A request for quotation (RFQ) asks one or more suppliers for pricing and terms against a defined requirement. It helps a buyer compare the same item, quantity, specification and delivery need before selecting an offer.
The output is a supplier quotation. Selecting a quote, authorizing a purchase order and receiving the goods are later decisions with their own records.
RFQ versus RFP and purchase order
| Document | Primary job | Typical evaluation |
|---|---|---|
| RFQ | Request an offer for a defined requirement | Price, specification, quantity, delivery and terms |
| RFP | Request an approach to meeting a broader requirement | Proposed solution, delivery approach, capability and commercial terms |
| Purchase order | State the proposed or authorized purchase | Items, quantities, prices, schedule and applicable terms |
These are practical distinctions, not universal legal outcomes. Obligations depend on the documents, acceptance, existing agreements and applicable law. Do not treat the document title alone as proof that no obligation exists or that payment is automatically due.
A small-business RFQ can be a structured email. The useful test is whether the replies can be compared without guessing what each supplier included.
What to ask suppliers
Include the item specification, intended quantity, purchase unit, delivery location, required arrival date and response deadline. Ask the supplier to state:
- Unit price, currency and the quantity tier to which the price applies.
- Pack size, minimum order quantity and any required order multiple.
- Freight and other charges, with tax treatment identified separately.
- Availability and lead time, distinguishing dispatch from arrival.
- Quote validity and conditions that can change price or availability.
- Payment terms and any deposit requirement.
- Proposed alternatives or exclusions, clearly separated from the requested specification.
A volume estimate should be labeled as an estimate unless the business intends to make a commitment. A lower price at an impractical quantity is not automatically a better offer.
Worked comparison: 20 boxes needed within two days
Assume these fictional quotes meet the same glove specification, box size and delivery location. Prices exclude tax, and the buyer requires arrival within two days.
| Supplier | Price per box | Freight | Total for 20 boxes | Quoted arrival |
|---|---|---|---|---|
| A | $8.00 | $20 | $180 | One day |
| B | $9.00 | $8 | $188 | Two days |
| C | $7.50 | $12 | $162 | Five days |
C has the lowest delivered price but misses the stated deadline. A is the lowest-priced qualifying offer under these assumptions. Before selecting it, verify that the quoted stock and date are still available and that no excluded charge changes the comparison.
This is an evaluation example, not a rule to award every RFQ to the lowest price. A specification difference, service requirement or unverified delivery promise may change the decision. The stockroom RFQ workflow shows the handoff from comparable offers to a reviewed purchase order.
When to request another quote
A new supplier, changed specification, expiring quote, capacity problem or material price change can justify a fresh RFQ. Existing pricing and supplier history may be sufficient for another order when the agreement and current availability cover it.
There is no universal rule that five previous orders, six months of prices or a particular fill rate removes the need for market review. A supplier scorecard supplies evidence; it does not decide the purchase automatically. Use the business's policy, the value and consequences of the purchase, and the terms still in force.
If a supplier misses the response deadline, record whether the buyer excludes the offer or approves an extension. Avoid silently comparing one late, revised quote with earlier offers that were evaluated on different terms.
Compare the whole requirement
A shorter quoted lead time may reduce expected demand during replenishment, but the quote is not evidence of reliable performance. Check actual delivery history and uncertainty before changing reorder assumptions.
A large minimum order quantity may create extra stock, handling or waste. EOQ can inform a separate cost analysis under its assumptions; it is not a substitute for the supplier's actual constraints.
Payment terms change the timing of cash requirements. Compare them alongside the total price, deposits and delivery conditions rather than assuming the longest term always wins.
Preserve the award and later changes
Record the selected quote version, comparison basis, approval and resulting PO reference. If the supplier changes a quantity, price or date after selection, retain that change and the buyer's decision. The old quote should not silently become evidence of a new agreement.
In a LineNow RFQ demonstration, bring one specification and two supplier replies with different pack sizes or freight terms. Confirm what is captured, who compares and approves the offers, and how the selected terms reach the PO. Then follow a changed confirmation and partial receipt through the living purchase order.