RFQ software for fast, fair quotes.

What an RFQ is and when to use one

A request for quotation is a short, structured request sent to a defined set of suppliers asking them to price a requirement that is already well specified. The buyer knows what it wants, the market can supply it without redesigning the solution, and the decision turns mainly on price, availability and basic capability. That is the test for using an RFQ rather than a fuller tender: if you need suppliers to propose a method, an RFQ is the wrong instrument.

The distinction from a request for proposal matters practically. An RFP asks how you would solve this problem and is scored on quality as well as price. An RFQ asks what you would charge to deliver this defined thing. An invitation to tender sits in between or above, depending on the organisation's language. Using an RFQ where the requirement is genuinely ambiguous produces quotes that cannot be compared, and a re run three weeks later.

RFQs dominate the high volume, lower value end of public buying. A single council may run several thousand a year across directorates. Because each one is small, nobody builds a process for them, and because there are thousands, the aggregate spend and aggregate risk are substantial. This is the classic long tail problem in public procurement.

Below threshold rules under the Procurement Act 2023

Below threshold contracts are not outside the regime. The Act applies specific duties to them, including publication requirements for contracts above a lower notification level, restrictions on how buyers may restrict participation, and a prohibition on requiring suppliers to hold particular qualifications or audited accounts where that is not proportionate. Buyers must also have regard to the participation of small and medium sized enterprises.

Two features matter most day to day. First, contracting authorities generally cannot exclude suppliers from below threshold competitions purely on the basis of not being on a list, though they may restrict by supplier location in defined circumstances for certain authorities. Second, transparency applies: notices are required at the relevant points for qualifying below threshold contracts, and contract details must be published in the specified circumstances.

On top of the statutory duties sit organisational rules. Every public body has contract standing orders or procurement rules that set internal thresholds: one quote up to a value, three quotes above it, formal tender above that. These internal rules are the ones auditors test most often, because they are the ones officers under time pressure are most likely to bypass. A waiver or single tender action should be an exception with a recorded reason, not a habit.

• Check the aggregate value of the requirement, not just this order
• Do not artificially split a requirement to stay under a threshold
• Apply your own standing orders on number of quotes required
• Publish the required notices for qualifying below threshold contracts
• Keep conditions proportionate so smaller suppliers can realistically bid

How a compliant RFQ process runs step by step

Start with the requirement. Write a specification tight enough that two suppliers reading it would quote for the same thing: quantity, specification or standard, location, timescale, acceptance criteria, and anything the supplier must be told about site access, working hours or security. Ambiguity here is the root cause of most non comparable quotes and most post award disputes about scope.

Then choose the supplier list. The list should be defensible: how were these suppliers identified, is it the same three every time, and does the selection give smaller and local suppliers a realistic route in? Rotating lists, using a Dynamic Market as the source, or advertising the opportunity openly are all better answers than the informal habits that build up in busy teams.

Issue the same information to everyone at the same time, run clarifications so that every question and answer is shared with all bidders, and hold a firm deadline. Receive quotes into a controlled point rather than individual inboxes. Evaluate against the criteria you published, record the decision and the reason, notify all bidders, raise the order or contract, and file the record where audit will find it.

Getting comparable quotes

The commonest RFQ failure is receiving three quotes that cannot be compared. One includes delivery, one does not. One prices a two year term, one prices a year. One quotes for a superior specification because the supplier assumed you wanted it. The buyer then either picks on gut feel or goes back round the loop, and either way the audit trail is weak.

The remedy is a pricing schedule rather than a free text price. Give suppliers the lines to price, the units, the quantities and the assumptions, and state explicitly what is included and excluded. If you want variants or optional extras, ask for them in a separate section so the core comparison stays clean. If you want a rate card, define the roles or units so rates mean the same thing across suppliers.

Set out how you will decide before you issue. Lowest compliant price is a perfectly legitimate basis for a straightforward RFQ, and saying so is more honest than pretending to a quality assessment you will not really carry out. Where quality does matter, use two or three short pass or fail requirements plus price, rather than a full weighted model that is disproportionate to the value.

Speed, and why it decides supplier behaviour

Suppliers bidding for lower value work make a rational calculation about effort. If your RFQ takes two hours to respond to, requires documents they have already given you three times, and comes with a purchase order raised six weeks after award, good suppliers stop responding and you are left with whoever is least busy. Process friction is a price you pay in the quotes you receive.

The fixes are unglamorous. Reuse supplier information already held rather than asking again. Keep the response format short. Give a realistic but firm turnaround. Answer clarifications quickly. Tell unsuccessful suppliers promptly and briefly why they were not selected, because a supplier who understands why they lost will quote again. Pay on time, because payment performance is both a policy expectation and the single strongest driver of whether a small supplier will bother next time.

Internally, speed protects compliance. When a compliant route takes three weeks and the service needs the work done on Monday, officers go around the process. Most non compliant spend is not misconduct, it is a rational response to a slow system. Make the compliant route the fastest route and the compliance problem largely solves itself.

Aggregation, contract splitting and off contract spend

The single biggest risk in below threshold buying is fragmentation. Fifty separate orders for the same category of goods across a year may add up to a value that should have been tendered. Artificially splitting a requirement to avoid a threshold is prohibited, and even where splitting is not deliberate, the aggregate exposure is real: no contracted rates, no service levels, no leverage and no view of total spend.

The way to find this is spend analysis. Classify purchase ledger data by category and supplier, look for recurring low value spend with the same suppliers, and test whether a call off arrangement, a framework, or a Dynamic Market would serve the requirement better. Categories such as agency staff, minor building works, print, training and equipment hire are where the pattern usually shows first.

Once a better route exists, the harder job is channelling demand into it. Publish a simple guide for budget holders that says, for this category, use this route. Put the route into the system so that raising a request naturally lands in the right place. Report off contract spend to management by directorate, because visibility changes behaviour faster than policy documents do.

RFQs, Dynamic Markets and frameworks

An RFQ does not have to be run from a blank page. If the requirement falls within a framework you can use, a further competition among appointed suppliers is often the fastest compliant route, because qualification has already been done and terms are already agreed. Direct award is possible under some frameworks where the criteria permit it, but check the framework's own rules rather than assuming.

Dynamic Markets, which replaced Dynamic Purchasing Systems under the Procurement Act 2023, are particularly well suited to the RFQ layer. Because a Dynamic Market is permanently open and membership cannot be capped, the pool of qualified suppliers keeps refreshing, which addresses the classic complaint that the same three firms always get asked. Applications must be assessed within a reasonable time, and a pending application must be considered before a competition concludes.

That structure lets a buyer run fast, light competitions among members with confidence that due diligence sits behind them. For utilities in water, energy and transport there is an additional dimension: they may charge suppliers membership and award fees and may run member only tenders, which general contracting authorities may not do. Our Dynamic Markets page sets out how membership and call off competitions work in practice.

Evidence, audit and what goes wrong

An RFQ file that satisfies audit is not complicated, but it has to exist. It shows the requirement, the value estimate and the route chosen with reference to standing orders, who was invited and why, the documents issued, the clarifications and the answers given to all, the quotes received with their receipt time, the evaluation against stated criteria, the decision and approval, the notification to bidders, and the resulting order or contract.

The typical audit findings are predictable: quotes obtained after the order was placed, only one quote where three were required, the same supplier used repeatedly without competition, no record of why a supplier was selected, waivers approved retrospectively, and evidence held in personal mailboxes so it cannot be produced when the officer has left. None of these are exotic. All of them are process design problems.

There is a conflicts of interest dimension too. Low value buying is where personal relationships have most influence, because there is least scrutiny. Requiring a simple declaration from the decision maker, and separating the person who specifies from the person who approves, costs almost nothing and prevents the situations that become serious later.

• Order raised before quotes were sought
• Fewer quotes obtained than standing orders require
• Repeat use of one supplier with no competition or waiver
• No written rationale for the award decision
• Records held in individual inboxes rather than a system of record
• Retrospective waivers used to regularise decisions already taken

How eSourcing Data handles RFQs and below threshold buying

eSourcing Data covers source to contract in one platform, and includes dedicated below threshold workflows precisely because this layer behaves differently from major tendering. A quick quote route lets an officer describe a requirement, select suppliers from the supplier record or a Dynamic Market, issue a structured pricing schedule, and run the competition to a deadline without building a document pack from scratch.

Because supplier onboarding and assurance sit in the same platform, information already held is reused rather than requested again, which is what makes fast turnarounds realistic for suppliers. Clarifications are shared to all bidders automatically, quotes are received into a controlled point with timestamps, and evaluation and award are recorded against the criteria that were published, producing the audit file as a by product of doing the work.

The reporting layer then answers the questions that below threshold buying usually cannot. Where is low value spend concentrated, which categories are fragmenting, which suppliers are used repeatedly without competition, how long does a quotation cycle actually take, and how many small and local suppliers are winning work. The platform has UK data residency and is GDPR compliant.

eSourcing Data software is available to public buyers through RM1557.15 G-Cloud 15, with 28 software services listed on the Digital Marketplace alongside cloud support services, bought as call off contracts. The service directory sets out what each service covers.