Procurement RFx dictionary
Lately, our CEO sparked a discussion on LinkedIn about the term of RFS. Is it the same as an RFP? We stand our ground that it is basically the same thing.
We prefer to use the holy trinity of RFI/RFQ/RFP to categorise procurement requests. Yet there is a whole alphabet of acronyms going around that often mean just about the same (if not exactly the same) things. OR the same acronym can mean two different things.
Have you heard the joke that it was all fun and games until the Devil said: “let’s put the alphabet in maths”?
Sometimes it feels the same way with procurement.
On the one hand, it’s no wonder many procurement professionals have worked in the field for years and still don’t know them all correctly. On the other hand, as one of the comments bluntly put it, then is it any surprise that procurement resides somewhere in the corporate basement.
Here’s a quick dictionary of different RFx related procurement acronyms.
Firstly, come the three most common terms, RFI, RFQ and RFP. You can read more about these in our blog post: Mysterious RFx - what’s the difference between RFI, RFP, and RFQ?
- RFI, a request for information - is a proposal requested from a potential seller or a service provider to determine what products and services are potentially available in the marketplace. It’s used in supplier market research and to initiate the supplier selection process. An RFI, however, is not an invitation to bid, is not binding on either the buyer or sellers and may or may not lead to an RFP or RFQ.
- RFQ, a request for quotation - is used when the buyer knows exactly what product or service they need and the price is the main or only factor in selecting the successful bidder. In commercial business practice, the RFQ is the most popularly used form of RFx.
- RFP, a request for proposal - is used when the buyer has a problem but does not know how to solve it. Then they ask suppliers to come up with different solutions (i.e., proposals) and maybe identify the accompanying cost estimation.
But a variety of other acronyms are used as well.
- RFA, a request for association - also known as a request for partnership or request for an alliance, is a proposal for getting into business together.
- EOI, expression of interest - discovery process to gather information for the potential procurement of the services sought, similar to the request for qualifications (RFQ).
- RFEI, a request for expression of interest - is part of the EOI (expression of interest).
- ROI, a registration of interest - basically the same as RFEI.
- RFQ, a request for qualifications - (yes, another RFQ) is a document often distributed before initiation of the RFP process. It is used to gather vendor information from multiple companies. This eases the RFP review process by preemptively short-listing candidates.
- PQQ, pre-qualification questionnaire - the same as RFQ (request for qualifications).
- RFS, a request for a solution - is similar to an RFP, but more open and general. This allows the vendor or supplier the most flexibility in proposing a solution.
- RFT, a request for tender - more commonly used by governments.
- ITT, an invitation to tender - the same as RFT.
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