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RFPs… So You’re Telling Me There’s a Chance!

(2014年9月26日)

By David Yesford

Lloyd Christmas: “What do you think the chances are [of us] ending up together?”

Mary Swanson: “Not good.”

Lloyd: “You mean not good like one out of a hundred?”

Mary: “I’d say more like one out of a million.”

Lloyd: “So you’re telling me there’s a chance. Yeah!”

Sound familiar? You probably recognize these classic lines from the movie Dumb and Dumber, starring Jim Carrey as Lloyd Christmas, the eternal optimist. I’m not saying all requests for proposals (RFPs) are like this, but it sure does feel like it sometimes. Let me go over a few of my beliefs about RFPs:

  1. Issuing an RFP does not mean the customer is ready to buy. In fact, many RFPs are simply initial market research to see what else is out there and what can be learned from responses. Then, after gathering and digesting the information, a second RFP will be released that addresses the customer’s need.
  2. RFPs are the customer’s attempt to take control of the buying process. There is nothing wrong with that, but it’s something to keep in mind.
  3. RFPs are often influenced by or even written by the competitor. You just happen to be lucky enough to be a comparison bid!

I know plenty of people who simply don’t respond to RFPs and still have success. So why do people feel the need to respond to RFPs? I frequently hear, “So and so won a huge deal from an RFP,” but often find these examples are victories that were one, two, or even three years back.

So you’re telling me there’s a chance!

I suspect one of the reasons many salespeople and companies respond to RFPs is the confusion between activity and outcome. The activity involved with responding to the RFP keeps everyone busy. The “chance” of a win keeps everyone focused and energized.

We might be surprised if we actually did the math.

Over the last year…

  • How many RFPs did you respond to, and how many of your responses made the first cut? (Keep in mind that if you make the first cut, you will now spend even more hours responding.)
  • Did you offer a discount in your RFP response?
  • How many of your proposals won? What is your win rate on RFPs?
  • How much time and money have you spent responding? Is it justified?

I gathered the following research after looking at one company’s RFP responses over a two-year period:

RFP ResponsesFirst CutWon/%Average DiscountAverage Time/Response
42192/4%10%200 hours

These two wins, however, were only worth a total of $800,000 USD. The 8,400 hours (200 hours x 42 responses) spent to win $800K resulted in a combined hourly rate of $48 to prepare the entire proposal. I guarantee the staff who worked on the proposal cost the company more than $48 per hour between salary and overhead, and that doesn’t even account for the cost of goods in actually delivering on the $800K worth of projects. As a result of this research, the company realized responding to RFPs was costing them money. What business can really afford to do that?

How they treated RFPs going forward:

Going forward, this company took a disciplined approach to pursuing RFPs, further defining the criteria that must be met prior to moving forward with an RFP response. With each RFP, they also determined if they could talk to the company soliciting the RFP to truly discover the business need they were trying to resolve. If the RFP process did not allow access to the decision makers and restricted overall contact, the RFP was a clear no-go.

Consider the following when you are faced with making a go/no-go decision on an RFP:

Consider a go decision if…Consider a no-go decision if…
  • The request is clear and there is a defined decision process
  • Timeframes are realistic
  • You have history and/or knowledge that this customer buys in this way
  • Your offering can be profitable
  • You have built credibility with the decision makers before the RFP was issued
  • You have access to stakeholder(s)
  • You discover something is missing in the RFP and have a solution that will help better achieve the customer’s objective
  • The RFP appears it was written to meet many competing interests
  • Timeframes demonstrate a lack of understanding of the work required by the vendor and/or client
  • There is a history of RFPs issued with no subsequent action
  • You need to make significant adjustments to intake, manufacturing, distribution, and/or customer support
  • It appears this is clearly wired for a competitor

After all, we cannot have our salespeople running around like Lloyd Christmas… yeah!

作者介绍
David Yesford David Yesford
David Yesford

David Yesford

David Yesford担任Wilson Learning全球高级副总裁，在制定和实施人力绩效解决方案领域拥有超过27年的经验。他为客户在战略方向和全球化视角方面带来了宝贵的经验。David曾参与销售及领导、在线学习和战略咨询领域的核心内容设计。David目前也是Wilson Learning全球执行委员会的成员。他曾担任中国和印度的总经理职务。他是多本书的特约作者，包括《双赢销售》，《灵活应变销售》，《社交风格手册》和《销售培训图书2》。David是一个活跃的全球演讲者，并在美国、欧洲、拉丁美洲和亚太地区的商业刊物发表了大量的文章。

阅读更多， David Yesford