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I do a lot of coaching on how to respond to Request for a Proposal, Request for a Quote or Request for Information. If a salesperson receives a RFP, RFQ or RFI where they didn’t have input into the scope of work or requirements that normally leads to Rest-in-Peace!
In reality it’s not very fulfilling when you’ve spent countless hours and effort on a bid that you didn’t really ever have the chance to win.
So what can salespeople/business owners do to increase the probability of winning an RFP? First, you have to know what you’re up against before you invest the time, the money and the resources to respond to an RFP. I say that because our research shows that companies that weren’t involved in helping the prospect create the scope of work/requirements in the first place rarely wins the business! Let me share with you the four “red flags” that let you know that you’re not the supplier of choice:
- When you receive an unsolicited call from an unknown buyer asking you to bid
- When the caller has a list of requirements that are a mile long
- When there is an artificially short time frame to respond
- When there is little or no access to the decision makers
8 Questions you Must Answer:
- What does it cost your company to respond to an RFP? (i.e., time, resources, etc.)
- How many RFPs do you respond to per month?
- How many of those RFPs do you win?
- How many of those RFPs do you win at full contract value?
- Is there an opportunity?
- Can we compete?
- Can we win?
- Is it worth winning?
The eight questions listed above help the most successful salespeople qualify the RFPs that they receive and they only respond to those that they have a reasonable chance in winning!
The answers to these eight questions really delineate the factual probability that we could have a mutually beneficial outcome if we respond to this bid. The most successful salespeople/companies qualify the RFPs that they receive and they only respond to those that they have a reasonable chance in winning!
In addition I suggest that you employ an RFP Triage Checklist. Here’s an example of a checklist we created for a client in the construction industry:
- How many companies are on the bid list? Which companies are on the bid list?
- Have we done business with this company in the past? What went well/what didn’t go well?
- Is the job in our “sweet spot?”
- Where’s the job located?
- Has the company purchased the land/building?
- Do they have the budget/access to funds?
- Who do we know within the company? How strong are our relationships?
- Is there a compelling event taking place? If so, what is it? When will it take place?
- What’s the time frame for the project?
In today’s business climate more and more companies are requiring their suppliers to respond to RFPs or at least be one of three competitive bids. Therefore, it is critical for you to determine early in the process if your prospect is going to take a serious look at your proposal or if they are going to use it to price-shop their preferred supplier.
Did you know that it’s becoming an increasingly common practice for companies to send copies of the proposals that they receive (complete with all of your hard work, creative ideas and pricing) to the competitors to get them to respond in a more aggressive fashion?
Purchasing Agents, Procurement Departments, Buyers and consultants are becoming more prevalent at the end of the “buy cycle.” Just as salespeople have historically been compensated for selling there is an increasing trend towards compensating Purchasing Agents for saving the company money by getting you to lower your price.
Remember, if you plan on investing your time and your company’s resources to respond to an RFP, you’d better make sure that it is a legitimate request and that you have more than a fair chance at actually winning that business!
