"Should I respond to that RFQ, RFP, RFI... yes, with an RFM!"

You know the drill... you get an RFQ(request for quotation), RFP(request for proposal) or RFI(request for information) and you're wondering whether or not you should respond? As you ponder, you decide that if you don't comply you'll lose the opportunity to have a shot at the business! You know a lot of these are really nothing more than "price checks" but you're "afraid" that if you don't respond you may seem "dis-interested" and they'll take you off their list. So, you do the work and "hope" that the outcome will be in your favor. Once again you've become the "hunted" rather then the 'hunter".

Through our work with hundreds of companies in a wide variety of businesses, we have learned and identified that much of this "quoting or proposing" ends up being a waste of time and does nothing more than provide leverage for prospects to beat up their current vendor. Or worse, we provide unique ideas or solutions that become a "shopping list" which allows the prospect to take our ideas and share them with the competition. An unfortunate and expensive process we call "cloning" or "free consulting". Expensive because it not only wastes your time but allows them to "commoditize" your offer and drive your margins into the toilet!

We regularly ask our client companies what their experience with these "undeveloped opportunities" has been and the answer is always the same, "low closing percentages"! On average we're told that closing ratios average between 10-20% (often lower), but because they "close some" they feel like they need to respond to all. They have a tough time distinguishing between the ones that are "likely to close" vs. the ones that are "unlikely to close" and because of this see no alternative other than to respond. Most of our clients tell us it is "part of the sales game" and a necessary cost of doing business.

So, the strategy would be to win a higher percentage of our quote, propose requests and stop wasting time and resources on "low percentage" opportunities. The tactic that we have created to implement the strategy is called a "filter". Filters are used to take a large quantity of substance and separate good from bad or high quality from low quality. It all starts with making a decision to "not respond" to RFP's or RFQ's in the way you have been asked (remember, you always have a choice). Responding with information does nothing more than make you look and sound like everyone else and has you losing control of your information asset! Your zeal to respond quickly and demonstrate your capabilities ends up costing you a lot of money!

Let's start by responding to these requests with one of our own... a "filter" if you will. Let's start by responding with an "RFM", or "request for meeting". Rather than just sending what you've been asked for "call to request a meeting". Anyone truly interested in doing business with you should also be willing to spend some time with you. Anyone who will not take the time to meet with you clearly identifies themselves as someone who feels you are not worth their time, which I would suggest means they are not really a good opportunity for you. This simple tool (followed up by other tactics and filters that we will discuss in future posts) will quickly help you "filter" real interest and opportunity from "smoke screen, time waster, column fodder and price check".

Action Step: Stop responding to those RFP's, RFQ's and RFI's with what you have been asked for but instead respond with an "RFM". You'll quickly know where you stand and will save your valuable time and information!

Comments

[David Kutcher]

John, I appreciate your skepticism, I myself have been on the receiving end of many rejections. But I disagree on your conclusion of saying no and RFMing when in many cases meetings are not possible. Please read my article on how to raise your RFP ROI [ http://advice.cio.com/confluentdave/raise_your_rfp_roi ], and visit the RFP Database [ http://www.rfpdb.com ]

[John Hirth]

Dave,

Thanks for your response to my recent post on johnhirth.com.

Suffice it to say in a 600 word post I can only give a small portion of the information, strategy and tactics that we normally provide in our programs regarding this topic. Additionally, like any recommendations on the topic of selling they rarely apply to all businesses and circumstances.

I looked at your article and I'm surprised that you disagreed because I think we are saying about the same thing... sales people need to learn how and what RFP's and RFQ's to respond to. The majority of them spend to much time on poorly qualified projects.

My theory behind "making a call" is only one way of "filtering" who to spend time with. You made some other suggestions in your article that I think could also work and in fact could be combined with or might preface the tactic I provided.

Thanks for your interest in my blog and I hope you will continue to provide food for thought.

John Hirth

[John Hirth]

Dave,

I spent more time reviewing your article and was wondering if it was complete, or was it edited for length? It suggested that sales people need to be more selective of the RFP's they chase (strategy) but gave no specific information on how to create or achieve that selectivity (tactics). "Strategy without tactics is the noise before defeat"...Sun Zu, Art of War.

I also found it interesting that you did not agree with my suggestion that RFP's need to be "filtered" by requesting RFM's, which means not responding as asked (which creates difference). More interesting in light of the fact that you run a website that promotes RFP's and the responses sales people spend valuable time on.

I can understand why you would disagree with my advise given the fact that it might limit the responses (and traffic) to the RFP's your site promotes. Sounds like a clear conflict of interest and so my advise to the people that read this blog would be "take my advise"...

John Hirth