What Is an RFQ?
A Request for Quotation (RFQ) is a formal procurement document issued by a buyer to pre-qualified suppliers, requesting pricing, delivery, and commercial terms for well-defined materials or equipment. RFQs are the standard method for purchasing piping materials, structural steel, valves, and instrumentation in EPC projects.
The RFQ assumes that technical specifications are already finalized. The buyer knows exactly what is needed; the question is which supplier offers the best combination of price, delivery, and quality.
RFQ Contents
| Section | Information Provided |
|---|---|
| Project overview | Project name, end user, location, governing standards |
| Material list | Detailed MTO with specs, sizes, quantities, pipe classes |
| Technical requirements | ASTM/API grades, supplementary testing, NACE compliance, coating |
| Delivery requirements | Required delivery date, shipping destination, Incoterms |
| Commercial terms | Payment conditions, currency, validity period, warranty |
| Documentation | Mill test certificates, inspection reports, shipping documents |
| Submission format | Pricing template, deadline, contact for clarifications |
| Evaluation criteria | Price, delivery, technical compliance, past performance |
The RFQ Process
The procurement cycle from RFQ to purchase order follows a structured sequence:
| Step | Activity | Typical Duration |
|---|---|---|
| 1 | Prepare RFQ package from MTO and pipe class | 3-5 days |
| 2 | Issue RFQ to 3-6 pre-qualified suppliers | 1 day |
| 3 | Suppliers prepare and submit quotations | 7-14 days |
| 4 | Technical evaluation (compliance check) | 3-5 days |
| 5 | Commercial evaluation (bid tabulation) | 2-3 days |
| 6 | Clarification rounds with shortlisted suppliers | 3-7 days |
| 7 | Final negotiation and award recommendation | 2-5 days |
| 8 | Purchase order issuance | 1-2 days |
Total cycle time from RFQ issue to PO: 3-5 weeks for standard materials, 6-10 weeks for critical or engineered items.
Bid Tabulation
Responses are compared in a bid tabulation (bid tab)—a side-by-side matrix that scores each supplier on predefined criteria:
| Evaluation Criterion | Typical Weight |
|---|---|
| Unit price | 30-40% |
| Total delivered cost | 15-20% |
| Delivery time | 15-25% |
| Technical compliance | 15-20% |
| Supplier track record | 5-10% |
| Payment terms | 5-10% |
When to Use an RFQ
RFQs are appropriate when specifications are clear, quantities are defined, and the buyer needs competitive pricing. They are the right tool for commodity piping materials (carbon steel pipes, standard fittings, flanges) and off-the-shelf valves.
For complex requirements—engineered equipment, specialty alloys, or services requiring a technical approach—an RFP (Request for Proposal) is more appropriate. The RFP evaluates methodology and capability alongside price.
RFQs are generated from MTOs that originate from P&IDs and piping isometrics. Accuracy at every upstream stage directly affects the quality of supplier responses.
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