When working through a proper sourcing process, one important step to understand is dealing with a Request for Quotation (RFQ). This is a standard business process that allows suppliers to place bids on specific products or services. Here are 3 great tips to a get the quotes you are looking for when submitting your Request for Quotation.

Discussing a request for quotation with potential vendors

1. Send Out Detailed RFQs
To receive correct and accurate quotes, RFQs should include detailed specifications of the items/services listed in order to make sure all of the suppliers are bidding on the specific item/service. You could even attach a specification sheet when requesting a quote, but be wary of sending proprietary information to unknown suppliers. Logically, the more details provided, the more accurate the quote will be.

With your RFQ you can include the following:

  • Specification Sheets
  • Additional technical drawings and pictures
  • Sizes and dimensions
  • Material specification
  • Packaging requirements
  • Production methods
  • Types of samples

2. Understand and Submit Additional Relevant Information
It is important to understand the import/export regulations or any additional taxes/tariffs on the product you would like to import.

For example:

  • Foreign trade regulations and restrictions on the product in China and the customer’s country
  • Certification requirements by the customer or the government of the customer’s country
  • Patent and intellectual property information as necessary
  • VAT and other taxation issues
  • Product classification for export/import duties

In most cases it is a good idea to submit more information to get better pricing or terms on the quotation. For example, if your first order is small, but have a large annual order volume, you can negotiate better pricing.

Here is a list of some items that you could include with your RFQ:

  • Order quantity (annual)
  • Target price (you could always include this on the negotiation segment of the RFQ if your target wasn't met)
  • Type of quotation expected (FOB, CIF, etc)

3. Follow up after submitting the RFQ
After submitting an RFQ, it is a good idea to try to receive at least three quotations from different factories per item. Also, after submitting your RFQ, you can increase your opportunities for receiving a better quotation by doing the following:

  • Establish a friendly relationship with the supplier representative. It can only help your cooperation and ease of communications.
  • Explain to the factory any special details for the item.
  • Emphasize the order details with the vendors by reiterating order quantities, payment terms, timelines, and so on.
  • Double check the quotation to make sure the details are correct.
  • Check for any additional fees such as mold fees, packaging, etc.
  • Make sure your order meets the Minimum Order Quantity (MOQ)

The above are a few tips on how to deal with a Request for Quotation and how it can help you obtain the quotes you are looking for from vendors. A proper Request for Quotation process with multiple suppliers will give you the opportunity to compare and negotiate better pricing.

Good luck on your RFQs!