The primary difference between a Request for Proposal (RFP) and a Request for Bid (RFB) lies in the selection criteria: an RFB focuses primarily on price, while an RFP considers factors beyond just cost, such as experience, technical approach, and proposed solutions.
Here's a more detailed breakdown:
RFB (Request for Bid)
- Focus: Price is the dominant factor. The RFB is used when the requirements are clearly defined, and the lowest qualified bidder typically wins the contract.
- Requirements: Highly specific and detailed. There's little room for variation in the proposed solution. The buyer knows exactly what they want.
- Selection Criteria: Primarily based on price and adherence to specifications.
- Examples: Purchasing standard office supplies, repaving a parking lot with specific materials, or replacing a specific model of computer.
- Also Known As: Invitation for Bid (IFB)
RFP (Request for Proposal)
- Focus: A combination of price, qualifications, technical expertise, and proposed solution. Used when the buyer needs innovative solutions, has complex requirements, or is open to different approaches.
- Requirements: More general. The RFP describes the problem the buyer needs to solve but allows vendors to propose different solutions.
- Selection Criteria: A weighted evaluation that considers various factors, including price, technical approach, experience, and management capabilities.
- Examples: Developing a new software system, creating a marketing campaign, or providing consulting services.
- Flexibility: The RFP allows for more negotiation and collaboration between the buyer and the potential vendors.
- Potential for Innovation: An RFP encourages vendors to propose creative and customized solutions.
Summary Table
| Feature | RFB (Request for Bid) | RFP (Request for Proposal) |
|---|---|---|
| Main Driver | Price | Value (Price + Other Factors) |
| Requirements | Highly Specific | More General |
| Solution | Predefined; Little Room for Variation | Open to Different Approaches |
| Selection | Lowest Qualified Bidder | Weighted Evaluation of Multiple Factors |
| Flexibility | Low | High |
| Collaboration | Limited | Potential for Extensive |
| Focus | Commodity Purchases | Complex Projects & Services |
In essence, use an RFB when you know precisely what you want and the lowest price is the most important factor. Use an RFP when you need a solution to a problem, are open to different approaches, and are willing to consider factors beyond just the price.
