What is a request for quotation (RFQ)?

An RFQ is a process where a customer requests a quotation from specific suppliers. A customer can be a company or public entity and the supplier can be a producer or contractor. Furthermore, the RFQ line items to be quoted can be either goods, services, or a mixture of both.

Ultimately the customer’s decision-making process is based on the information submitted in the quote for price, payment terms, delivery terms, delivery time, quality requirements, and other such minimum qualifying criteria.

The customer can include information in the RFQ of their preferred requirements, but the supplier can choose to quote whichever terms they want. However, a supplier is more likely to have their quote approved if they meet the terms offered by the customer.

What format should an RFQ be in?

It’s common to use templates which can be in the format of word documents, excel forms, and PDFs. Attachments and other supporting documents can be in a variety of forms depending on the software used to create them, for example, technical drawings made in CAD software submitted in DWG format.

Some companies have RFQ submission forms integrated into their website or use 3rd part portal systems that allow the supplier to log in to submit their quote. Still, to this day, the most common mechanism for communication between customers and suppliers is email, with the most typical format being an excel form with general and product-specific information. Supporting files are added to the email as attachments, and the email body contains an appropriate, professional introduction and a brief explanation of the RFQ.

Request for Quotation Template – Excel Example

Request for Quotation Template – Excel

What information should be included in an RFQ?

General information

• Your company name
• Payment terms
• Delivery terms
• The currency that you want to accept the quotation in
• The validity period, or the last date that you will accept quotations in response to the RFQ
• A description of the specification and any comments
• Delivery time from order

Product-specific information

• Part code
• Part revision
• Part description
• Part quantity
• Unit of measurement (UOM)
• Minimum order quantity (MOQ)
• Part weight
• Gross weight
• Volume
• HS code
• Bill of materials (BOM) level where applicable. Different formats are used to show a branching structure, for example, 0, 1, 2, 2, 2, 2, 2, 2 (pictured) with a main part, that has a child part, which in turn has 6 child parts. The same BOM can also be defined as 1, 1.1, 1.1.1, 1.1.2, 1.1.3, 1.1.4, 1.1.5, 1.1.6 and retain the same structure.
• Target price
• Currency code

Information that you can also include in an RFQ

• Company logo
• Data on previous nonconformities related to the parts in the RFQ
• Product notes
• Additional descriptions
• Files such as technical drawings, project briefs, or a company presentation
• Terms of Service (ToS)
• Project description

Request for Quotation PDF – Example

Request for Quotation Template – Word

Sending professional-looking documentation as a customer or supplier is always a good idea, as is having a standardized way of working. This will not only benefit your team but will also improve the efficiency of working with the same partners in the future. Often this pre-business, strategic data process can be overlooked meaning that a company has no evidence to demonstrate why certain decisions were made. Do you have a dedicated set of tools and a standardized way of working with RFQs and quotes?