It’s not uncommon for people to view requests for proposals, or RFPs in construction, as fishing expeditions. For instance, an owner or government agency may want solutions to a problem with no intention of ever awarding a contract. However, that’s uncommon compared to the biggest issue with requests for proposals: failing to provide the right information to potential bidders.
Whether you’re an owner or someone in a government agency who creates RFPs in construction, here are ideas for getting the best return on your efforts. If you’re a contractor responding to RFPs, these may improve your chances of winning the bids.
What Are Construction RFPs?
Owners and government agencies use construction RFPs to get a pool of interested contractors to bid on a specific project or provide a solution for a specific need.
Most RFPs provide a “scope of work” that outlines the project goals and minimum requirements. Contractors respond with bids detailing how they would approach the project or problem and what their solution will cost.
To confuse things a little, RFQ can also refer to a request for quotation.
You’ll find two other acronyms used with RFP: RFQ and RFI. The RFQ, or request for qualifications, usually happens before the RFP. This is how the owner or agency finds contractors qualified to submit bids on the RFP. To confuse things a little, RFQ can also refer to a request for quotation. Here, the owner or agency knows exactly what they want but require detail about the cost.
Owners and government agencies use the RFI, or request for information, when they need solutions to problems they don’t know how to solve. They also use RFIs when they have a project in mind but need contractor skills to figure out the best way to proceed. They are hoping the responses contractors send to them will provide a solution.
RFIs also come into play when contractors have questions about the RFP.
Construction RFP Examples
The most common RFP is one where a government agency wants to fund an infrastructure project. Water, wastewater, housing, transportation, and recreation are typical, but they can apply to any type of project. Government agencies will also resort to the RFP when they have a project need and want ideas on how to fulfill it best.
On the private side, you will find real estate investors using RFPs when they must renovate foreclosed properties, or when they have unique commercial projects requiring specialized materials or methods.
How Can One Improve the RFP Bid Process in Construction?
If you want people to provide highly relevant responses to your RFP, you must first lay out your expectations and create a document that outlines the scope. You’ll find an important difference here if you are looking for solutions instead of trying to fund a project that’s already designed.
For projects already designed, you’ll provide “details” of the scope, while projects seeking solutions will provide an “outline” of the project’s goals. You don’t want to limit your responses. You’re looking for creative solutions, so by keeping the details at a high level, you don’t lock responders into a particular approach.
Because you want to be able to easily compare responses, you need to assign a specific proposal format. Providing a template for responders can help.
Make sure you include all required components or materials. If you leave out a feature, or one of your “must-haves,” your responses will be incomplete.
The last thing you want is a group of rushed bids with wide-open holes waiting to be filled by change orders.
Allow all responders to have enough time to consider their responses. The last thing you want is a group of rushed bids with wide-open holes waiting to be filled by change orders. Always make your deadlines realistic given the scope of work.
Establish a comprehensive communications program so you can respond to questions from bidders quickly and efficiently. To be fair, and to get the most accurate returns, answers to questions from one bidder should be available to all bidders.
How Can Construction Companies Improve Odds on Winning RFP Projects?
When you submit an RFP to a requesting owner or agency, they will rank your firm against other submitters based on criteria the owner or agency deems important. For example, they might rate you based on your company’s experience with similar projects, your employees’ experience with similar projects, your quality of work, and your financial capability. You should make sure you know the criteria the requester is focusing on to provide the most relevant information.
Any RFP process includes an RFI process for the responders. Use that process to get answers to your questions so you are submitting the most accurate bid you can. But, use it wisely—do not give away portions of your plan or approach or price. Remember, other bidders will see your questions and the responses from the RFP issuer.
Avoid annoying the RFP issuer by asking questions they have already answered in the RFP. Read and reread the RFP; sometimes, information related to one aspect is not necessarily all in one place.
Be specific and clear about the scope you are planning to fulfill. Unnecessary vagueness just makes it harder for the RFP issuer to compare your proposal to the others. It can even lead to the issuer discounting your proposal.
Make sure your partners also understand the scope of their work and are submitting relevant specifics.
You need the overall bid to be highly accurate.
Make sure your partners also understand the scope of their work and are submitting relevant specifics. You need the overall bid to be highly accurate. Accurate bids reflect favorably on your firm and can help when you place future bids with the same owner or agency.
Everyone likes value, especially those issuing RFPs. Consider how you can deliver more value for the same money, and include those details in your proposal.
Construction RFPs: Conclusion
Responding to RFPs is a prime way to win more business and to build long-term business relationships. The best news, though, is that RFP projects often result in fewer headaches because people have done adequate planning before a shovel hits the ground.