What is a transportation RFP?
A request for proposal, often abbreviated as RFP, is a document used to solicit bids from potential transportation companies for upcoming lanes or projects. Some also call this process an RFQ or request for quote.
The document outlines the lanes, the loads' requirements, and the project's scale and scope. You’ll also provide a timeline or schedule for the provider to adhere to. RFPs are usually sent to multiple carriers or providers to win over the best bid for your project or lane.
When to use one
Complex projects with detailed specifications often use RFPs to make sure the carrier meets expectations, but there are other reasons to use RFPs.
These include:
- When your organization does not have internal transportation expertise to rely on
- When getting the best competitive price is crucial
- When regulatory requirements are strict, and you need capable providers
- When a project requires customized solutions
The ultimate goal of an RFP is to choose shipping partners that help improve supply chain efficiency, reduce costs, and ensure reliable transportation of your goods.
RFP process checklist
Follow this guide on issuing an RFP and gain the benefits of the process:
1. Outline goals and objectives
It's critical to start by going over your goals. Evaluate what would make the project or season a success and what is needed to get the job done. This will ensure you’re evaluating prices from carriers that are equipped to provide the required level of service.
2. Draw up any criteria needed to execute your project
Base your criteria on the objectives in step 1. Do you need special equipment like a liftgate? Are special permits required? What is the timeline? These answers should all be a part of the conditions for winning the RFP and help to safeguard your shipments from mishaps.
3. Identify potential providers
Research providers you’ve worked with or would like to work with going forward. Consider factors such as reputation, experience, previous projects and financial stability. Choosing a pool of providers to bid on your RFPs can provide the best chance of finding what you’re looking for.
Suggested Read: What to Look for In an FTL Provider
4. Draft the RFP document
You’ll want to state the objectives clearly and include the requirements you came up with in the previous step. The document will also have a detailed list of commodity, weight, dimensions, and origin and destination zip codes. Be sure to specify submission requirements and mandatory qualifications in order to keep the process organized.
5. Time to Publish
Determine the appropriate channel to distribute your RFP. This can include your company website, emailing it out directly to providers, or using an industry network or procurement portal. Remember to communicate the deadline for submissions clearly to receive on-time responses.
Understanding dates and deadlines
Deadlines are crucial to any transportation solution, and request for proposal dates are no exception. To better understand what dates need to go into an RFP, below are key date terms that are used:
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Bid opening date. This is the date on which you start accepting submissions.
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Deadline for rate submission. Date that providers submit their rates by.
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Feedback deadline. Only applicable in a multi-round RFP; a feedback deadline is made to let providers know how their rates and abilities compare to others and allow for more competition and negotiation.
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Selection date. Deadline of when your business chooses a provider to work with.
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Contract start date. The date your provider will start covering loads.
RFPs can be complicated. ArcBest can help
Although RFPs are often necessary for getting the best rates, the complexity and time requirements of the request for proposal process can be a strain on resources. But there is another way to get the benefits you’re looking for: managed transportation.
A managed provider offers a hands-off process and allows for all the benefits of an RFP, like annual, quarterly, or monthly rate adjustments. This can be of extreme value as you wouldn’t have to invest in new technology and keep up with market trends.
Are you sending out bids annually and want to expand your RFP process to send out bids more frequently? This is when managed can come in and assist with the RFP process to make sure you don’t overpay in the marketplace.
Let ArcBest simplify your RFP process
Many companies who choose to use requests for proposal in their business do so out of necessity. Getting the best rate and provider for a project is an important decision, but you don’t have to go at it alone. ArcBest provides a managed transportation service that takes care of all aspects of your transportation. Trust ArcBest to take the lead in your next RFP bid.
