When we ask property and facility managers about their request for proposal (RFP) process, we get responses like, “What RFP process?” or, “What’s an RFP?” or even, “Ugh!”
RFPs are incredibly important, as they can help find the best vendors for service agreements and projects that can be a significant portion of a property’s budget. As a building owner or property manager, you have a fiduciary responsibility to make sure you are giving the best service to each of the properties you oversee.
Yet many property managers typically flinch at the mention of an RFP. Some people think that RFPs inherently are only looking to find the lowest bidder. Others feel like they can be too exacting by not allowing the vendors the ability to provide their expert insight. And many think that RFPs take way too long to complete.
3 RFP Myths Debunked
Here’s why each of those points are incorrect, and how you can create and manage RFPs much more efficiently.
Myth #1: RFPs are Looking for the Lowest Bidder
Actually, the opposite is true. Not sending out an RFP is the easiest way find the initial low-price bidder, and ignore long-term costs and service levels.
With a well-designed RFP, specific requirements and questions formatted into easy-to-follow sections will help to distinguish between good vendors and those who can’t match up. Good RFPs will spell out the details of what’s needed, making it easy to weed out low-quality companies.
Be sure to include areas for vendors to input their own measurements. If most service providers’ measurements are roughly the same but another’s measurements are significantly off, that may signal an issue with their bid that may end up impacting pricing.
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Sending an email asking for a price won’t allow good vendors to show favorably or poor vendors to be clearly called out – you’ll only see the price. That low price could harm your property in the end.
Myth #2: Vendors Can’t Provide Expertise
This can be true, depending on the quality of the RFP. We’ve seen many RFPs and the ones that struggle are those that are either too hard-lined in the requirements vendors must follow, or the complete opposite, there’s no set conditions and everything is open ended.
Find the right balance. Determine what is a must, and what can be an opportunity to learn from the vendors themselves.
Good RFPs will spell out the details of what’s needed, making it easy to weed out low-quality companies.
While this is a big project for you now, vendors do this every day and their level tof expertise shouldn’t be dismissed. Have plenty of strict guidelines, but where appropriate be sure to let them state what they think would be best for your project.
Myth #3: RFPs Take too Much Time to Complete and Manage
This is the most common reason for not wanting to do a formal RFP. Many property managers are so busy they can’t see straight so they don’t like the idea of spending time to construct a document like an RFP.
Save Time on Your RFP Process
Here are four tips on how you can save time and still create an effective RFP:
1. Create templates.
This will take some up-front work, but the long-term advantages are worth it. Create scope of work templates for your most popular projects. Talk with vendors to see which questions you should ask, do a web search for “RFP template” with the type of service you are looking for, and set it up so that it can be repeatable.
2. Control the formatting.
It’s difficult to compare vendor proposals when they are all formatted differently, so require that vendors fit your format. For each question or requirement in your RFP, put how you’d like them to respond (open text with a word limit, a simple yes/no, a number, etc.). This way when all the bids are returned, they will be easy to line up side by side.
3. Follow up with providers to ensure they will submit.
The worst-case scenario happens when you spend time creating an RFP, and nobody responds to it. Not getting bids back would be a waste of time. Reach out to providers during the process and remind them to submit their responses, even going so far as to get confirmation from them that they will bid.
4. Build a matrix to compare bids side-by-side.
Once the proposals have come in, put them into a comparison matrix in a program like a spreadsheet so that you can compare them all in an apples-to-apples format. Because you already told them how you’d like them to respond, they should all be relatively similar making this process easy.
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Once you’ve created your matrix, picking the winning bid will be easier, and you’ll know that you’ve found the service provider that best meets your project requirements.
Managers who follow this process save themselves time while providing outstanding service to their properties.
Matt Wolach is the president of Synlio, an online request for proposal automation software solution that helps property and facility managers save time and find the best vendors for their projects and service agreements.
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