers to clarify questions, you may find it’s too late and a lot of work may need to be redone.
Make sure you understand what the evaluation criteria are. Frequently the clause “the lowest price will not necessarily be accepted” (or words to that effect) is included in the RFQ document. That said, if the other qualifications are met, then the lowest price often does win. Therefore, you should take care to meet those other qualifications.
Be prepared. Have quality marketing information and a true value proposition for your customers. Why are you different than your competition? Your value proposition should be something better than “better, faster, cheaper”—all customers have heard that one before. It will require considerable thought and effort to put your words into practice.
The elements of the RFQ should include:
• Short statements confirming you understand the objective of the RFQ. This does not mean repeating exactly what is stated in the tender document, but demonstrating that you truly understand its objectives
• A company history that demonstrates continued growth and success in providing excellent service to your customers
• Your company qualifications. In other words, what differentiates you from your competition? What value will you bring to the table for your customers?
• Experience with similar projects. You are not likely to be awarded major work if you have not had experience with similar projects
• References are important even though we know customer testimonials are used more as an indication that you actually have customers than as a key factor and that major firms know that you will not include a bad customer testimonial
• If you are offering a unique approach that sets you apart from your competition, such as online order entry, etc., it needs to be featured in your response. Also, take the time to explain how your offer will truly benefit your prospect
• Your quality-control process is important to prospects. Your firm may have a formal process such as ISO 9000 in place, or it may have an informal process. Is your quality-control process documented? Can you prove that it is adhered to or is it only theory?
• Introduce the qualifications of your team and indicate how your team will interact with the prospect’s staff to make one project team. The goal is to ensure complete project management coverage and total customer satisfaction
• Your escalation process. How you resolve quality issues or customer complaints can be important. Although each case may be unique, you should have a formal process for handling the issue and the actions you take to prevent re-occurrence
• Firms are often asked to demonstrate that they are financially stable. This may require a letter from your bank
• Do not change the specifications, as this will often disqualify you. If you have a recommendation that will result in a better product or price, if the company accepts it, then you may include an addendum indicating the option for revised specs and cost savings
• And finally, if you have not disqualified yourself by this point, pricing will be the most important component. Detailed estimates, accurate calculations and significant work is required to provide the cost information in the format that has been requested. Make sure you can live with the consequences for the duration of the contract.
When preparing your response, remember to keep it simple. If you are too wordy, you will not win any friends on the evaluation team.