What is an RFX?
This article explains what an RFX is in procurement, covers the different types of vendor request documents, walks through the typical RFX process from creation to evaluation, and discusses how automation can improve efficiency.
RFX meaning: The umbrella term for procurement requests
RFX stands for "Request for X," where X is a variable representing different types of vendor questionnaires. This term covers various documents used in procurement to gather information from potential vendors. It's helpful when talking about sourcing processes that might need multiple types of requests, or when the specific type of request hasn't been determined yet.
When your company plans to buy new software but hasn't decided whether to start by asking for basic information or detailed proposals, you might just call it an "RFX process" rather than naming a specific document type.
Types of RFX documents
The procurement world uses several specific RFX documents, each with its own purpose in finding the right vendor. Here are the most common ones:
Request for proposal (RFP)
An RFP is a formal questionnaire sent to potential vendors to compare them and pick the best one. This detailed document typically includes background about your organization, what problems you're trying to solve, what work needs to be done, when you need it finished, how you'll evaluate responses, and specific questions about how the vendor would approach your needs.
A hospital looking for a new patient records system might send an RFP asking vendors to explain their setup process, security features, and support options along with basic company information.
RFPs work best for important, high-value purchases where you need to know exactly how vendors would handle your particular situation.
Request for information (RFI)
The RFI is more casual than other RFX documents. It still asks questions, but focuses on getting general information rather than specific proposals.
Companies use RFIs to learn what solutions exist, see what the market offers, plan future purchases, and find potential vendors for later RFPs.
Unlike other RFX documents, an RFI usually doesn't lead directly to picking a vendor. It's mainly a way for the buyer to learn about what's available.
A factory considering automation might send an RFI to understand what options exist before defining exactly what they want to buy.
Request for quotation (RFQ)
The RFQ focuses mainly on price. It asks vendors to detail their costs and payment terms for clearly specified items or services.
When using an RFQ, you should already know exactly what you need. Unlike other RFX documents that let vendors suggest different approaches, the RFQ requires you to clearly spell out what you want, with exact specifications and quantities.
If a company needs to buy 1,000 office chairs with specific features, an RFQ would help compare vendor prices.
Request for qualifications (RFQ)
Though it shares the same abbreviation as Request for Quotation, this document focuses on vendor expertise and experience. Vendors respond with a Statement of Qualifications rather than a proposal.
Construction projects and other big purchases where expertise matters most often use this approach. A city planning a bridge repair might first ask for qualifications to find engineering firms with relevant experience before asking for detailed proposals.
Request for proposal lite (RFP lite)
This is a shorter version of an RFP. While a full RFP might contain dozens of questions, an RFP lite might have just 10 or so.
This streamlined approach works well for routine purchases, lower-risk items, or checking if your current vendor is still offering competitive terms without going through a full RFP process.
Electronic request for proposal (eRFP)
This is simply a digital RFP. As procurement teams embrace technology, many now use online systems that make the process more efficient for both buyers and sellers.
These systems can improve the entire process from creating documents to evaluating proposals, with features like central document storage, automatic scoring, team evaluation tools, and online submission.
Other RFX types
Several other RFX documents exist for specific situations:
- Request for Tender (RFT): Similar to an RFP but more common outside North America.
- Request for Bid (RFB): Usually requires sealed bids that remain unopened until the deadline.
- Request for Offer (RFO): Invites vendors to propose solutions to your stated problem, giving them more freedom to be creative.
- Request for Partner (RFP): Encourages more open collaboration between buyers and sellers, focusing on building relationships rather than one-sided evaluation.
The RFX process: From creation to evaluation
No matter which RFX document you use, the basic process follows a similar pattern:
1. RFX creation
Start by clearly defining what problem you're trying to solve. What does your organization need? Who should be involved in the decision? What are you trying to get? What's your budget? Clear definition at the beginning saves headaches later.
For a new customer relationship management system, you'd get input from sales, marketing, customer service, and IT about what they need and what problems they have with the current system.
Create a timeline with key dates to keep everyone on track. This helps both your team and potential vendors plan appropriately.
Write your questionnaire, thinking about how vendors will interpret it. Include background information, a description of your current situation, a clear statement of the problem, what's in scope, and specific questions designed to get the information you need to make a good decision.
Ask focused questions that will actually help you decide. Instead of "Do you provide training?" ask "Describe your training program, including formats available, customization options, and typical duration."
2. RFX administration
Limit your RFX to three to six vendors that meet your basic requirements to avoid overwhelming your evaluation team. Private companies can send RFX documents directly to selected vendors, while government organizations often need to publish them publicly.
Vendors will almost certainly have questions about what you're asking. Build time for this into your schedule, and be fair by sharing all questions and answers with every vendor.
As your deadline approaches, remind vendors who haven't responded yet. A friendly note about a week before the due date can increase your response rate.
3. RFX evaluation
Once you have the responses, evaluate each one using your predefined criteria. For example, you might weigh technical capability at 40%, price at 30%, and support at 30%.
After scoring each proposal, look at the strengths and weaknesses of all options. Compare responses side by side to see which option best meets your needs.
If you're ready to buy, select a winner and start negotiating the contract. If you're not quite ready, use what you've learned to narrow your options or plan next steps.
For complex purchases, you might start with an RFI to learn about options, move to an RFP to get detailed proposals, and finish with an RFQ to nail down pricing.
RFX project translation
For companies working internationally, language differences can complicate the RFX process. Modern RFX management systems often include translation features to help with this.
If your French office receives an RFP in French, you could translate it to English, work on the response in English, and then translate it back to French before submitting.
This capability makes international procurement smoother by ensuring clear communication across language barriers.
RFX automation: Making things easier
As buying and selling processes get more complex, many organizations now use software to manage their RFX activities more efficiently.
For procurement teams sending out RFX documents, automation helps with creating templates, distributing documents, managing questions and answers, and evaluating responses.
For sales teams responding to RFX documents, automation helps manage content, suggests appropriate answers, coordinates work across teams, and maintains consistent messaging.
Companies using specialized RFP software can respond to about 43% more RFPs than those without such tools, and they can complete each response about 40% faster.
Conclusion
Whether you're buying or selling, understanding the different types of RFX documents and when to use them is key to success.
The term "RFX" is a handy shorthand for the various request documents used in procurement. While these documents are similar in structure and process, each serves a specific purpose. By choosing the right type for your needs and following a structured approach, you can improve your procurement outcomes and vendor relationships.
For complex or frequent RFX management, consider using dedicated software that can streamline the process, improve teamwork, and lead to better purchasing decisions or more successful proposals.
Frequently asked questions
What is an RFx vs RFP?
RFx is an umbrella term standing for "Request for X," covering various types of procurement documents. It's a catch-all phrase for different vendor questionnaires used in procurement processes. RFP (Request for Proposal) is one specific type of RFx document. While an RFP is a formal, standardized questionnaire for comparing vendors and selecting the best option for a specific project, RFx refers to the broader category that includes RFPs along with other document types like RFIs (Request for Information), RFQs (Request for Quotation/Qualifications), and others.
What is RFx management?
RFx management involves overseeing the entire process of creating, distributing, administering, and evaluating procurement request documents. This includes planning the timeline, writing effective questions, selecting appropriate vendors, responding to vendor inquiries, evaluating responses, and ultimately selecting vendors or determining next steps. Modern RFx management often employs automation tools to streamline these processes, helping organizations manage document templates, distribute materials, handle Q&A sessions, and evaluate responses more efficiently.
What is the meaning of RFx in SAP?
In SAP, RFx refers to the procurement request documents managed through SAP's sourcing and procurement modules. Within the SAP ecosystem, RFx functionality enables organizations to create, distribute and manage various types of procurement requests (like RFPs, RFQs, and RFIs) through the platform. SAP's RFx capabilities help streamline the procurement process by digitalizing request documents, automating communications with vendors, and providing tools for evaluating and comparing responses.
What are the five step RFx process?
The RFx process typically follows these five steps:
1. Information Gathering - Defining the problem to solve, identifying stakeholders, determining deliverables, and establishing budget parameters.
2. Process Planning - Developing a timeline with key milestones including publication dates, question periods, response deadlines, and vendor selection targets.
3. RFx Creation - Writing the document with project background, current state description, problem statement, scope, and specific questions.
4. Administration - Selecting and communicating with vendors, publishing the RFx, responding to questions, and sending reminders about deadlines.
5. Evaluation - Scoring proposals using predefined criteria, reviewing results comparatively, and selecting a vendor or determining next steps in the procurement process.