RFI

To avoid the inaccurate material or influence on purchasing decision, request for information (RFI) from suppliers at the beginning and at end of the procurement process is a safe strategy.
RFI can also be used to manage sourcing risks such as business attractions, clear requirements, competitive supplier base, savings opportunities, etc.

RFI is the first phase of the e-RFx application.  It can be implemented as part of strategic e-sourcing during information aggregation and esourcing strategy selection.  It is important to acknowledge that a success e-sourcing process doesn’t need the total involvement of suppliers, but rather an internal and external information aggregation during FRx stage.  If a procurer doesn’t have a clear understanding of their needs, during the purchasing process, the purchaser is allowed to obtain more information (RFI) regarding the product functionality and services from suppliers.

RFI’s objective is to evaluate the potential possibility to cooperate with supplier in a low cost manner.

After identifying the initial set of suppliers, the esourcing team should distribute an RFI that requests materials of the esourcing project, basic information of suppliers and its level of interest in participation. An RFI can generally be defined as a small, succinct high-level exploratory document that is designed to address a specific need and asks simple, direct questions to elucidate that point. An RFI is generally used to determine if a supplier:

• offers a given product or service
• is interested in supplying appropriate products or services to the buyer
• uses or supports a given technology
• is interested in a strategic relationship
• has the ability or capacity to successfully perform to the specifications

Besides basic information, purchasers should also provide materials such as company size, market value, annual income, employment, location, historic and core ability of company. They should accept a confidential agreement that includes their organization, goal and RFx phases they wish to achieve. When purchaser is searching for a new agreement or product and also is interested in supplier’s single  or multiple products, that means the partnership between purchaser and supplier is developed. After the assessment, the qualified supplier will be able to move on to the next stage.

The next phase of RFI helps to identify supplier’s capability, and because of that, an application is built for evaluate suppliers.

When a purchaser is sourcing for new direct/indirect products, RFI should create a channel for communication; that also includes a request for more detailed information for future reference.

An RFI is generally used for market exploration and finding potential suppliers. It can also help buyers to decide which suppliers can conduct business with the them. For example, if a buyer is moving to a new technology and one or more incumbent suppliers are unable to support it, the buyer won’t consider them for future cooperation. In the end, the final goal is to decide which suppliers will be invited to submit a detailed RFP or respond to an RFQ.