4 Ways to Determine if an RFP Is Worth Responding To
You’ve just received your third Request for Proposal (RFP) of the week. While skimming through the document, your mind runs through a list of questions and criteria to qualify the RFP. While this approach may seem fairly intuitive to you, there are challenges that may arise from this process in the future.
For starters, it is not clear to anyone else in your organization why a decision to respond was made. This can create a lack of alignment across stakeholders and as a result waste valuable time across your team. This approach is also not scalable. As your team grows, so does the potential for the evaluation process to become messier if each person is applying their own criteria.
Creating a consistent framework for evaluating RFPs will not only generate buy-in from the people evaluating the request, but also your team members who are responding to them.
In B2B sales, responding to RFPs is often a primary way of acquiring new business or being considered as a qualified vendor. The process of responding takes up valuable time, resources, and collaborative energy, so you want to ensure you are going after the RFPs that will have the strongest impact on your business.
The reality is, not all RFPs are weighted equally, and not all deserve a response. Having consistent criteria to determine if an RFP is worth responding to allows you and your team to be uncomfortably honest in the process of evaluation and enables everyone to remain on the same page.
There are many factors to consider when evaluating an RFP. We’ve assembled a set of criteria and also created a sample RFP intake form for you to use the next time you are deciding whether to respond to an RFP.
Factors To Consider When Evaluating an RFP
The RFP Evaluation Path
- Fit: Does the prospect fall into our target market? Do we know enough about their needs and how to solve their challenges?
- Relationship and Timing: What stage of the sales cycle is the RFP being received? Have we done business with this organization in the past?
- Competitor Language:Are there signs of competitor involvement in the RFP?
- Timeframes and Internal Resources: Is there enough time for a thorough response? Do I have access to my SMEs within the given timeframe?
Consider whether this opportunity is the right fit for your business. If you have done business with a similar company, take a deeper look at past success metrics. If the data indicates that it’s a poor fit and it seems like a long shot, approach with caution.
How much you know about the industry will also help you assess if the opportunity is a right fit. It is important to consider whether the issuing business is part of your target market. If you receive an RFP for an industry that is not relevant to your business, you could be doing your company a disservice by responding.
Questions to ask yourself:
- Do I know enough about the industry?
- Do I know enough about their needs and challenges, and how to solve them?
- Do they fall into my organization’s target market?
- What has my past success rate been for similar companies and industries?
Relationship and Timing
The stage of the sales cycle in which an RFP is received can dictate how you want to proceed. For example, if a tech company has already done a demo and is nearly halfway through the sales cycle with the prospect, the chance for consideration is high. If you have never worked with the company and the RFP is your first touchpoint (also known as a “blind RFP”), your chances for consideration might be lower.
Pursuing blind RFPs is a topic of hot debate. Winning blind RFPs is not impossible. Look to your organization’s previous experience for proof. If you have won many blind RFPs in the past and have data that shows a high success rate, a blind RFP might be worth it for you! If not, you may want to consider a blind RFP a red flag.
Your relationship to the prospect can have a strong influence on the success of a submitted RFP. Access to the decision maker, any stakeholders, or influencers in the decision-making process will give you a leg-up from the competition. With an existing relationship, you’ll have a better sense of the prospect’s needs and timelines, as well as access to ask clarifying questions. Loopio customer, Qualtrics, an experience management software, found that relationship is their number one influencer in winning an RFP submission.
Questions to ask yourself:
- What stage of the sales cycle is the RFP received?
- Have we done business with this organization in the past?
- Will responding give me access to further business down the line?
- Do I have access to key contacts to get more information
Watch out for competitor language in the RFP. You might notice references to specific product features or terminology that a competitor is known for; this could be a sign of a predetermined choice by the prospect or even competitor involvement in creating the requirements.
Timeframes and Internal Resources
Another factor to consider is the deadline and the amount of time and resources it will take you to pull together a well-thought-out response. A request with an extremely tight timeframe will mean a rushed job and a higher likelihood of a missed opportunity. You’ll also need to determine if you have the right resources available as well as access to your Subject Matter Experts (SMEs) within that time frame.
If you are facing a tight time frame, you should take a step back and ask yourself, what is the cost of pursuing this opportunity? Spending 15 hours on a 5k deal is less efficient than spending 25 hours on a 200k deal. Weighing your time against the opportunity will allow you to better prioritize which RFPs to pursue.
Last minute requests might also be a sign the prospect has already selected their vendor. If this is the case, they might only be issuing an RFP to comply with their internal procurement process.
Questions to ask yourself:
- What is the cost of pursuing this opportunity?
- How many people will need to be involved?
- Do I have access and buy-in from the right internal stakeholders to meet this deadline?
Putting Your Criteria into Action
We’ve laid out some criteria for assessing an RFP, but you can take this a step further and make this framework actionable across your entire team by using intake forms.
The six-person proposal team at Qualtrics supports more than 700 sales reps. That’s a lot of proposals per year – over 600 in fact. To deal with the massive amount of proposals coming through the door in a consistent manner, the team developed a mandatory intake form for everyone who receives an RFP to fill out. This allowed for a streamlined go/no-go process for the proposal team to prioritize which opportunities to proceed with. Qualtrics was able to go a step further and integrate this intake form into their CRM to track essential data about their bids. Even if such integration is not possible for your team right now, creating a simple Google Form will make your evaluation process more consistent.
Weighing an RFP against the above criteria will help you gain clarity on the value of a prospective opportunity. Not all requests are worth responding to, and it’s essential to have a documented process for how your team determines if an RFP is worth a response or not.
Start building out or evolving your go/no-go process. See some specific questions you should be answering when evaluating an RFP in this sample intake form. Deciding to complete an RFP is only the first step in the process. The response process itself can still be very cumbersome without a structured way to manage all the moving parts.
Loopio’s RFP response software helps to streamline that process. We conducted a survey in Q2 of 2017 and found our customers were able to save 29% of their time when completing RFPs. We’d be happy to show you how Loopio can make your response process easier.
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