RFQ Meaning: Request for Quotation in Purchase

RFQ full form: Request for Quotation. In Indian factories it is usually just called an enquiry. It is the step that turns one vendor's price into a competitive price.

What an RFQ contains

• Enquiry number and date
• Item description, specification or drawing, and item code
• Quantity and unit
• Required delivery date and location
• Terms you want quoted: taxes, freight, payment terms, warranty
• Last date for submitting the quotation

RFQ vs RFP vs RFI

• RFQ: you know exactly what you need, and want a price.
• RFP (request for proposal): you want vendors to suggest a solution, for example a new conveyor system.
• RFI (request for information): you are only finding out who can supply.

For consumables, spares and raw materials, RFQ is the everyday tool.

Where it fits

An approved indent or purchase requisition triggers the RFQ. Vendor replies go onto a comparative statement. The chosen vendor gets a purchase order.

How many vendors to ask

Three is the common minimum for regular items. For high-value or frequently bought items, keep an approved vendor list and ask everyone on it. For single-source items, still ask for a written quotation so the rate is on record and can be compared next time.

Why plants skip it, and what it costs

Sending enquiries by phone or email to three vendors, then chasing replies and typing them into a sheet, takes time. So buyers often skip it and reorder from the last vendor at whatever rate they quote. That is how rates creep up by a few percent each quarter without anyone noticing.

How IndustryPrime handles it

Purchase sends enquiries to multiple vendors in a click, straight from the approved indent. Quotations are collected in one place, compared automatically on a comparative statement, and the chosen vendor becomes the PO. See RFQ software and quotation comparison software.