Responding to RFPs can be a risky proposition. They take a lot of time with no guarantee of getting any freight for your efforts. Yet, RFPs are an important business development channel for a lot of successful carriers. (READ - Get Invited to the Right RFPs: How Small to Medium Sized Carriers Can Strategize). So, if an RFP looks promising and you’re going to take the time to respond, do it right.
Smart carriers know to ignore common assumptions like winning a bid is all about rates, for example. Often, the truth is that the less you make it about rates, the better. Rates matter, of course, but so is giving shippers as many reasons as possible besides rates to want to work with you. There are often two parts to an RFP – the Request for Information (RFI) and your proposal, which includes rates and other service considerations.
RFIs are your chance to set your company apart from the other respondents the shipper is considering. Here, carriers need to be sharp with the information they provide and put the necessary time into the section. Uninspired RFI responses will mean that, at best, your chance of success will come down to rates. More on rates later, but here are a few other quick tips:
As a general rule of thumb - ask questions if you have them. Doing so shows you being thoughtful in your response and is not a sign of weakness. Asking questions also allows you to build more rapport and sometimes even a personal relationship with the shipper. You may get some insight directly that gives you an advantage. Regardless, you should make it a point to develop a personal connection with the company if you do not have one already. It never hurts to have an advocate when responses are evaluated, and decisions are made on who to choose.
Carriers are often also unsure if they should always do exactly what’s asked in the RFP without questioning anything. Not necessarily. RFPs are created and managed by people who can make mistakes and are interested in getting the best result possible. So if something seems off, ask to make sure.
At this point, it’s equally vital that you watch out for signs the customer will not be a good fit. Red flags at any point in the RFP process should not be ignored and could be good indicators the shipper will be the wrong customer. But, once you feel confident you can deliver what the customer needs, you’ve set the stage for presenting your rates.
When the opportunity looks good, it’s time to go all in. And when it comes to rates—don’t hold back. If you’ve never worked with a shipper before, it’s hard to tell how much back-and-forth negotiating they’ll do with rates. So, if you don’t put your best foot forward, you may not get asked back if there’s a second round.
Companies tend to have vastly different philosophies when it comes to how much feedback they’ll provide on rates. Often it depends on your relationship with the shippers whether or not you’ll get a chance to "sharpen your pencil” or not. Unless you’re told otherwise, assuming you'll get that opportunity can be a costly mistake.
It’s a smart approach to go strong in lanes when you think you have a competitive advantage and feel confident you understand your costs. For example, these can be lanes where you have a lot of backhaul freight. Here’s where having a good sense of your company’s strengths is crucial. It gives you the ability to offer competitive rates that are still profitable to you—confidently.
Every carrier has regions, modes, or types of freight it does best. When you find lanes and parts of an RFP that align well with what you do, make sure to take advantage. When responding to an RFP, the goal is to get good freight for your network and not to lose money. So, don’t quote on everything and fall into the trap of competing on price or in lanes you are not confident you can handle profitably. Competing on price is a race to the bottom.
On top of everything else, it helps to communicate that your company cares. Being able to offer solid and relevant references is the best way to show potential customers you’ll be a great partner
Of course, you need to get invited in the first place. RFP processes are increasingly being managed with sourcing technologies by shippers. And the days of Google searching carriers and managing an RFP process through an Excel template are long gone. To keep pace, make sure that you’re part of the Emerge network to be considered for upcoming opportunities that you may not otherwise be aware of.
RFPs are a big commitment of time and expense for carriers and need to offer a positive ROI to be worth your time. Carriers need to qualify shippers, and the RFPs that participate in much the same way shippers vet them. Emerge gives carriers access to RFPs and opportunities for the ‘good’ freight that matches you to the right shippers.