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RFT, RFP, RFQ ? What’s the Difference?

Most opportunities listed on Austender are issued as a standard Request For Tender(RFT). However, from time to time Requests for Proposal (RFP) and Requests for Quote (RFQ) are also issued. So what’s the difference? Government departments will use varying approaches to market depending on the detail required to make an evaluation, or on the level of detail government might have to determine a requirement.

Request for Tender: This is an open competitive process in which a series of requested documents must be submitted which usually includes a proposed solution and detailed costing. The tender response will require you to complete a series of schedules and the format and level of detail will vary depending on the requirement. An RFT will also contain a detailed set of draft contract conditions which cover items such as liability, intellectual property and warranties against which you will be require to identify your level of compliance for future negotiation. RFTs will require a detailed evaluation which includes compliance and risks assessments, prior to determining the preferred tenderer and commencing a negotiation period.

Request for Quote: Unlike the level of detail in an RFT, an RFQ simply requires the submission of a cost against a known item/product and usually takes the form of a page of line items to quote against. For example, an RFQ requesting a specific type of Pallet, may include the specification on the pallet, as well as quantity and the respondent will only need to advise on cost and delivery time. RFQs are supported by a set of standard terms and conditions which are fairly simple in nature and for the most part are non-negotiable. However departments do have the opportunity to add in ‘special conditions’ to provide additional coverage to suit a particular procurement/tenderer. RFQs in most cases will simply be evaluated on cost and delivery time, with a tenderer awarded in a short time frame and limited to no negotiation period.

Request for Proposal: An RFP is slightly different again and is used when a department does not have a particular solution in mind and instead is seeking industry proposals. Unlike an RFT where funding for the procurement is approved, an RFP usually does not have a budget allocated as the requirement is yet to be refined. It is through the RFP process that a department gains an estimate of possible budget required, and the information necessary to refine the actual requirement. Furthermore, an RFP can then lead onto a restricted RFT process, where only respondents to the RFP stage are asked to tender. Although there are no guarantees that the procurement will take place, an RFP provides greater opportunity for industry to shape the possible future solution, thereby giving you an edge in bidding on any future rounds.

Before embarking on any bid, it’s important to take note which type of opportunity is on offer in order to plan the resourcing and strategy required for your bid.

Current tenders are listed here with further details on AusTender.

If you require any further assistance or advice feel free to contact Engineering Business for all your tendering needs.

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