Tag Archives: Request for Proposal

Replying to RFPs Is a Waste of Time (Most of the Time)

By Jeff Beals

When I was in high school (circa 1986), I auditioned for a couple of Hollywood movies.  One of the movies was being filmed here in my hometown while the other one held auditions here in addition to several other cities. I tried out just for fun, and knowing the long odds, I never expected to be chosen.  Though I wasn’t offered a part in either film, the experiences were eye opening for a 17-year-old kid.

The first audition was a positive experience. It was a comedy film written for a teenage audience. I tried out for the lead role, which was fittingly enough, a nerdy high school kid who was forced to fight an intimidating bully who had just transferred in from another school. I had an appointed time to show up and spent about 30 minutes with the casting director and his entourage. I read several scenes and then answered interview questions. I felt like I was actually being considered for the part.

The second audition was a “cattle call,” in which several hundred would-be movie stars showed up at a local hotel ballroom. After waiting a couple hours, I was brought into a separate room with a group of six other guys. They lined us up, looked at each of us in comparison to one another and then told half of us to go home. I was one of the guys told to leave.  That was it.  I waited for hours only to be sent packing having never said a word.

Do you want to know why I received so much more attention in the first audition than the second?  I was actually recommended for the first movie by a local talent agency that had been hired by the movie producers.  At the second audition, I was just one of 250 nameless, faceless unknowns.

Why do I tell you this story?

Because it reminds me of the Request-for-Proposal (RFP) process in the world of sales.  As a general rule, I hate RFPs and I only respond to them under rare circumstances.

I hate RFPs, because they are just like that cattle-call movie audition. Think about it this way:

  • A company decides it needs a new vendor, so several employees sit down and think of all the things they do and don’t want and then dream up a bunch of hoops for would-be vendors to jump through.
  • They send the RFP to every potential vendor they can think of.
  • Prospective vendors practically do backflips trying to meet all the RFP requirements and end up rushing to meet the deadline.
  • The company that issued the RFP then examines all the proposals that were submitted and compares them.  Ultimately, they decide that some of the proposals are basically offering the same products/services, so they choose the lowest-priced bid.
  • And it can get even worse.  The finalists are sometimes pitted against each other in a bidding war to see who is willing to discount their price to the lowest number. It’s a race to the bottom.
  • The “winner” ends up doing a lot of work for too little money.

This is not a recipe for high profitability.

Generally speaking, I recommend you respond to RFPs only when your relationship with the client is so strong that you are essentially guaranteed of winning.  Some companies have policies requiring that vendor relationships go out to bid periodically. If this is the case at one of your best client companies, tell them you will help write the RFP.  You can then write the RFP to favor you and the way you do business.

If you don’t write the RFP or at least have heavy influence on the RFP, it very well could be an expensive waste of your time replying to the RFP.  An exception would be when the RFP is a mere formality designed to make shareholders feel better and you are the pre-chosen winner.

Now, I realize that there are some industries where RFPs are a rooted part of the culture. In other words, they’re so common that there’s no getting around them.  That’s not the case in most industries.  When at all possible, avoid RFPs.  Just like the cattle-call audition, you have little chance of winning.  Meanwhile, you spend tons of time and money preparing a proposal and get no revenue in return. If by some miracle, you are chosen, you’re probably going to get skewered on price.

Just say “no” to RFPs!

By the way, that movie for which I was actually considered turned out to be a box-office flop, earning only $1.5 million during its opening weekend. But it did play on cable television for many years.  To this day, I’ve never watched the entire show but have seen bits and pieces of it.  I’ll never forget the first time I stumbled upon it. I was flipping through television channels and landed on something that looked mildly interesting.  As I started watching the show, it felt so familiar. Then I realized that I was watching the very scene I read during that audition.  It was fun to think what could have been…