The Joy of RFIs, RFQs and RFPs

You've probably dealt or written all three of the above documents yourself at some point, but in government they take on a different meeting. 

Take the RFI -- Request for Information. You do this on Google when you scan the specs for that new tablet you're thinking of buying, or read the box your new edger comes in for the warranty info. Your looking for data -- information on a product or service. No commitment, just interested. It's easier to get RFI info on established brands than it is on new products.

I worked in computer hardware, software and services purchasing for the State of NJ -- for a long time. Writing official RFIs to companies became very easy. In many cases I'd simply call a vendor and request they send me detailed product or service info by mail, or later, by email attachment. Sometimes I had to go back to the vendor for more info. Whether I called or wrote there had to be a record of it. That's government. 

Well, that should be government, and clerks and managers and others call vendors all the time for information . . . and don't document it. I always wrote every phone call down. I didn't have to, but it came in handy many times.

Circa 2007 I wrote an official two-page RFI to three online reverse auction vendors, for an energy procurement we were considering. It was also an RFQ. I had already done the preliminary research on the net and potential companies websites, so I knew what questions to ask, and how to phrase them so they weren't too restrictive. Three responses became a selection of one of the vendors, World Energy, and I had to follow up that RFI/RFQ with a Request for Waiver of Advertising so we could procure the service. 

It was a big contract. WES would get 3% of the value of the contract -- hundreds of thousands of dollars. So it was all done very carefully and above board. That meant even tho we had selected WES, we couldn't speak to them or make any contact until the Waiver was approved by the Director of the Div. of Purchase & Property -- the State's chief contracting officer, responsible for billions of dollars spent every year, including municipalities.

The Waiver will get its own blog, because the State Treasurer him or herself (or deputy), has to sign that. During my 39 year tenure we had one female state treasurer, Feather O'Connor, and she was pretty good (to us). The vast majority of managers, directors and higher up in NJ government are men it appears to me -- what a shame.

The RFQ, if you haven't guessed, is Request for Quotation -- This is a bigger deal -- you're asking for the vendor's prices, as opposed to just information and NO formal prices, on a specific item which you have defined. I did this with DPA bids (under $27,000 per purchase), all the time -- well once in a while, but it was easy. Depending on the price of the item (not cost which is very different), I would call three or more vendors for a quote and record their verbal responses, or request their response by sealed bid via a deadline and the mail (or hand delivered.) All fun stuff. 

That's how I hired Gabel Associates of Highland Park to be our energy consultants for buying electricity and natural gas for all state agencies -- 826 MWH and 25 million therms worth, or $100 million annually. Bob Chilton was the very best to work with during those contract years, and also Brian their database guru. All above board, documented and approved per State Circular Letter 23I for Delegated Purchase Authority (DPA).

DPA simply means the agency, in my case the Div. of Administration (and there's hundreds of divisions), was authorized to buy things direct from vendors -- as long as we followed protocol -- the regs. If an agency did a poor job, DPA authority could be taken away from them. No matter how poorly done (and I knew), no one's authority was ever taken away except for the University of Medicine and Dentistry shakeup.

However, the first Gabel DPA couldn't suffice long term, and it's against regs to split DPAs or exceed limits in a year, so it had to be bid.

So I wrote the RFP for a 3-year contract, no $ limits.

Now the piece de' resistance, the RFP -- Request for Proposal(s). This is the most formal procurement document used by government. Very formal with convoluted and extensive terms and conditions that have to met at a big cost to the bidder. We issued RFPs and companies bid to win the contract. I and others had worked on one, for statewide computer and PC maintenance and software, with five categories -- in which we awarded four separate vendors, and cancelled one category bid as too high, Honeywell Bull. So RFPs can be very complex. Usually none is less than twenty pages, usually much more.

The last big RFP I wrote, was for an Energy Tracking System, a means whereby a successful bidder would receive ALL state utility bills directly, verify them, analyze them (from thousands of electric and gas accounts across the state), every month, and submit to us a concise monthly bill and energy use statistics by using agency.  Our Office of Energy Savings (Treasury Department) had 10 days to pay the consolidated bills, i.e. 10 days. That system and contract is still in place today, five years later. (That will be another blog also.) In that contract, awarded to Energy Solve, a NJ firm, they received up to $6 per invoice processed. We thought that was a reasonable fee for what we wanted and what they offered in meeting our RFP requirements.

That RFP was 60 pages long. So you get the idea. I've seen RFPs over 100 pages long. One over 200 pages, for IFAS, the OIT's proposed new financial, purchasing and asset control system. That was over 4100 million when we didn't have cash, so that went no where.That's why today's NJCFS system is so outdated and takes manual manipulation at times. By prior boss, chris reid had been the project mamnager who created the state's first statewide financial system, AAS in the early 80s. These systems lasted a decade or more with lots of customization along the way.

The state was never "bleeding edge" when it came to IT, even tho we're closer now than ever.

The idea here, whether RFI, RFQ or RFP, is 1) do your homework on the product you want first, and Google makes that easy, 2) Obtain and read carefully the product specifications -- if the specs aren't complete or too sparse, I go to another product or vendor. (Remember; what it doesn't say, you don't get), and 3) Always get a solid written price quote. If its a big purchase, say over $2,500 come up with a list of sellers and send them a list of what features you want, tell them this is going to other bidders and ask them to respond in writing.

You will be amazed at the detailed info they send you and the promises they make, in writing! And you'll get deeper discounts to boot, guaranteed.

By Rodney Richards, NJ