Request for Quotation (RFQ)
A request for quotation (RFQ) is a formal document sent to suppliers to request a price for a defined quantity of goods or services. It ensures responses are comparable by specifying the exact requirement upfront.
A request for quotation (RFQ) is a formal document a business sends to one or more suppliers requesting a price for a defined quantity of goods or services. Unlike an informal price check, an RFQ specifies exactly what is needed - product specifications, quantities, required delivery dates, and any supplier terms. This precision means responses arrive on a comparable basis, making it possible to evaluate suppliers against the same criteria rather than comparing prices for slightly different things.
When to Use an RFQ
An RFQ is the right tool when the requirement is fully defined. If you know the exact specification, quantity, and delivery date, an RFQ produces a like-for-like comparison across multiple suppliers. It works well for repeat purchases where the specification is established from a previous order, and for project purchases where the bill of materials or schedule of equipment is already fixed.
Where the requirement is less certain - for example, early-stage project planning where scope is not yet confirmed - an RFP (request for proposal) or informal inquiry is more appropriate. An RFQ commits the supplier to pricing a specific requirement; if that requirement is not yet defined, the prices you receive will not be comparable.
Send to at least three suppliers
Even for suppliers you work with regularly, sending an RFQ to three or more gives you market-rate visibility and prevents a single supplier's pricing from drifting above market over time. It also creates a documented record that protects you if procurement decisions are ever questioned.
RFQ vs. Purchase Order: Two Steps in the Same Process
An RFQ and a purchase order are consecutive steps, not alternatives. The RFQ goes to suppliers before a buying decision is made; the PO goes to the chosen supplier after the decision is confirmed. The RFQ collects prices, lead times, and availability; the PO converts the selected quote into a binding order with agreed terms.
Keeping the two steps separate creates a clean audit trail - you can show what prices were available, why a particular supplier was selected, and what terms were agreed. For significant project purchases, this separation protects the business from price disputes and delivery shortfalls.
Zigaflow's RFQ feature lets you send price requests to multiple suppliers directly from a job or works order. Responses can be compared side by side, and the winning quote converts to a PO in a single step, keeping the full procurement trail visible in one place.
Frequently asked questions
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