Key takeaways:
This guide explains what an RFQ is and how home service providers can use them to stand out and win larger jobs.
- Understand RFQs and their importance. A Request for Quote (RFQ) is a formal document used by commercial and government clients to get detailed pricing and service information from multiple vendors, usually for big projects or long-term contracts.
- Know what to include in an RFQ. If you’re sending an RFQ, essential elements include the scope of work, project specifications, deadlines, required documentation, pricing, and terms and conditions. RFQs must also adhere to submission and requirement guidelines.
- Follow the right process for responding. If you’re receiving an RFQ, read it carefully, confirm your eligibility, accurately estimate costs, draft a detailed and professional quote, and review everything before sending it by the deadline.
- The difference between RFQ, RFI, and RFP. RFQs focus on job pricing and specifics, RFIs are a request for general information, and RFPs ask for detailed proposals and solutions. Each serve a different stage in the client decision-making process.
- Use best practices to boost your chances of success. Don’t be afraid to say no to unfit RFQs, read the RFQ carefully, highlight your qualifications, always submit on time, and use quoting software like Jobber to create polished and organized quotes that help you stand out.
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Small or one-off customers probably reach out to you for quotes on a regular basis. But what about commercial clients with bigger projects, or longer-term contracts?
These clients typically send requests for quotes (RFQs) to multiple businesses at a time to compare services and pricing before making a decision.
To stand out against the competition, you need to convince them to choose your business by providing a professional quote that includes the right elements.
Learn what an RFQ is and how to use them to create quotes that win more work in this guide.
What is an RFQ?
A request for quote (RFQ) is commonly used by commercial or government clients to collect estimates from service providers for large-scale or long-term jobs. They’re often used as part of the bidding process in industries like construction and general contracting projects.
They’re also useful for comparing quotes from different suppliers before choosing where to buy the materials you need to run your service business.
RFQs typically include more information than basic service requests and cover the scope of work, project details, terms and conditions, and any licensing or insurance requirements.
For example, a commercial landscaping business might receive an RFQ from a property management company looking for seasonal lawn care for multiple apartment complexes.
The RFQ would ask for pricing, service, and scheduling details in a single document so they could compare service providers and choose the highest quality provider within their budget.
On the other hand, if you’re a general contractor planning a major renovation, you might send RFQs to plumbers, electricians, or HVAC companies to help determine which subcontractors to bring on board.
What to include in an RFQ
Because RFQs are meant to outline larger, more complex projects, they are more in-depth than standard quote requests. Depending on the job and client, RFQs often include:
1. Scope of work
RFQs define the project scope in detail, like what the job is, where it’s located, and a list of required services.
For example, a commercial cleaning company might receive an RFQ from an office manager requesting nightly janitorial services across three floors. The scope would outline:
- Which areas would need to be cleaned, like offices, bathrooms, and common areas
- The required tasks, like emptying trash, dusting, and vacuuming
- How often the work needs to be done, like daily upkeep alongside monthly carpet cleaning
2. Project specifications
To help ensure the quote provided is accurate, RFQs often provide specifications like square footage, measurements, and any required materials.
For example, mowing a large green space like a park or golf course is very different from maintaining seasonal outdoor planters for a condo building downtown.
They can also list specific requirements, like the type of flooring to use or potential suppliers or vendors to source materials from.
3. Deadlines
RFQs also address deadlines and delivery timelines for both one-off and ongoing projects.
Depending on the job, they might specify a firm completion date or a proposed schedule with project milestones for long-term work.
Like a hard deadline for an HVAC installation in a new building, stages for phased jobs like demolitions, or dates for office cleaning, such as every Tuesday and Thursday.
4. Required documentation
Commercial and government clients may require contractors to have specific licences, permits, or other documentation for a job. RFQs outline which, if any, you need to have or obtain to be considered for the work.
For example, this could include a business license, proof of insurance, safety certifications, or any other specialized permits required for the job, materials, or location.
5. Pricing structure
Most RFQs include information about the pricing structure, like whether the client will pay a flat rate, in installments, or hourly. They may also cover when payments will be provided, like biweekly, monthly, or once specific project milestones are reached.
6. Terms and conditions
An RFQ document may also define any terms and conditions the contractor must be aware of, such as:
- Payment terms
- A rescheduling or cancellation policy
- Warranty or guarantee requirements
- Environmental and safety compliance
- Confidentiality or nondisclosure agreements
- Penalties or fees for missed deadlines
- Liability obligations
7. Submission guidelines
When a client sends an RFQ to a potential supplier or service provider, it includes instructions about who to send it to and when it needs to be submitted by.
For example, you may only have a week to respond to an RFQ, and you may need to send your quote to multiple people.
If you get an RFQ, pay close attention to the submission guidelines and requirements so you don’t accidentally send your quote to the wrong contact or miss the deadline.
How to write a quote for an RFQ
Because quotes for RFQs are what help you to win higher value jobs, they need to include more than just general information. To write a quote for a client who sends an RFQ, be sure to:
1. Read the RFQ carefully
And while you’re at it, make a list of the information you need, such as:
- Service requirements
- Necessary licenses or permits
- Deadlines
- Materials
- Capacity
That way, you know which items to include in your quote.
2. Confirm your eligibility
Receiving an RFQ doesn’t mean you’re the right service provider for the job. Potential clients send out RFQs to multiple suppliers at once, but not all of the businesses they reach out to will qualify for the work.
Before you start writing a quote, confirm your eligibility for the project based on your services, schedule, experience, pricing, and any other requirements. If you meet them, you can move forward and create a quote to send in response.
But if you don’t, you can politely decline the request and focus on jobs that are a better fit.
3. Estimate your costs
Most RFQs will ask for a budget or estimate and provide you with a desired pricing structure.
Based on the scope of work, do your best to figure out your total costs, including:
From there, determine a price based on the RFQ requirements, like a lump sum or itemized prices.
Pro Tip: If you’ve done similar work before, use job costing software like Jobber to determine whether you should adjust your profit margin.
READ MORE: What is job costing?
4. Draft your quote
When you have all the information you need, it’s time to draft a quote. While you can do this manually using Microsoft Word or Google Docs, it’s best to use a free proposal template or quoting software like Jobber.
Making quotes by hand leaves room for human error and won’t look as polished as using a professional template. When dealing with commercial or government clients, a good impression can make all the difference.
To draft a quote for an RFQ, include sections for:
- Your logo, business name, and contact details
- Customer information, like name, service address, and email or phone number
- A quote number and date
- A project summary, including a list of services
- Your proposed pricing, including any required deposits
- A project delivery timeline and completion date
- An outline of any deliverables or milestones
- Any terms or warranty details
With Jobber’s advanced quoting software, you can impress potential clients by adding images, reviews, or other attachments like a proposed schedule—making it easy for them to choose your business over the competition.
5. Review and send
To provide the most accurate quote, review it carefully to ensure you’ve covered all the requirements by:
- Comparing it to the RFQ
- Fixing any typos or spelling errors
- Double-checking pricing
- Attaching any additional documents
- Re-reading the submission instructions
Once you’re sure it’s ready, send it to your contact as directed by the deadline.
What is the process for an RFQ?
The RFQ process depends on whether you’re the one sending or receiving it.
If you’re sending an RFQ to a potential vendor or supplier, the process is as follows:
- Define your requirements, including scope, specs, services, and timeline
- Create a detailed RFQ specific to the project
- Determine a deadline to receive quotes by
- Make a list of potential vendors and send it to them
- Review and compare the vendor responses
- Choose the best fit for the job
As a service provider, you may send an RFQ to a material supplier or other contractors to assist with large or specialized jobs.
If you’re receiving an RFQ, the process looks like this:
- A potential client sends an RFQ to your small business
- Review it carefully to determine fit and eligibility
- Price out the job based on the services, materials, and labor required
- Use quoting software to build a professional quote
- Submit the quote by the deadline and follow up if needed
READ MORE: Quote follow-up email templates
What’s the difference between an RFQ and an RFI?
Unlike an RFQ, which is a request for specific details that directly relate to a job, an RFI is a request for information.
For example, a potential client might use an RFI to:
- Learn about the services you provide
- Describe a problem and ask for potential solutions
- Determine what kind of contractor they need
While RFIs aren’t very common in service industries, they’re sometimes used in commercial construction or by government clients.
When RFIs are used, they are sent before RFPs (request for proposal), with RFQs coming last.
What’s the difference between an RFQ and an RFP?
A request for proposal (RFP) is when a client needs more than just pricing and timeline details.
Instead, they need a comprehensive proposal that includes:
- Multiple solutions or approaches for the project
- A strategy for how you would tackle the job
- Your recommendations for how best to complete the work
- A detailed timeline with specific deliverables
- Examples of similar past projects with photos
- Customer testimonials or references
- Details about your experience and qualifications
Where an RFQ focuses on pricing, an RFP is an opportunity for you to showcase your expertise to help a client understand why you’re the best fit for the job.
An RFP is the second step in the buying process, after an RFI. If a client chooses to move forward with your RFP, they may send an RFQ to invite you to provide a formal quote.
Best practices for responding to RFQs
If you want to win bigger jobs for commercial or government clients, RFQs will likely be an important part of your strategy.
To boost your chances of success, keep these best practices in mind when creating quotes for RFQs.
1. Don’t be afraid to say no
Not all RFQs will be the right fit for your profit margin, schedule, or services. If you get an RFQ for a job you know you can do, great. But don’t be afraid to say no when an RFQ comes in for something that you don’t offer or that will be a stretch.
You can still make a good impression by being honest about what you do and providing a referral to another contractor who’s a better match.
2. Read the RFQ carefully
Make sure you understand the RFQ before you write a quote, including project scope, timeline, and any requirements like licenses or permits. You don’t want to waste time making a custom quote only to realize halfway through that you aren’t eligible for the job.
Even if you are eligible, reviewing the RFQ helps you to create a quote that includes all the relevant information.
For example, some have specific requirements like using certain equipment or following strict safety protocols.
3. Highlight your qualifications
Why should the client pick you? Have you done this kind of work before? Are you offering a great price, or do you have specialized experience or licenses that make you the top choice?
Make it easy for the client to say yes by including customer reviews, photos of past work, and documentation that supports your expertise.
4. Submit on time
No matter how great your quote is, it won’t matter if you miss the deadline. Pay attention to the due date and have your quote ready to send beforehand.
5. Use quoting software
The best way to make a good impression when responding to an RFQ is by sending a detailed, professional quote. It should be organized and easy to read while addressing all the requirements in the RFQ.
With quoting software like Jobber, you can make quotes that stand out, helping you to win big clients and high-value jobs.