Safety Management
RFI vs RFQ in Construction”
If you’re involved in procurement, you’re probably very familiar with requests for information and proposals while engaging with suppliers, service providers, and other stakeholders. Procurement is streamlined through RFIs, RFPS, and quotation requests.
Although a Request for Quotation (RFQ) may seem somewhat distinguished from a Request for Information (RFI) and Request for Proposal (RFP), RFIs and RFPs are often confused. While all these processes have common features, understanding the distinct qualifications of each is paramount to securing bid opportunities.
When a company disseminates an RFI, they are requesting general information regarding a prospective contractor’s capabilities, services, or products. The phase following this involve an RFQ (Request for Quote), asking for pricing on the requested services, or an RFP. The RFP involves a comprehensive overview of the company as well as its products and services as they relate to the business request. In this guide, we clarify the differences between an RFI and RFP, when it is suitable to use each, and how to go about compiling each document.
A Request for Information is used by procurement teams to solidify the options available for meeting project goals, solving problems, and determining the best suppliers to complete these tasks.
RFIs minimize blind spots and enable teams to make more informed, strategic decisions by obtaining structured, comparable information from suppliers regarding their scope of services and unique benefits.
In construction specifically, RFIs aim to clarify agreements, plans, and specification information gaps in compliance and administrative documents. It is important for all parties involved in the construction project to fully understand how an RFI works and how to effectively use this information to prevent delays and legal claims, as well as minimize additional expenses.
An RFI in construction may be used during any stage of the construction process. This may include the bidding stage to refine quote details or the building stage to clarify specifications and document material concerns. RFIs were previously tracked with tedious spreadsheets. These days, more companies are adopting the use of construction management applications that allow process and document management to save time, money, and raise standards.
When requesting information, the way you present the request will influence the response and the quality of information. A request should clearly stipulate what is required, how it should be presented, delivery time-frames. At the same time, you should be respectful of the supplier’s time. Balance brevity with open-ended information requests.
To get the most out of suppliers when requesting information make sure the document includes:
An Overview of Your Goal – Offer brief information about your own company and the project at hand. The supplier should get a clear idea of what it is you want.
Context – This includes any relevant information about the project, core values, and customer preferences that can assist the supplier in their response. If, for example, it is an eco-build project, your supplier needs to know this.
Information Details – Detail exactly what information you need as well as the problem that needs to be solved. It’s also a good idea to include what you are NOT looking for so that suppliers don’t waste time including unnecessary information. Specify skills and credentials, including team size, expertise level, operation systems, and technical restrictions. The more specific you are, the easier it will be to get the information you need and make comparisons.
Process Information – This should include deadline details for submissions, how soon feedback can be expected, evaluation criteria, and formatting guidelines. Provide the supplier with a response template where possible. This ensures that all suppliers submit information in a way that is similarly structured and easy to compare and evaluate.
RFIs are used across a range of industries and are a crucial part of streamlining construction projects. RFIs are used to supplement information regarding contractor details, designs and drawings, specs, materials, compliance, and building standards. It can be sent from contractors or subcontractors to designers, clients, vendors, and other involved parties.
A Request for Proposal is a public request for bids by an organization to complete a defined project. Government agencies often make use of RFPs as well as some private organizations. The RFP defines project goals, sponsoring organization, contract terms, and bidding process. Interested bidders will then respond to the RFP with their proposal before the stated due date.
Before submitting an RFP, it is important to consider the legal implications that can result from your submission. Submitted information and documentation can be applied in the legal and binding contract if the bid is accepted. Terms and conditions related to representations, indemnification, confidentiality, and warranties are sometimes included that would generally not be accepted without negotiation. Always have RFPs and the responses revised by a legal department to ensure full regulatory compliance.
Be specific as possible. Being ambiguous may result in unintended liability or create a situation whereby unspecified products and services (that are not integrated into the proposed fee structure) form part of the submission. Another reason to ensure all information is specific to the RFP, and that submission instructions are closely followed, is that the requestor may not recognize additional terms or objections if merely attached as standard terms and conditions. Most RFPs provide direct instructions to address objections to the contract’s terms. These should be strictly adhered to.
Consider risk management and political perspective, identifying any conflicts of interest that can result from a successful bid. Sensitive information such as social security numbers should never be included in the RFP submission.
When drawing up an RFP you should clearly define the scope and price. This gives bidders clear guidelines on what to include in their submission to stand a chance of winning the bid. Include preferred skills, strengths, rates, bidding criteria, and submission format. Since it is a complex process it is important to keep it clear, specific, and accurate. This way you maintain your reputation and make the evaluation process as simple as possible.
Whether you use an RFI or an RFP in construction will largely depend on what you are trying to accomplish. While both requests can be used in the procurement process, the type of information required determines which is more suitable.
An RFI is used to obtain information but not to make a final decision. An RFP to selected suppliers allows them to respond to a specific contract opportunity and serves as a decision document with very specific requirements and possible legal implications.
Monitoring numerous suppliers, procedures, and regulations, especially during a construction project can be challenging to say the least. Here, Salus has designed a solution to improve efficiency, minimize paper trails, and ensure regulatory compliance.
These digital safety compliance tools will ensure that projects remain compliant and that your team has access to the required project and compliance information at any time, anywhere. Find out how Salus can help you gain real-time progress insights and simplify construction management from initiation to completion by booking a demo today.