Understanding Request for Quotations (RFQ)

A Request for Quotation (RFQ) is a document you send to vendors asking them to provide pricing for specific products or services. It's a key part of the procurement process.

#Overview

RFQs help you compare vendor pricing before committing to a purchase. You can send the same RFQ to multiple vendors and evaluate their responses to choose the best offer.

#RFQ Workflow

Draft → Sent → Received → Converted to PO └── Cancelled

1. Draft: Create and edit the RFQ
2. Sent: RFQ sent to vendor(s)
3. Received: Vendor responds with pricing
4. Converted to PO: Accept and create Purchase Order

#Key Information

#RFQ Header

• Vendor: Who you're requesting a quote from
• Request Date: When the RFQ was created
• Response Deadline: When you need the quote by
• Reference: Your internal tracking number
• Currency: Which currency for pricing

#RFQ Lines

Each line specifies what you need:

• Product: What you want to purchase
• Quantity: How much you need
• Unit of Measure: Units (each, kg, hour, etc.)
• Expected Price: Optional budget guidance
• Delivery Date: When you need it

#Vendor Response

• Unit Price: Vendor's quoted price
• Lead Time: How long until delivery
• Validity: How long the quote is valid
• Notes: Special terms or conditions

#Creating an RFQ

1. Navigate to Purchases > Request for Quotations.
2. Click Create RFQ.
3. Select the vendor.
4. Add products and quantities.
5. Set response deadline.
6. Click Send RFQ to email to vendor.

#Comparing Quotations

When you receive responses:

1. Open each received RFQ.
2. Review prices and terms.
3. Compare side-by-side if available.
4. Select the best offer.
5. Convert winning RFQ to Purchase Order.

#Converting to Purchase Order

Once you accept a quotation:

1. Open the RFQ.
2. Verify all details.
3. Click Create Purchase Order.
4. Review and confirm the PO.

#Best Practices

1. Request Multiple Quotes: Compare at least 2-3 vendors
2. Be Specific: Clear descriptions get better quotes
3. Set Realistic Deadlines: Give vendors time to respond
4. Document Decisions: Record why you chose a vendor
5. Track Response Rates: Note which vendors respond reliably

#Related Topics

• Understanding Purchase Orders
• Vendor Bills
• Understanding Vendor Management