Request for Proposal

Question 1

What are some benefits and pitfalls of Request for Proposals (RFPs)?

Answer 1

Benefit – identifies risks and benefits upfront and brings structure and organization to lengthy process of procurement.

Pitfall – process can be bogged down in unnecessary details, leaving vendors confused on what organization wants. Another pitfall is focusing on pricing as priority.

Question 2

How do you create sustainable value with an RFP?

Answer 2

The RFP can help you find the ‘right’ fleet management company and other suppliers to help you achieve strategic goals and get the best value for your fleet and organization.

Question 3

What are the steps involved in identifying the need for a proposal?

Answer 3

• Involve the stakeholders to define the organization’s needs as clearly as possible.
• Separate needs from wants.

Question 4

Why is it important to involve stakeholders in defining an organization’s needs?

Answer 4

They have more insight on what the issues are within the organization.

Question 5

What are the three methods of procurement used in both the public and private sector?

Answer 5

RFP, RFQ, ITB (invitation to bid).

Question 6

When should each procurement method be used?

Answer 6

RFP – vendor inputs solution.
RFQ – simple specs, small expenditures.
ITB – specific product or service.

Question 7

Who is included in a RFP team?

Answer 7

Fleet manager forms a team that consists of people with necessary expertise, experience and or stake in the purchase.

Question 8

Who usually evaluates proposals?

Answer 8

Evaluation committee – fleet manager, technical expert, finance manager, sourcing professional, legal expert, end user members.

Question 9

What time should be allotted for the RFP process?

Answer 9

14-18 weeks.

Question 10

What are ‘soft costs’?

Answer 10

Costs that are difficult to account. (downtime)

Question 11

What is the myth of administrative fees?

Answer 11

Vendors will promise lower admin fees to give the impression of best value. Admin fees account for only 2-3% of total fleet budget.

Question 12

Where do the most significant fleet cost savings come from?

Answer 12

Depreciation, maintenance and fuel account for 78% of overall cost and offer the greatest opportunities for savings.

Question 13

What are the four major elements that every RFP should include?

Answer 13

• Contractual service terms and conditions.
• Statement of work.
• Proposal submission information.
• Offeror information and representations.

Question 14

Why is it important not to be too broad or general with the RFP language?

Answer 14

Keep it simple and ask for what you want rather than what can they provide. Receive the right quantitative and qualitative information.

Question 15

Why is it important to solicit the RFP to the right companies?

Answer 15

Wrong lists equates to wrong responses.

Question 16

How do lists that are too narrow limit exposure?

Answer 16

Lists that are too narrow limit your exposure to new approaches, better ideas and lower costs from other resources.

Question 17

How do lists that are too broad limit responses?

Answer 17

Lists that are too broad means receiving too much information that may be irrelevant to the RFP.

Question 18

What is a BAFO?

Answer 18

Best and Final Offer. Short list of finalists submit their best and final offer. If variables or unforeseen technicalities or expenses were revealed during evaluation, then vendors may lower price due to these discoveries.

Question 19

What information is included in the Contractual Service Terms and Conditions?

Answer 19

Includes buyer information, coverage details, agreement period, administration, order of precedence, governing law, contractor’s responsibilities, taxes, price adjustment clause, liability and insurance requirements, indemnification clauses, cancellation clause, modification of contract, ethics clauses, and other tailored clauses.

Question 20

The term ‘Statement of Work’ is often associated with what?

Answer 20

Defines the problem and states the scope, standards and specifics of the desired solution.

Question 21

What does a ‘specification’ usually define?

Answer 21

What’s needed and expected in order for a proposal to be considered responsive. Define a commodity.

Question 22

What are some of the common specification types?

Answer 22

• Commercial standards.
• Design specifications.
• Brand name.
• Performance specifications.

Question 23

What is included in the ‘Proposal Submission Information’ section?

Answer 23

Preproposal meeting/question schedule, evaluation criteria, pricing page.

Question 24

What’s included on the ‘Offeror Information and Representations’ section?

Answer 24

Detailed pricing information, breakdown of leasing process, fees and charges, implementation and service.

Question 25

Why is it important that all offerors provide the data in the same format and sequence?

Answer 25

More efficient to organize and compare data.

Question 26

What are Bid Evaluation criteria?

Answer 26

Criteria to evaluate and differentiate between proposals. Must be tailored to the specific requirement in order to ensure intended and appropriate end results are achieved to meet the organization’s needs.

Question 27

What is a mandatory minimum system? What is a pitfall of this system?

Answer 27

Pass/fail test to eliminate unqualified proposals as early as possible. Useful if you define minimum requirements very clearly.
Pitfall – you might eliminate offerors that are willing or could meet the requirements if allowed to do so.

Question 28

What is a point system? What is its weakness?

Answer 28

This system recognizes and finds differences among vendor’s strength and capabilities.
Weakness – based on the assumption all criteria is equally important. If one criteria is more important, you might choose a variation known as the weighted scale system.