34 RFP Statistics That Will Help You Win More Bids
Whether your organization has a formal proposal team or takes an ad hoc approach to requests for proposals (RFPs), you have a lot to gain from improving your response process. Increased revenue, more efficient sales cycles, and a higher customer retention rate are just a few benefits of better RFP management.
However, creating winning bids is easier said than done. It’s getting tougher for teams to juggle the number of RFPs they receive—especially when they have to contend with tight deadlines and limited resources. And while we don’t have a crystal ball, we do have key trends that are shaping the year ahead for RFP responders.
The following statistics are from Loopio’s second annual 2021 RFP Response Benchmarks & Trends Report, which analyzes data collected from 650+ RFP teams across North America, spanning 15+ industries.
From improving win rates to the disconnect between executives and those managing proposals, here are 34 RFP benchmarks and trends your team can use to improve your response process, make a case for more resources, and ultimately win more business.
Table of Contents:
- RFP Submission Benchmarks
- Average Sales Revenue and Win Rates
- RFP Process and Satisfaction Insights
- RFP Response and Submission Timelines
- RFP Tools & Reporting
- Key Trends Around RFP Management
- 2021 RFP Resources and Predictions
- How to Strengthen Your RFP Responses Now
RFP Submission Benchmarks
1. On average, organizations submit 150 RFPs annually.
On average, organizations respond to 150 RFPs per year—20% submit 51-100 RFP responses, 18% submit 101-250 a year, and 30% submit 11-50.
2. RFP submissions increase drastically with company size.
On average, small and medium sized organizations respond to 54 RFPs, Mid-Market businesses respond to 177, and Enterprise companies respond to a whopping 266 RFPs annually.
3. Organizations with dedicated owners have higher response rates.
Companies with a dedicated proposal manager (or better yet, proposal team) are more likely to have a higher participation rate for RFPs. They’re also more likely to be satisfied with the efficiency of their process.
4. Organizations with an RFP tool submit the highest number of RFP responses.
Teams with RFP software respond to an average of 163 RFPs annually, while those without software respond to only 120 in comparison.
5. Organizations typically respond to two-thirds of the RFPs they receive.
On average, organizations respond to 65% of the RFPs their company receives—meaning most teams deem two-thirds of RFPs to be worth their time to answer. This response rate shows a decline from last year’s average (69%)—which may reflect that teams have become more discerning about the proposals they take on (which ties into our next stat…).
6. Almost three-quarters of teams use a go/no-go process for RFPs.
Before starting a proposal, 72% of teams assess if they’re likely to win using a go/no-go decision template for RFPs. This means that nearly three-quarters of responders consider it valuable to assess customer fit before investing time in a proposal.
7. Team satisfaction strongly correlates with higher response rates.
Teams that are satisfied with their RFP process tend to respond to significantly more RFPs annually, and on average, have higher win rates than those who are less satisfied. This indicates that there is a strong link between satisfaction and performance (which isn’t surprising, considering research shows that happy teams tend to perform better).
Average Sales Revenue and Win Rates
8. The average win rate for RFPs is below 50%.
On average, organizations win 47% of the RFPs they bid on–showing a drop from last year’s average of 53%. This year, the research shows that 16% win fewer than 40% of RFP bids, while another 16% win fewer than 30%.
9. Top-performing teams respond to a higher volume of RFPs.
Top performing teams—who win more than 50% of the RFPs they bid on—submit a higher volume of RFP responses annually. These teams respond to 175 responses annually, in comparison to the average team, which responds to 147 RFPs. With a difference of 28 RFPs per year, it seems that more chances at bat helps hone the skills needed to win.
10. More than a third of sales revenue can be sourced from RFPs.
On average, RFPs generate 35% of a company’s sales revenue. The industries which generate the highest percentage of their revenue from RFPs are technology (hardware, telecom, & IT) with 38%, as well as manufacturing & retail with 38%.
11. Mid-market companies are most likely to generate a higher average percentage of sales revenue from RFPs.
Mid-Market companies (501 to 5,000 employees) seem to generate the most annual revenue (37%) from RFPs, despite having lower annual submission and win rates than Enterprise organizations.
12. A third of RFPs are an attempt to retain existing customers.
On average, 33% of an organization’s RFP responses are contracts for existing customers—meaning a third of the average company’s proposals impact retention dollars vs. net-new acquisition.
RFP Process Insights
13. More than a third of organizations surveyed have a dedicated RFP manager, writer, or team.
Most organizations (37%) dedicate a person or team to manage and own the RFP process. If a company doesn’t have a proposal team, the next most likely owner is sales, closely followed by solutions engineers and consultants.
14. 60% of teams are satisfied with their response process.
Last year’s report asked participants how strongly they felt that they had a clear and straightforward process, and 80% agreed that they did. This year: just 60% of teams report satisfaction with the efficiency of their response process. This sudden drop may be indicative of the quick shift to remote work last year, which has caused some teams to struggle.
15. Less than a quarter of RFPs are completed with fewer than 5 people.
37% of organizations involve between 6-10 contributors, 28% involve 5 or fewer, 21% involve 11-15, and 12% involve 15 or more people in the creation of every RFP.
16. Every RFP involves an average of nine people to complete.
On average, companies involve a total of 9 people in the creation of every RFP—which is nearly two more contributors than last year’s average of 7 people. This increase of contributors is likely due to last year’s increased scrutiny of the buying process due to COVID-19.
17. The average number of people involved in the RFP process increases based on company size.
The number of RFP contributors tends to grow with company size. The larger the company, the more hours spent on an RFP response This may be due to the complexity of proposals and procurement processes at larger companies. It can also be assumed that these organizations take more time because they have larger teams dedicated to proposal writing.
RFP Response and Submission Timelines
18. Average time for writing a single RFP response is 23 hours (or 12 minutes per question).
Writing an RFP response takes an average of 23 hours to complete. Considering the average proposal contains 115 questions—this means each question takes roughly 12 minutes to answer. So the next time you receive an RFP, you can estimate how long it will take to write by multiplying 12 minutes per question. (This doesn’t include time to assess the RFP, format responses, and other submission activities.)
19. The average timeline for submitting an RFP is 1-6 days.
The average RFP turnaround time is 1-6 business days from start to finish (which includes editing, approvals, submission time, and more). One quarter of businesses take 6-10 business days (or 1-2 weeks) to turn around responses, while 15% take 11-20 days (about 2-4 weeks), and less than 10% take more than a month to complete and submit responses.
20. Small companies are most likely to be turning around RFPs in a few hours.
Small & Midsize companies are the most likely to be turning around RFPs in less than five hours. Since more writing time is correlated with higher win rates, smaller organizations may want to assess if they’re creating high quality proposals.
21. More time writing = higher win rates.
While the average timeline for writing a single RFP is 23 hours—top-performing companies spend an average of 25 hours on each RFP. That total of 2 more hours writing appears to pay off with superior win rates.
RFP Tools & Reporting
22. Metric tracking can lead to higher win rates.
There is a positive relationship between tracking revenue metrics and the percentage of RFPs won. Research shows that 91% of top performing RFP teams track metrics for success.
23. Most commonly tracked metrics focus on revenue and the number of bids won.
The most commonly tracked metrics include revenue won from RFPs (48%), closely followed by number of bids won (45%). Only a small percentage of teams are tracking employee satisfaction or sentiment (16%).
24. Best-in-class teams go beyond revenue tracking metrics (hint: think about people and process).
Top performers track quantitative RFP revenue and volume-related metrics, as well as qualitative measures like team performance and employee sentiment. A focus on process metrics, employee happiness, productivity, and performance is likely giving organizations a winning edge.
25. The majority of companies actively use RFP tools and software.
69% of organizations use a dedicated RFP response or proposal management software. The top reasons cited for using an RFP solution are improvements to RFP content storage (65%), closely followed by time savings (63%), and the automation of manual tasks (53%).
26. Teams that use RFP software submit 43 more RFPs annually.
Response teams who use a dedicated RFP response software submit an average of 163 RFPs annually, which is significantly higher than the 120 submissions from those who don’t use RFP software.
27. Adopting RFP software can lead to higher team satisfaction.
RFP software users are significantly more satisfied with all aspects of their RFP process compared to their counterparts. Top benefits include response speed, volume, proposal quality, and overall process efficiency. They also involve two more contributors than average in their response process.
Key Trends Around RFP Management
28. Top challenges in the response process center on managing RFP content.
The most common issues in the RFP process are:
- Finding up-to-date accurate answers (46%)
- Collaborating with subject matter experts (SMEs) (44%)
- Choosing the right answers from a group of potential answers (40%)
All of these issues highlight the need for better content management for a successful RFP process.
29. COVID-19 made an impact on 2021 RFP response targets.
When asked whether COVID-19 affected RFP response targets for 2021, a third of teams surveyed (34%) said yes, it did. About a quarter (26%) stated changes in submission targets were for other reasons, while a fifth were unsure.
30. Despite best efforts, RFP revenue and win rates dropped 6% between 2020 and 2021.
The average volume of RFP submissions rose from 147 in 2019, to 150 in 2020. So in spite of effort levels remaining roughly the same, RFPs yielded less fruit from a revenue perspective this past year. Sales revenue sourced from RFPs dropped by 6%, and win rates are down 6% overall.
31. There are disconnects between Executives and Associates in the RFP process.
Executives and Associates don’t always see eye-to-eye on key success metrics or overall process sentiment, nor are they aligned on the top reasons for losing RFPs. The survey shows that senior leaders are more likely to attribute a loss to proposal quality, missed deadlines, or bad fit.
On the other hand, Associates are most likely to attribute loss to pricing, a competitor’s offering, or the fact that a competitor was favoured from the start. Better win/loss analysis, shared visibility for key metrics, and soliciting more employee feedback could bridge the gap and help organizations improve their win rates.
2021 RFP Resources and Predictions
32. Companies plan to invest in team training and tech in 2021.
The top areas for RFP resource investments in 2021 are team training (34%) and new technology (32%). This is a noticeable difference from last year’s focus of hiring more staff (which could reflect headcount being less of a priority due to economic uncertainty).
33. 47% of organizations intend to submit more RFPs in 2021.
Almost half of organizations (47%) say they plan to increase the number of RFPs they respond to in 2021. While this is a significant number, it is 17% lower than last year’s predictions. This change can likely be attributed to widespread economic slowdown and increased scrutiny on spending caused by COVID-19.
34. RFP process improvement recommendations focus on content management.
When asked what actions their company should take to win more RFPs in 2021, the top actions respondents chose were requiring SMEs to answer requests in a more timely fashion (29%), improving to how they find and maintain their RFP content (27%), and implementing a smoother response process (27%).
This implies that participants see timely information sharing as the greatest area for improvement.
How to Strengthen Your RFP Response Process Now
Having an effective and efficient RFP response process can help your organization complete more responses and close new business faster.
Download Loopio’s second annual 2021 RFP Response Benchmarks & Trends Report to learn more and dive deeper into the behaviours of top-performing companies while benchmarking your own performance.
This article was originally published in January of 2020. It was updated in 2021 to reflect the new research from our annual benchmarks and trends report.
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