There are many useful tools to identify an appropriate supplier for a particular product or service, in which a request for proposal (RFP) is considered a highly crucial method for supply chain professionals. It plays an important role in creating access to or supporting agreement between buyers and suppliers. However, the paradox is that RFPs are no longer used universally in business. There still exists controversy around whether or not RFPs should be applied as pre-contract engagement. With the aim of defining the potential issues of RFPs, this report, at first, presents the overview of RFPs and consideration for company when using RFPs, and then the author will analyze positive and negative side of an RFP to identify the key issues.
Consideration for preparation an RFP:
An RFP is a document prepared by the buyer for potential suppliers to be provided a product or a service at a targeted pricing. The aim of an RFP is to invite potential suppliers with commercial offers, so that it can remain competitive factor and collect information related to solutions, capability and response of suppliers. For a project, an RFP keeps the groundwork role. Like other pre-contract engagements, if the foundation is not well built, the project can not operated smoothly. Actually, it requires the buyers to present all their reasonable demands before embarking on running a project and clarify them to help suppliers be able to access, understand and response.
As long as RFP is operated properly, it provides a firm foundation for a cooperating relationship between suppliers and buyers. Therefore, before beginning to write an RFP, some issues need to be taken into account by operations. First, the operation should define clearly the potential suppliers who will be received the RFP. It helps the buyer save a lot of time to seek appropriate suppliers. There is no company expecting to spend time on considering which supplier has enough proper capabilities. The buyer can...