Request for Quotation (RFQ): what it is and how to use it to select better suppliers

All about request for quotation

An RFQ (Request for Quotation) is a formal document used by companies to invite one or more qualified suppliers to submit a price quotation for the supply of goods or services, based on clearly defined technical, contractual, and delivery requirements.

In procurement processes, the RFQ is a core sourcing tool. It allows buyers to collect comparable quotations and evaluate them mainly on price, terms, and compliance, making it easier to identify the most economically advantageous supplier.

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How the RFQ process works

The process starts with an internal request from a business unit or technical department. If there is no active framework agreement or preferred supplier, procurement launches an RFQ to the market.

The RFQ must clearly define all the elements suppliers need to prepare a quotation, including:

  • technical specifications
  • quantities and volumes
  • delivery timelines
  • commercial and contractual conditions
  • evaluation criteria
  • submission deadline

Procurement invites a set of pre-qualified suppliers to participate. Using an e‑procurement platform significantly speeds up this step, allowing buyers to select suppliers from a vendor database and send the RFQ to multiple vendors simultaneously.

Once quotations are received, procurement compares them against the predefined criteria. At this stage, the focus is mainly on price, but also on compliance with technical and contractual requirements.

Depending on the sourcing strategy and budget objectives, procurement may negotiate improved commercial terms before awarding the RFQ to the supplier offering the best overall value.

After supplier selection, the process is finalized by issuing a Purchase Order (PO) and, where required, formalizing the contractual agreement.

Roles involved in the RFQ process

An RFQ typically involves several stakeholders:

  • Procurement Manager: owns and coordinates the sourcing process

  • Category Manager: manages sourcing within a specific spend category

  • Internal requester: defines functional and technical requirements

  • Supplier Manager (if applicable): supports supplier qualification and selection

  • Legal and Finance: verify contractual compliance and budget alignment

What’s the difference between an RFQ, a Purchase Requisition, and a Direct Purchase Order?

  • Purpose: collect and compare supplier quotations for goods or services
  • When to use it: when sourcing must meet specific requirements and multiple quotations need to be evaluated before selecting a supplier
  • Who manages it: the procurement function or purchasing department, in collaboration with internal requesters

  • Purpose: formally request approval to purchase goods or services
  • When to use it: when a department needs authorization before proceeding with a purchase
  • Who manages it: the requesting department initiates it; procurement reviews and approves it

  • Purpose: purchase goods or services directly from a supplier without issuing an RFQ
  • When to use it: for recurring purchases, catalog items, or when prices and suppliers are already defined
  • Who manages it: the purchasing department or authorized buyers

RFQ vs. Purchase Requisition (PR) vs. Purchase Order (PO): a quick comparison

AcronymMeaningPurposeWhen to use itOutput
RFQRequest for quotationObtain quotations from one or more suppliersWhen it is necessary to compare multiple offersQuotations received and selection of the best supplier
PRPurchase requisitionFormalize an internal purchasing needWhen a department requires a good or servicePurchase approval and issuance of the purchase order
POPurchase orderPurchase directly, without issuing an RFQFor recurring purchases, catalog items, and/or predefined suppliersDirect issuance of the purchase order

The benefits of managing RFQs 100% digitally with the Online Procurement platform

Digitizing RFQs through the Online Procurement platform delivers concrete, strategic advantages for your purchasing team:

  • Standardized process – no more worrying about workflows drifting away from company policies. The platform enforces rules and approvals, eliminating variations and subjective interpretations.

  • Transparency and traceability – every step of the RFQ is documented, with a complete audit trail always available when you need it.

  • Bulk sending and efficient communication – send the RFQ to multiple suppliers at the same time, significantly reducing time and operational complexity.

  • All documentation in the right place – let the system organize quotations and attachments into structured digital folders, making searches faster and easier.

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