This time of year B2B suppliers often see a substantial uptick in the number of Request for Proposals (RFPs).
Halloween typically signals the seasonal beginning of a deluge of RFPs, as many customers’ fiscal year end coincides with the calendar.
And their Procurement departments remind them of contracts terminating at year’s end.
Voila! A very active bidding season, and what looks like sales treats for suppliers’ reps.
While some customer RFPs are legitimate in seeking new suppliers to fix problems or make improvements, many are hollow RFPs; zombies going through compliance motions to satisfy Procurement; never intending to change suppliers.
To Participate or Not
When sales reps are asked to dance, a natural inclination is to say “Yes,” no matter who’s doing the asking.
But the more sales savvy reps know it’s not wise to “Yes” every RFP. They assess the opportunity first to determine whether to participate. And the easier that process is, the better. Overly detailed processes are easily forgotten, like the name of your elementary school principal.
For those looking for a simple assessment process, here are several basics to consider.
Access to Sales Intel
These are the typical factors to consider when determining if you want to participate in an RFP/Bid opportunity. With little to no sales intel it’s an uphill battle, winnable but a slog. Also, don’t forget about the four painful things you need to know about sales intel.
The primary factors to consider whether you know enough to participate are:
- Customer contacts: Do you know them, and their personal, career and departmental motivations?
- Customers’ business pains & gains: Do you have inside knowledge, or only know what you read online about this customer?
- Past experience: Have you worked with that customer or contacts before, do you know their trustworthiness and integrity? Does this customer have a history of buying low price only?
Visible Customer Commitment
This is akin to reading tea leaves because some worthwhile customers do make a hash of their RFPs. But it’s still worth considering these factors when deciding if you’ll participate.
- Bidding suppliers: Is there a reasonable number, or is it a cattle call for all comers?
- Bidding suppliers: Are they prequalified in a Request for Information process, or can anyone and their brother participate?
- Timelines: Are they reasonable and typical for this type of RFP?
- Site visitations: If typical for this type of RFP, are they scheduled and are they representative of all sites being bid?
- Online Reverse Auction: Is this a common practice for this type of RFP, or are customers sending a message that it’s price only?
Strategic New Business Fit
- Capabilities match: Does the RFP opportunity match what you’re capable of doing well today?
- Dollar size: Does the dollar volume, from initial plus ancillary sales, clear your minimum threshold?
- Growth plans: Does the RFP opportunity provide business in the direction you planned to grow?
- Safety / Risk / Legality : Will you increase your risk profile, and insurance costs, should you win this RFP and begin that business relationship?
Smart, Fast, Easy Choices whether to Participate in RFPs
If you’d like a free, simplistic but customizable tool, click here. It’s in Excel 2010 so you can change it as you like. Make it work for you.