Request for Information (RFI)

Working with the right vendors can help businesses unlock new opportunities and maximize profitability. To shortlist vendors and evaluate their capabilities, companies often rely on a request for information (RFI). 

What is a Request for Information?

A request for information, otherwise known as RFI, is a business process for collecting written information about the capabilities of various suppliers of goods or services. It is a document primarily used to get additional information about the supplier, with no commitments to engage in a project later. 

Usually, the request for information is disseminated in the form of a questionnaire and is used for comparative purposes. The data is then used to decide whether to qualify a vendor or not. The steps following a RFI often include: 

• Request for proposal
• Request for tender 
• Request for quotation
• Contract negotiations

Key Elements of an RFI

Here are the key elements that a RFI should include:

1. Background: This should give vendors context about your business organization. It should also explain your goals and objectives. 
2. Qualification or requirements: What are the skills your vendor must have? What are the evaluating criteria?
3. Order information: The RFI should include details regarding the goods required and quantities. 
4. Any specific questions: Some organizations have specific criteria for qualifying vendors. They can ask those with an RFI. 
5. Deadline: The time by which the vendors should submit their responses for the RFI.

Benefits of Using RFIs

A request for information provides you information about the vendors while benefiting your business in several other ways.

1. Saves Time and Resources

The most obvious benefit of opting for a request for information is that it saves your company’s valuable time and resources. It allows organizations to gather information from different vendors quickly and efficiently.

2. Streamlines the Procure-to-Pay Process 

A request for information enables you to gather information through a formal process and compare it with other responses. With the RFI, you find out whether the vendor is capable enough to meet your procurement needs or not. 

3. Promotes Healthy Competition

Suppliers will know that they are competing for a company’s business, which promotes healthy competition and ultimately leads to reduced prices. It also indicates that the business is acting without any prejudice towards particular suppliers. 

Manage Vendors Effectively Through a Digital Platform

Digitizing RFIs and working with vendors through an online platform reduces the need for excessive back-and-forth, and ensures information is available through a centralized database. 

SoftCo Vendor Management lets you work more efficiently with preferred vendors, offering greater visibility into transactions and allowing for seamless vendor onboarding. It saves employees’ time and lets vendors manage their profiles through a self-service portal. It also allows businesses to track compliance obligations for AML.