RFI Meaning and Examples: A Guide to Request for Information

Requests for information (RFIs) are used to gather data about a product or service a supplier offers. But what exactly is the proper RFI meaning, and how are these documents used by companies in construction and beyond?

We’ll explain everything you need to know about RFI documentation, including potential use cases, what questions to ask when sending one out, and what to look for in an RFI response.

RFI meaning: What is a request for information?

In supply chain management, an RFI is an official document companies use to get information about a specific product or service. The document is sent to current or potential suppliers.

The RFI is primarily a data-gathering tool, allowing companies to understand what each vendor has to offer. Formalizing the fact-finding portion of the sales process helps buyers organize information and better understand their options. Because RFIs all follow a similar pattern and format, they’re easier to compare than internal paperwork that might look completely different depending on the vendor.

RFI use cases

RFIs are typically used when a buyer is evaluating multiple vendors and needs as much information as possible to inform their final decision. This documentation is particularly prevalent in these industries and purchase situations:

• IT: When buyers are looking to onboard new software, information from multiple vendors makes comparing factors such as setup costs and included support easier.
• Ad agencies: Businesses looking for marketing help might send an RFI to various ad agencies to better understand each agency’s strengths, past successes, service offerings, and campaign capabilities.
• Construction industry: RFIs are used throughout the construction industry. A client may send one to a contractor, contractors use them with subcontractors, and designers use them to get quotes for materials and projects.
• Financial services: Companies in the financial sector sometimes use RFIs to review vendors that offer platforms for tracking transactions or connecting with consumers.
• Healthcare: Hospitals, clinics, private practices, and other healthcare entities may use an RFI to evaluate organizations responsible for the software and systems that help them maintain electronic health records.
• HR: A human resources manager may use an RFI to explore providers’ employee benefits packages, including companies offering retirement savings accounts, health insurance, and disability insurance.
• Retail: Retail companies use RFIs for numerous requests, including evaluating suppliers of items related to store infrastructure (such as UPC scanners and cash registers) and vendors of products intended for resale.

RFI categories and elements

Your preferred inventory management software may come with an RFI. But if you need or want to build your own, be sure to include these components:

Overview

The RFI overview is the supplier’s introduction to your company and goals. Just as you’d introduce yourself before a face-to-face pitch, use the overview to set the scene for your upcoming request.

An overview should include this info about your business:

• Background
• Objectives
• A confidentiality agreement, if needed
• The project or challenge the requested product or service will address
• The time frame for the selection process and overall project

Qualifications

If you have specific requirements vendors must meet to be considered, here is where you should list them. For a service, qualifications may include specific skills or certifications. For a product, you might ask that software meet a certain tech threshold or that the item be a particular size or color.

Information requested

This section is your chance to interview the suppliers. Ask questions that will generate easily comparable answers. For example, you could ask about the supplier’s infrastructure, turnaround time, approach to project management, and QA process. You may even ask how often items are backordered to get an idea of general product availability and inventory flow.

Response expectations

Be specific about when you want the requested information sent back to your team and what format you prefer. Include contact information, such as the party to which the response should be addressed and their preferred email or physical address (especially if it differs from the address used to send the RFI).

You may also want to outline your evaluation criteria so it’s clear what you expect from vendors and how you’re making your final decision.

Clarification

Leave room for suppliers to make suggestions based on their expertise. They could also describe related product lines or services and explain logistical details you didn’t think to ask about.

You can specify the information you don’t want, too. Some companies prefer that prospects stick to the information requested without adding extra data that could complicate the process or make comparison more difficult.

How to write an RFI

The RFI process has three basic steps:

1. The buyer draws up and sends the document. First, you must create the RFI using the RFI template presented above. Include essential elements, such as an overview, project information, and criteria for the requested products or services.
2. The suppliers review the document and respond accordingly. Most buyers are on a finite timeline, but you should leave room for suppliers to gather the necessary information and complete documentation accurately and thoroughly.
3. The buyer will compare responses and create a shortlist for the next stage: the request for proposal (RFP). Once you receive supplier responses, you can evaluate the prospects and decide which to shortlist.

What is an RFI response?

RFI responses are the communications or documentation suppliers send back to buyers based on the initial RFI. Sometimes, these responses are sent via a dedicated platform that facilitates and organizes official communications. Other times, buyers and vendors reply by email or snail mail to send paperwork back and forth, but this method is more difficult to monitor — especially if you’re interested in time-stamping each layer of communication.

RFI best practices

The benefits of using RFI include the ability to make more informed decisions and cast a wider net when interviewing suppliers. But those benefits are only maximized when you adhere to these RFI best practices:

• Clearly define information needs. Vague questions beget vague results. Be specific about the information you need and the format or figures you require to make a final decision.
• Keep the RFI concise and relevant. Only request information directly related to the current challenge or project.
• Ensure equitable response times. Give each prospect plenty of time to gather information and formulate a response. One to two weeks is a typical time frame for RFIs, but more specific RFPs and RFQs in the procure-to-pay process may take longer.
• Stick to the same RFI template within a project. Use the same template for all prospects during a project to make a direct comparison easier.
• Use visuals if they add value or inform responses. Some buyers, such as those in the construction industry, use visuals to help buyers better understand the direction of a project or the scope of a particular ask.

RFI vs. RFP vs. RFQ

While researching requests for information, you’ll likely encounter discussions about the uses of RFP versus RFI or pages dedicated to RFQ meanings. Here’s what each of these acronyms stands for and how they compare:

• RFI: RFI stands for “request for information.” This buyer-originated document asks vendors about a product or service relevant to the buyer’s upcoming project or current challenge.
• RFP: An RFP is a request for a proposal. It’s similar to an RFI in that it requests information on a product or service, but RFPs take it one step further by asking the vendor to outline how their product or service could help the buyer solve a problem or further their project’s goals.
• RFQ: An RFQ is a request for a quotation. RFPs and RFQs are similar, but RFQs delve into the bidding process by requesting a specific quote with detailed information about the offering and its price. The quote is often itemized and provides official notification of what the vendor will charge if the buyer moves forward with a purchase order or bill of exchange.

RFIs, RFPs, and RFQs aren’t interchangeable; they are distinct steps in the order and fulfillment process. You’ll often use all three document types when sourcing a new vendor, though you’ll likely send fewer requests in each successive step. For instance, you might send out 10 RFIs to potential vendors. Only five of those catch your eye and receive an RFP; then, you send two “finalists” an RFQ.

Rethink your supply chain management approach with Orderful

Exchanging RFI information simply and clearly helps your company make better deals, even when timelines and requirements are tight. Electronic data interchange (EDI) assists by providing a structured, standardized format that facilitates information exchange while minimizing errors.

Orderful offers cloud-based EDI that’s up and running in days, not months. To learn more, speak to an Orderful expert today.