What Is an RFQ (Request for Quote)?
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Talk to our experts- RFQ (request for quote)
- An RFQ (request for quote, or request for quotation) is a request a buyer sends to one or more suppliers asking for a price on specific products or services. It often includes the item specifications and can ask for terms such as payment terms. RFQs suit standardized purchases where price is the main factor in choosing a supplier.
Also called: request for quotation
How it works
An RFQ is a business process, and it runs in stages:
How an RFQ runs
The RFQ often includes the item specifications so all suppliers bid on the same thing, and can ask for payment terms or contract length.
Suppliers return their bids by a set date and time to be considered for an award.
Discussions may be held on the bids, often to clarify technical capabilities or note errors, and multiple rounds can follow.
Professional procurement teams compare the quotations and try to get the best price, through negotiation or an e-auction.
Among the quotations the suppliers provided, the best one is selected.
RFQ vs. RFP vs. RFI. An RFQ is used when price is the main or only factor in selecting a supplier and discussions with bidders are not required. A request for proposal (RFP) asks the bidder to produce an original business proposal based on the buyer's needs, and it is usually part of a complex sales process. A request for information (RFI) is not an invitation to bid, and it is typically followed by an RFP or an RFQ.
Example
A buyer needs 500 stainless brackets on net 30 payment terms and sends an RFQ to three suppliers.
- Supplier A quotes $4.20 per unit: 500 x $4.20 = $2,100.
- Supplier B quotes $3.95 per unit: 500 x $3.95 = $1,975.
- Supplier C quotes $4.10 per unit: 500 x $4.10 = $2,050.
The buyer accepts Supplier B's quote and orders at $1,975.
On Shopify
On the supplier side, a quoted price can go on a Shopify B2B draft order. If you need to quote a negotiated price that differs from the company's catalog pricing, you can set a custom price on the line item. You can lock prices to maintain a quoted price, then send an invoice for payment.
A company location can also be set to submit all orders as drafts for review, which shows buyers a Submit for approval button in the checkout. Those orders land on the Drafts page with prices locked by default. Draft order to invoice and checkout to draft are both available on the Basic, Grow, Advanced and Plus plans. Where a business wants a request-for-quote form on the storefront, an app or a custom build can add one.
How Uncap helps
Plenty of B2B orders start as a quote, not a checkout. Uncap Quotes runs the full configure, price, quote process inside the Shopify admin you already use, and when the buyer says yes, the approved quote becomes a Shopify order in one click.
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Frequently asked questions
How does an RFQ work?
The buyer sends suppliers the specifications and any terms to be priced, the suppliers return quotations, and the buyer selects the best one.
What is the difference between an RFQ and an RFP?
An RFQ asks for a price when price is the main or only deciding factor. An RFP asks the bidder for an original business proposal based on the buyer's needs.
How to write a request for quotation?
Include detailed specifications for each item or service so all suppliers bid on the same thing, and list the terms you want quoted, such as payment terms or contract length.
