How to write a Request for Proposal (RFP)

In this video, we talk about how to write a Request for Proposal.

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What is a Request for Proposal? Well, the name kind of tells you what it is, right? I mean, it's kind of there in the title anyway. A Request for Proposal, or RFP, is issued by an organization to obtain proposals for the supply of inputs to the organization, usually goods or services. So, proposals in this case are what is commonly referred to as bids or offers, okay, in the world of tenders.

So, by requesting for proposal, the organization is simply saying, "Hey, look, we have this problem, okay? And, uh, we need somebody who can tell us how, or somebody can propose a solution, okay? How are you going to help us get to one to three?" So, that is what the Request for Proposal actually does. So, when an organization puts it out there, they're simply telling you, the supplier or the contractor, that, "Um, is the problem you're facing? So, kindly suggest a solution to that problem, and then tell us how much it will cost us, the organization, to finance the film."

At times, an organization may use a Request for Tenders, RFT, which is alternatively called an Invitation to Tender or Invitation to Bid, when seeking offers for the supply of inputs to the organization. And so, with that, you can, you know, ask yourself, or somebody might actually propose this question: Is there a difference between RFP and RFT? Of course, there has to be some difference, otherwise, you won't have those two terms.

So, a Request for Proposal is used where the requirement is less prescriptive or less defined. So, that means when an organization requests you to do that, okay? When the organization puts out a Request for Proposal, they're simply saying, "Is the problem," and, uh, therefore, you expect you to be creative in proposing the solution, because we have an idea of what we need, we just don't have the details or the, the technical details of how to go about it. Like, uh, basically, it's like saying, "Well, I'm starting an e-commerce business, and, uh, for starters, I'm looking for an e-commerce platform," and that's pretty much it. And so, "Can you help us come up with one?" I mean, yeah, so, yeah, I have a rough idea of what I want, I just don't know the details that go into making that thing. So, that, in that case, I'll say, "Write me a proposal telling me how you're going to do it." And since I'm sending this thing out there to more than one supplier, I mean, it's, it's pretty much anybody who can do it is going to respond to it. So, that means I get to get various ideas, various alternatives to my problem. So, that is, that is why the organization does that.

So, another example here would be, let's say I want a studio. Now, I know some things that a studio will need, okay? And, uh, probably they'll need a camera, a microphone, lights, you know, the basic stuff. But as far as interior decoration is concerned, I have no idea how to go about that. So, I may want somebody, okay, some interior designer, to propose a solution to that. So, they write me a proposal, tell them what they're going to do, and if I elect the proposal, then we...

Again, in contrast, the Request for Tenders, Invitation to Tender, Invitation to Bid, will be used for more exacting requirements with tender latitudes correspondingly reduced. So, in this case, I'm saying that you know exactly what you want. So, in that case, what you're going to do? Well, you're going to use those... I'm going to use RFP.

Here's the thing: Most organizations don't want to waste time going through their own Requests for Proposals just to get bombarded by unsolicited proposals or proposals from people they don't really want to work with, or people who are not qualified to be writing those proposals. And by people, I mean suppliers. So, to avoid all that, the organization can use things like Request for Information, Expression of Interest, basically RFI and EOI, to avoid all these. Now, these are open documents. And by open documents, I mean they are the kind of documents that if you act upon them, it doesn't really mean that you have a contact with the organization. In fact, what they're actually doing is that they provide the organization with information to shortlist the potential suppliers from whom they can then request for proposal or request for tenders.

So, let's talk about the main parts in a Request for Proposal, all right? So, the templates used in a Request for Proposal will differ, obviously. But the following are the four main parts that all those templates are going to look rather to have, irrespective of whatever format you're using. They're going to have the following four things: Number one, Instruction to Proposers and Proposal Conditions. Number two, the Requirement. Number three, Information to be Supplied by Proposers. And Number four, the Proposed Contract.

Now, as part of this, you know, as part of this learning process, I've used some of the materials from the CIPS, basically the Chartered Institute of Procurement and Supply. I mean, those guys are all about procurement, so, you know, you can also check them out and see some of the materials they have. But I'm using some of their materials as a guideline to help you develop your RFP. Again, I just want to point out that if you're in a position to make sure that you download the template that comes with the PDF template that comes with this video, and you can use it as you go along, okay?

So, let's start. Let's talk about the first thing that you need to do. Number one, Instruction to Proposers and Proposal Conditions. So, this part is going to set out the expectations, obligations, and requirements for the buyer and the proposer while the RFP is active.

Here you have definitions. So, it's always a good idea to start with defining the terms you're going to use and basically to avoid confusion as you go along the, the proposal. So, by definitions, these are the things that you're going to define: things like company name, contract, contractor, proposal, proposal requirement. So, what is any of those ones going to mean as far as the proposal is concerned? Here's what I mean, okay? I mean, um, you can also use the template to understand more about this, but, uh, is what I mean. An example: So, by "company," so, "company" means, then you insert the name of the company. "Contract" means any contract that results from these Requests for Proposal. "Contractor" means the entity that forms a contract with the company for provision of requirement. "Proposal" means a written offer submitted in response to this Request for Proposal. "Proposer" means an entity that submits or is invited to submit a proposal in response to this Request for Proposal. "Requirement" means the supply to be made by the contractor, the company, in accordance with, you know, part two of the RFP, okay? By part two, I mean the part where you're going to be talking about your requirements. So, if your requirements are in part three, then you might as well, as in accordance with, you might as well say, "in accordance with part three." But for, for the sake of this one, part two is going to be how we talk about the requirements. And so, again, look, it's, if you can, okay, just download the PDF so that you can go along with this. You don't have to like wonder, "Wait, what is that and where is it coming from?"

Now, let's move on. So, the next thing is to write a summary of requirements. So, the idea is to summarize the requirements in such a way that the proposer is going to have an idea of what you want. So, here's an example. Is something that I downloaded, rather, I accessed from one of the UNAIDS kind of RFPs that they wrote some years back. So, it's an example of requirement: "The purpose of this Request for Proposal is to enter into a long-term agreement (LTA) with successful bidders and select suitable contractors to carry out the ongoing IT outsourcing needs of the UNAIDS for duration of two years starting in April 2015, with the potential extension of one additional year. UNAIDS is seeking functional and technical skills in the following areas of information technology: there is open source development and then, you know, using Drupal, PHP, whatever system and database administration, project management, business analysis. UNAIDS, an organization that is dependent on the budgetary and extra-budgetary contributions it receives for the implementation of its activities. Bidders are therefore requested to propose the best and most cost-effective solution to meet UNAIDS' requirement while ensuring a high level of service." That is an example of requirements. Of course, you can do better than that. I mean, I'm not saying that is, but that is good. But I'm just saying you can do better, okay, depending on whatever it is that you want. So, understand your requirements. What do you want them? I mean, what problem do you have? When so that they can write a proposal to that. If you put out bad requirements, then it kind of just means that they're going to put a to write a proposal that is not going to meet your needs.

So, the next thing that you want to worry about is the structure of the document. The reason why you're doing this is because you're trying to help you, uh, you know, you want to make sure that whoever is reading the, whoever's writing the, the proposal, and so ever, and also whoever is reading it, they know where they can find activities that they are looking for. I'm talking about having a structure like, uh, for instance, title, part one. So, part one, you have something like Instruction to Proposers and Proposal Conditions. Part two, Requirements. Part three, Information to be Provided. Part four, Proposed Contract. And then the description: what exactly is contained in all of these these parts? So, you make sure that you have that.

Now, the next thing that you also want to make sure that is there in your, in your RFP is RFP key dates. The idea being the date is so that we can know when is what happening, or what is happening at any given moment. I mean, things like some of the key dates will include things like RFP issue date, date for the proposal acknowledgement, date of proposal briefing or site visit, if need be, RFP closing date and time, estimated contract award date, all that stuff. So, you need to make sure that, of course, if there are things that you want to add, you can also add. Remember, as I said, this is just a template, okay? There are various ways you can write a Request for Proposal, so, you know, it's all up to you. What are the key dates? What are the key important dates? And then you put them there.

Now, next, company contact person. So, the company contact, who's the key contact person? I mean, look, you, in case somebody, in case a supplier is writing, and they need some clarification or something, whom do they contact? So, put the name there, okay? Talking about things like the person's name, their title, their contact number, whatever it is, email address, all that stuff. So, make sure that that one is also there in the RFP.

Now, next, queries and questions during the RFP. At this point, you just want to show that the process is going to be a fair process. In case the supplier or the proposer has some doubts, okay? So, you are kind of, uh, solving, so kind of just melting down all those doubts. So, you could have a clause that says something like this: "Proposers are to direct any queries and information regarding the RFP content or process to the company contact. No other company personnel are to be contacted in relation to this RFP unless directed to do so by the company contact. Company reserves the right to disqualify and reject proposals that do not comply with this requirement. All questions should be submitted in writing, either by post, fax, or to the nominated email address. Company may choose to convey responses to submitted questions and queries to all proposers so that each is equally informed."

Now, the next thing you want to put down there is proposal briefing and site visit, if need be. It could actually be a case that, I mean, imagine you enter an RFP for construction of a school. So, it doesn't matter how good I am with my architecture or construction company, I'm not just going to start writing a proposal when I've not even visited the place. I need to know what does the land look like and all that stuff that mattered to people who do constructions, okay? So, they may want to visit the site. So, you need to tell them something like: "Company will hold an RFP briefing session to further familiarize proposers with their requirement. This briefing will also include a visit to the company site. A maximum of two representatives from each proposer is permitted to attend the RFP briefing session and site visit. Further details regarding the RFP briefing session and site visit will be provided to proposers."

The next thing you want to talk about is amendments to the RFP documents. This is where you show how any changes are going to be handled. In case there are changes, how are you going to handle those changes? So, it could be something like: "Company may amend the RFP documents by issuing notices by way of formal, you know, whatever you want to put there, by way of formal, you know, variation or addendum to that effect. All proposers may extend the RFP closing date and time if deemed appropriate." Some companies get crafty with these. I mean, they, they put out an RFP and then you do whatever you want to do, but since they want to eliminate some of the people, okay? So, they change something, they do a variation, and then they send an email or through whatever channel they say they're going to use, and now you're stuck there. You didn't read the thing, and come the day, you're disqualified, and you're like, "Wait, how did that happen?" Well, because we changed a few things that you didn't change in your proposal. So, you always have to make sure that you have open lines of communication, and they say they're going to do this, and they're going to do it through these platforms. You pay attention.

Next, proposal lodgement methods and requirements. This is where you actually give instructions as to how the proposal is going to be submitted. I'm talking about things like: "Proposals must submit dash number of copies of the proposal to the company in any of the following methods: by post," so you give the postal address, "by email," of course, you give instructions regarding that one, "by hand," they give instructions, and so on and so forth.

The next thing you want to bring out is the plan in case of late proposals. So, you could say something like: "Proposers are responsible for submitting their proposal prior to the RFP closing date and time in accordance with the acceptable lodgement requirements described in clause blah blah blah," so, you know, you give a number, you give a number as to of that clause. "There will be no allowance made by the company for any delay in transmission of the proposal from the proposer to company. Any proposal received by the company later than the stipulated RFP closing date and the time may be removed from further consideration by the company." So, yeah, that, that is important. You need to tell them that so that you don't have to deal with people who are submitting their proposal late.

But the next thing you also want to talk about in your RFP is rules regarding acceptance of proposals. Why is that important? Now, you have to understand why are they doing this? See, the proposal is going to lead to a contract down the line, and so you want them to know that accepting a proposal is not necessarily the same as accepting that you have a contract, and basically, you need to cover yourself legally as far as that is concerned. So, I'm talking about something like: "Proposal may be for all or part of the requirement and may be accepted by the by company either wholly or in part. A proposal will not be accepted by a company unless and until company has signed a contract or sent a notice of award in writing for the successful proposal. Company is under no obligation to accept the lowest priced proposal or any proposal and reserves the right to reject any proposal which is incomplete, conditional, or not complying with the RFP document." That is one of those parts that you don't want to leave out in your proposal because, look, you have to limit your liabilities, okay? So, these are some of the risks that, uh, you encounter by poorly drafting RFPs and then you end up being sued. So, you don't want to leave that out.

Now, next, validity of proposal. Okay, here's what you need to know. Proposals are just like offers. They're not going to run forever, okay? So, you want to explain to them that this thing is only going to be valid between this time and this time. Past that time, it's done. So, you have to make sure they know that. So, you need to have something that states along the following lines: "Proposals submitted in response to this RFP are to remain valid for a period of," and then you give them the time, "from the RFP closing date."

Next, talk about evaluation of proposals. At this point, at this point, you just want to talk about the company policies regarding how you're going to evaluate the proposals. This is important because again, it will help the proposers to know what you're looking for. I mean, they could use it to beat the system, but that's not the point. The point is, these are policies that you're going to use so that if somebody is rejected, they know why they are rejected. So, things like: "The minimum selection criteria to be used in the evaluation of proposal include, but are not limited to, the following," so you can insert the criteria. "These criteria are not in any particular order, nor do they necessarily carry equal weight. Company may request additional information from proposers to assist further evaluation of proposals." The more prescriptive your definition of the criteria are, the more weight it puts on you. Any, but it doesn't really matter, it depends on your policies. What are you going to look at? Is it cost? Are you going to look at track record of the proposer? I mean, there are many ways to evaluate business, okay? So, it depends how are you going to select the qualified person and the person who is into the proposal that isn't qualified.

Now, the other thing that you also want to make sure that is available will be regarding withdrawals. So, it could end up having something like this: "Proposals may be withdrawn at any time prior to the RFP closing date and time by return notice to the company." And so...

The next thing that you also want to make sure that is available there is a clause stating that proposers are to inform themselves. It is important to make sure that you have that clause. I mean, the clause is one of those clauses that kind of just again help you to limit your liability. So, it could be something like: "Company has taken all reasonable care to ensure that the RFP is accurate. However, the company gives no representation or warranty as to the accuracy or sufficiency of the contained information, and that all proposals will receive the same information. Proposals are required to inform themselves fully of all conditions, risks, and other circumstances relating to the proposed contract prior to submitting a contract. Proposed prices shall be deemed to cover the cost of complying with all the conditions of the RFP and all of the things necessary for the due and proper performance and completion of the requirement."

The next part you want to make sure that the proposer knows your stand as far as the cost of preparing the proposal. Now, why are you doing this? You're doing this because we really don't want them to to do something and then later think you're going to reimburse them. So, you're going to have a clause, okay? Well, unless you're going to reimburse them, so you're going to have a clause that says something like: "All costs relating to the preparation and submission of a proposal are the sole responsibility of the proposer. Company shall not pay any proposer wholly or in part for each proposal."

After that, you want to talk about confidentiality. Of course, that will depend on the, on the, on the type, the type of proposal, on the nature of work to be done. So, you could have something like this as a clause in your RFP: "Except as required for the preparation of a proposal, proposer must not, without company's prior written consent, disclose to any third party any of the contents of the RFP documents. Proposals must ensure that their employees, consultants, and agents are also bound and comply with this condition of confidentiality." Of course, these are those areas that you're going to have to seek legal advice on, okay? Because you may end up having cases where somebody says there's copyright infringement, there was whatever. Look, just seek legal advice.

Next, inconsistencies and omissions. I mean, it's not like if you cannot make a mistake. We all make mistakes. So, this is where you want to bring out the, the question of what if there is a mistake in the RFP? What if, what if the company has made a mistake? So, you can have something like this in that RFP: "Proposers must promptly advise company in writing of any inconsistencies and omissions they discover in the RFP." Why are they doing that? Because, look, you, you know, somebody can actually exploit your mistake and profit from that. So, you just want to let them know that if they try to profit from your mistake, you can later just say, "Look, these are mistakes we made, and this is the clause that we wrote that say that we are in a position to make a mistake. I mean, we could have made a mistake, and so if we did, we are not really going to be held liable for that or held accountable for that." Here's why.

Now, the next thing you also want, again, I just want to point out that, uh, there's a PDF that you can download that goes along with this, so that it makes it easier for you to follow along as you're watching the video. But the next thing that you also want to make sure that is there in your RFP is number two, the requirements. So, remember, everything we've been talking about is part of number one, which was Instruction to Proposers and Proposal Conditions. And so, now we're talking about number two, which is the requirements.

So, what are these requirements? The idea here is to make sure that you've actually stipulated the requirements, okay? What exactly do you need the proposers to talk about? What, what, what is the problem that you're having so that they can propose a solution to that? Um, you're going to have something like this: "Background and context for the requirement. Organization's overview, including contract details. So, who's involved in the requirement? Who specifically are the customers of the requirement? Who will be the principal point of contact in the buying organization? Little descriptions of the requirement." That is something else that you also want to bring out. Sometimes requirements need to be very technical and prescriptive, setting out exact obligations like weight, size, color, and distance. In other situations, usually in a case of RFP and not in RFT, the requirement can be more functional or performance-based and describe the expected outcomes or the problem that needs to be solved.

Next, you can also use drawings and diagrams to give more details as to what you expect. Next, mention quality requirements, performance standards. You also want to talk about whether they're going to be some approvals required, things like external permits or things like that. And finally, you also want to tell them your inputs, the buying organization's inputs. What are going to be paying for? What are you going to provide? If there is anything that you're going to provide to help the proposers to understand more about your, your requirements, meaning, will the buying organization be providing any services or materials in support of the requirement, e.g., office space, materials, computers, etc.? So, you really need to be careful when you're doing this. Remember, aside from the part which was just instructions and stuff like that, this, the requirement phase, this is the part of the proposal that will actually end up becoming, rather, end up forming the final contract. So, you really want to pay attention to what you write here. You really want to pay attention to the kind of information you give out at this stage.

Now, next, let's move on to number three, or part three, Information to be Provided by Proposers. So, far, what you've done is that you've told the, the proposers, okay, your requirements. Now, it's time for you to move further and tell them exactly what it is that you want them to write back about in their proposal. This section of the RFP sets out what information the buying organization wants to receive from potential suppliers. So, again, I just want to remember, just like in the requirements part, the information outlined in this section is also going to form part of the final contract. So, you have to be careful. An excellent RFP drafting principle is to keep all response obligations in one place. This way, the potential supplier does not need to search through the whole RFP to work out what questions need to be answered or informed.

Information to be provided. Now, the information to be provided by the potential suppliers tends to fall under three categories. So, these are: Pricing Information, Other than Price, Commercial Information, and Number three, Technical Information.

Pricing Information: This section is going to be used to collect the price and rates from all the suppliers.

And the other one, Non-Price Commercial Information: So, under this, you're going to have things like: Form of Proposal, Company Details, Contact Information, etc. Financial Information, History and Previous Job Performance, including references from clients, Details of Health Insurance, Compliance with the Proposed Contract Terms and Conditions.

And then, Technical Information: So, here you're going to seek information that will involve things like: Execution Plans and Key Dates, Details of Resources and Key Personnel performing their requirement, Proposed Subcontractors or Outsourcing of any part of the requirement, Quality Management Plans, Health and Safety Management Plans, Environment and Sustainability Management Plans, Employee Relations and Industrial Regulation Management Plans, Other Management Plans and Administrative Arrangements, Risk Management Plans and Mitigation Approaches, Transition or Implementation Plans, and any Proposed Alternatives.

So, once you have all that in place, the final stage is going to be the Proposed Contract. Now, your proposed contract is just going to be, I mean, it's something that you're going to talk about, but you can have a blank kind of, I don't mean, you can have a draft contract, okay? So, that they have a clue as to what the contract is going to be like.

Now, this, whatever you've just talked about, is, uh, it's just a guide to writing RFPs. So, download the PDF, which is a template, and then you can fill in. Of course, feel free to change what you don't want, and all that stuff. In case of any question, do let me know. Amuses, and I'll see you in the next video.