What is a request for quotation (RFQ)?
A request for quotation (RFQ) is a buyer’s written request to suppliers to price goods or services it has already specified. For a bid team, responding means pricing the buyer’s specification, including lead times, in a quotation the bid manager signs off on before the deadline.
On this page
The buyer specifies what it wants to buy, sends it to suppliers with a deadline, and compares the quotations that come back, mostly on price. In public and private procurement, the RFQ is the request a buyer sends once its requirement is settled, part of the family of RFx documents. The supplier’s answer is a quotation: its prices and lead times for that requirement, whereas an answer to an RFP proposes how to meet a need.
In construction and design procurement, RFQ can also stand for request for qualifications, which screens firms on their experience and credentials.
How does an RFQ work?
What the buyer sends
A buyer sends an RFQ once it knows exactly what it needs and wants suppliers’ prices. Before the request goes out, the buyer sets out each item in a specification, line by line. Once the RFQ arrives, the bid team knows the requirement is settled and that its work is to price what the specification describes.
An RFQ typically sets out the specification, quantities, delivery requirements, commercial terms such as payment terms, the evaluation criteria, and a submission deadline. Its pricing schedule lists each item on a row, with its quantity.
What the bid team sends back
The supplier responds with a quotation that includes prices and lead times. On the pricing schedule, the team’s commercial colleague enters a unit price, a line total and a lead time on each row.
A subject matter expert checks each row against the specification so each price the buyer reads matches the item it describes. The bid manager signs off the quotation before the deadline, because the totals the buyer compares are prices the organisation will have to stand behind.
Where does an RFQ sit in the buying process?
Before the RFQ
An RFI comes earlier, before the buyer asks anyone for quotations or proposals.
By the time the RFQ reaches the bid team, the buyer has written down its requirements. The only remaining variables are the price and lead time for each row.
How quotations are compared
Price is usually the main factor when a buyer compares quotations. The buyer’s procurement team sets the totals from each supplier’s pricing schedule side by side.
Because the comparison runs on those totals, every row the team prices to the specification counts toward the figure the buyer weighs most.
After the award
An RFQ award usually turns into a purchase order to the chosen supplier, sometimes with a contract or purchase agreement alongside it.
What do procurement rules say about RFQs?
When a public buyer can use one
The UNCITRAL Model Law on Public Procurement is a model that states can enact, and a state may leave out any of its methods, including request for quotations. The rules a public buyer follows determine whether it can send an RFQ at all, whether a quotation may change once submitted, and what wins the award.
Where a state has kept the method, a public buyer may use it only for off-the-shelf goods or services that are readily available and sold in an established market. The estimated value must also be below a threshold set by the procurement regulations.
What you can rely on while you quote
Under the Model Law, each supplier asked for a quotation must be told whether charges beyond the item’s own price, such as transport, insurance, customs duties and taxes, belong in it. In a regional health authority’s laptop pricing schedule, the delivery line tells the team whether the figure includes delivery to hospital sites.
When the team asks about a line of the specification, the buyer answers if the question arrives in reasonable time before the deadline. It sends that answer to every supplier, without naming who asked.
Once the quotation is in
Under the Model Law, each supplier gives one quotation and may not change it. In contrast, a bid in open tendering may be modified or withdrawn before the deadline unless the solicitation documents say otherwise. As a result, the bid manager’s sign-off before submission is the last point at which the team can fix a wrongly priced row.
The buyer and the supplier may not negotiate over a quotation once it is in. The buyer may ask for a quotation to be clarified, provided there is no substantive change and no change in price. An arithmetical error is corrected, as when a row on the team’s schedule shows a line total that does not match its unit price and quantity, and the team is told.
Under these rules, the successful quotation is the lowest-priced one that meets the needs set out in the request. A competitor’s lower-priced quotation for a laptop with less memory than the specification requires does not meet those needs, so its lower price cannot win the award.
How is an RFQ different from an RFP or ITT?
RFQ and RFP
An RFP asks suppliers to propose an approach or a solution to a need, with questions for the team’s writers and subject matter experts to answer.
An RFQ asks what a requirement the buyer has already set will cost, so the team’s answer is the priced schedule.
RFQ and ITT or tender
Under open tendering, a bid can win as the most advantageous on stated criteria that include more than price, according to the UNCITRAL Model Law on Public Procurement. An ITT that weighs quality alongside price includes award criteria, weightings, and scored questions for the team’s writers.
On an RFQ, the team has no scored questions to write, and its pricing schedule is its whole answer.
What SEQUESTO does with an RFQ
An RFQ leaves the team nothing to write, only a pricing schedule, so what SEQUESTO brings to it is control: compliance checks, each row routed to the right people, and the bid manager’s sign-off on price. When an RFQ pack is uploaded to a project, SEQUESTO identifies it as an RFQ by its wording, structure, and metadata, or the bid manager chooses the type during upload. SEQUESTO handles each RFx type differently, and for an RFQ, the output is pricing tables.
Specialist agents in Agent Force pull the deadline, mandatory attachments, specification lines, and evaluation criteria into the project so that the team can check compliance before submission. They also turn each dated requirement into a task list, and James adds the organisation’s sign-off stages and financial verification points as milestones, each with a named reviewer and time set aside.
The team’s RFQ workflow, saved as a template with its own approval chain and contributor roles, routes each row to the colleague who prices it and the subject matter expert who checks it. Each row can have its own reviewer and approver. The team sees what the agents did and decides whether to accept, reject or change it.
The bid manager approves the final quotation, which exports in the structure the pricing schedule arrived in, and a team member submits it through the buyer’s portal. Every approval is logged with who gave it and when.