Business document
Request for Quotation (RFQ)
The buyer's request for a price against a defined specification and quantity. Every field on it is an instruction to the estimator, and the ones that are missing cost the most.
Also called: Enquiry · Request for pricing · Invitation to tender · ITT
- Who sends it
- The buyer's purchasing, procurement or estimating function — occasionally an engineer directly, which is usually where the commercial fields go missing.
- Who receives it
- The supplier's sales or estimating function, ideally through a shared inbox or portal rather than an individual's email.
- When it is used
- At the very start of the quote-to-cash chain, once the buyer knows what they need and wants to know what it costs. Also used periodically to re-test the market on parts already in supply.
- Does it bind anyone
- Normally none. An RFQ is an invitation to treat, not an offer — it cannot be accepted into a contract. The supplier's quotation is the offer, and the buyer's purchase order is usually the acceptance. Formal public-sector tenders are a partial exception, where the process itself carries obligations on the buyer.
What it is
An RFQ is a buyer asking one or more suppliers what they would charge to supply something specific. It carries no obligation on either side: the buyer need not order and the supplier need not quote.
Its whole purpose is to make quotations comparable. If four suppliers price the same specification, the same quantity, the same delivery terms and the same schedule, the resulting numbers can be set side by side. Change any one of those variables between suppliers and the comparison is meaningless, which is why a good RFQ is precise about things that feel like detail.
The format ranges from a two-line email to a structured pack running to dozens of pages with drawings, a bill of materials, commercial terms and a required response template. The fields below are the ones that matter regardless of format.
Every field explained — 20 in total
What each field means, a realistic example value, whether you can leave it out, and the thing that goes wrong with it in practice.
| Field | What it means | Example | Needed? |
|---|---|---|---|
| RFQ number / reference | The buyer's unique reference for the enquiry. Every later document should quote it.Watch out Suppliers frequently reply without quoting it, so the buyer cannot match the response to the enquiry. Put it on the quotation, in the email subject, and on the covering page. | RFQ-2026-0418 | Required |
| Issue date and response deadline | When the enquiry was sent and by when quotations must be returned.Watch out The deadline rarely moves when the buyer is slow answering clarifications. Ask in writing for it to be extended by the time taken to answer — most buyers agree if asked, and almost none offer. | Issued 4 March 2026, responses by 18 March 2026, 17:00 | Required |
| Buyer contact and clarification route | Who to ask questions of, and how. On formal tenders, contacting anyone else can disqualify you. | J. Okafor, [email protected], questions by 11 March | Required |
| Part number and description | What is being bought, in the buyer's numbering.Watch out The buyer's part number is not yours. Record both against the enquiry now; you will need the cross-reference on every document from the acknowledgement onwards. | NG-44821 — Mounting bracket, LH | Required |
| Drawing number and revision | The exact engineering definition being priced.Watch out The single most damaging omission on any RFQ. Without a revision, the price is unanchored — the customer's engineering may issue a new revision while the enquiry is in flight and never re-send the pack. Quote the revision back on your quotation so any mismatch surfaces at order entry. | NG-44821, revision C, dated 12 Jan 2026 | Required |
| Specification and standards | Material grade, surface finish, applicable standards, test requirements.Watch out Where the specification names a standard you have not worked to, price the cost of complying with it — including any certification and first-article testing — rather than assuming it is equivalent to what you normally do. | Aluminium 6082-T6, anodised to BS EN ISO 7599, Class 15µm, natural | Required |
| Quantity | How many, and over what period.Watch out '5,000 per year' is not a batch size. Setup spread across 5,000 is a twentieth of setup spread across 250. Always establish the call-off pattern; if it is unknown, respond with a price break table instead of one number. | 400 off, one-time; or 5,000 per annum called off quarterly | Required |
| Price break quantities requested | The quantities the buyer wants separately priced.Watch out If the buyer has not asked for breaks, offer them anyway. It makes your batch-size assumption visible instead of buried, and it frequently sells a larger order. | Price at 100 / 250 / 500 / 1,000 | Optional |
| Required delivery date or lead time | When the goods are needed, or how quickly after order.Watch out Buyer dates often come from an MRP run rather than from a real need. If it is impossible, say so on day one — a supplier who explains the true lead time early is frequently accommodated. | First delivery 14 weeks from order, then monthly | Required |
| Delivery terms (Incoterms) | Who arranges and pays for transport, insurance and customs, and where risk passes.Watch out Omitted far more often than it should be. If it is missing, ask — do not assume ex-works. Freight on a low-value, high-volume part can be several percent of the price. | DAP Northgate Engineering, Sheffield (Incoterms 2020) | Required |
| Delivery address and receiving requirements | Where the goods go, and any booking, labelling or packaging rules at that site.Watch out Receiving rules are often in an appendix nobody reads until the lorry is turned away. They also carry cost — specified pallets, barcode labels and packaging standards belong in the price. | Goods-in Bay 4, delivery slot booked 48h ahead via supplier portal | Conditional |
| Payment terms proposed | When the buyer intends to pay.Watch out End-of-month terms are materially longer than they look — 60 days EOM averages about 75. Price the financing cost rather than absorbing it, and quote an alternative for shorter terms. | 60 days from end of month of invoice | Conditional |
| Tooling requirements and ownership | What tooling is needed, who pays for it, and who owns it afterwards.Watch out Tooling buried inside a part price is never recovered if the volume does not materialise. Quote it as a separate line with its own terms. | Fixture required; buyer to be quoted separately; ownership to pass on payment | Conditional |
| Quality and certification requirements | What must be supplied with the goods and what approvals you must hold.Watch out First-article approval, PPAP submissions and dimensional reports carry real hours. They are a cost line, not a courtesy. | ISO 9001 certified supplier; CoC with each delivery; PPAP Level 3 on first article | Conditional |
| Packaging and labelling specification | How the goods must be presented on arrival. | Max 50 per box, ISPM 15 pallets, label per buyer standard PL-07 | Conditional |
| Validity period requested | How long the buyer wants the quoted price to stand.Watch out A demanded 90-day validity on a material whose price is held for 14 days is a risk transfer. Either shorten the validity, add a price adjustment clause, or price the exposure. | Prices to remain firm for 90 days | Conditional |
| Terms and conditions of purchase | The buyer's standard contractual terms, usually attached or referenced.Watch out Liability caps, liquidated damages, warranty periods and audit rights live here. Reading them at RFQ stage costs an hour; discovering them after a late delivery costs the margin on the contract. | Northgate Conditions of Purchase, rev 7, attached | Conditional |
| Response format required | The template, breakdown or portal submission the buyer requires.Watch out A quotation submitted in the wrong format is sometimes rejected without being read, particularly in formal tenders. Check the submission route before spending the estimating hours. | Complete cost breakdown tab in attached workbook; submit via Jaggaer | Conditional |
| Award criteria | How the buyer will decide, where it is not purely price.Watch out When it is stated, read it before pricing. There is little point discounting to win a decision that is 40% weighted on things you have not addressed. | 60% price, 25% lead time, 15% technical capability | Optional |
| Estimated annual volume and programme life | The size and duration of the opportunity behind this enquiry.Watch out Treat it as context, not commitment. Pricing a spot order on the assumption of a four-year programme, without a contractual volume commitment, is how tooling costs go unrecovered. | 5,000 per annum, 4-year programme | Optional |
A filled-in example
Realistic values throughout — the sort of document that would actually pass through a business.
RFQ-2026-0418 — Northgate Engineering
- RFQ number
- RFQ-2026-0418
- Issued
- 4 March 2026
- Responses by
- 18 March 2026, 17:00
- Buyer
- J. Okafor, Procurement
- Delivery terms
- DAP Sheffield (Incoterms 2020)
- Payment terms
- 60 days from end of month
- Price validity required
- 90 days
| Item | Part number | Description | Drawing / rev | Qty | Required |
|---|---|---|---|---|---|
| 1 | NG-44821 | Mounting bracket, LH — Al 6082-T6, anodised 15µm | NG-44821 rev C | 400 | 14 weeks |
| 2 | NG-44822 | Mounting bracket, RH — Al 6082-T6, anodised 15µm | NG-44822 rev C | 400 | 14 weeks |
| 3 | NG-44830 | Spacer, stainless 316 | NG-44830 rev A | 1,600 | 14 weeks |
- Price breaks requested
- 100 / 250 / 400 / 1,000
- Quality
- CoC with each delivery; supplier to hold ISO 9001
- Attached
- Drawings (3), Conditions of Purchase rev 7, response workbook
What happens next
- 01The supplier logs the enquiry and decides whether to bid.
- 02Any missing or contradictory information is raised as clarifications, ideally in a single batch.
- 03The estimator builds a cost from the specification, quantity and delivery requirement.
- 04A quotation is issued before the deadline, quoting the RFQ number, the drawing revision and the assumptions the price depends on.
- 05The buyer compares quotations, may run a negotiation or best-and-final-offer round, and places a purchase order with the winner.
Where it appears in the chain
- Receiving an RFQA customer asks what something would cost. Before anyone prices it, someone has to decide whether the request is complete, whether it is worth answering, and who is going to answer it.
- Costing the jobWorking out what the job will cost the company to deliver — material, labour, machine time, tooling, outside processes and overhead — before anyone decides what to charge for it.
Common mistakes
MistakeSending an RFQ with no drawing revision
Why it happens: The buyer attaches the current drawing and assumes it is self-evident. Engineering then issues a new revision without re-notifying purchasing.
What to do instead: State the revision in the RFQ text, not only on the drawing, and require suppliers to quote it back on their response.
MistakeAsking for an annual volume but ordering in small batches
Why it happens: The annual figure is what the buyer's system holds. The call-off pattern lives in a different system, or in nobody's.
What to do instead: State both, or ask for price breaks. Suppliers price the batch, and a price given for the wrong batch is not a price either party can rely on.
MistakeLeaving out the delivery terms
Why it happens: Purchasing assumes their standard terms apply and does not repeat them; the supplier assumes ex-works.
What to do instead: Name the Incoterm and the delivery point on every RFQ. It is one line and it is often several percent of the quoted price.
MistakeComparing quotes that priced different things
Why it happens: Three suppliers responded, one quoted delivered and two ex-works, one assumed a batch of 100 and two assumed 400. The cheapest looked cheapest.
What to do instead: Insist on a stated assumption block from every supplier — quantity, revision, delivery terms, lead time, validity — and normalise before comparing.
MistakeIssuing an RFQ with no intention of moving
Why it happens: Purchasing needs three quotes to satisfy an internal rule, and the incumbent is already chosen.
What to do instead: It is a real cost imposed on suppliers, and they learn. If a benchmark is what is wanted, say so — many suppliers will still respond, and honestly.
Terminology
- Invitation to treat
- An invitation to make an offer, rather than an offer itself. An RFQ is normally one, which is why it cannot be 'accepted'.
- Bid pack
- The full set of documents issued with a formal RFQ — drawings, specifications, commercial terms, response templates.
- Clarification period
- The window during which suppliers may ask questions, often with answers circulated to all bidders.
- Award criteria
- The stated basis on which the buyer will choose, where price is not the only factor.
Common questions
›What is the difference between an RFQ and an RFP?
An RFQ prices a specification that is already fixed, so the responses differ mainly on price. An RFP asks suppliers to propose how they would solve a problem, so the responses differ on approach as well. If a buyer issues an RFQ for something not yet fully defined, the quotations will not be comparable, whatever the format says.
›Is an RFQ legally binding?
Generally not. It is an invitation to quote and creates no obligation on either party. The binding sequence usually starts with the supplier's quotation, which is an offer, and completes when the buyer accepts it — often by issuing a purchase order.
›What is the most important field on an RFQ?
The drawing revision, closely followed by the batch quantity. Both are single short strings, both are routinely omitted, and both invalidate the price entirely when they are wrong. Everything else is either recoverable or visible.
›How many suppliers should an RFQ go to?
Enough to be competitive and few enough that each takes it seriously. Sending to a dozen suppliers reliably reduces the quality of the responses, because estimators triage by their chance of winning and a one-in-twelve chance is not worth a careful estimate.
›Should a supplier quote if the RFQ is incomplete?
Only with the gaps stated as explicit assumptions on the quotation. Quoting an incomplete RFQ silently means guessing, and the guess becomes a commitment the moment a purchase order arrives against it.
Tools for this
Downloadable, self-contained, and yours to keep — they run in a browser with no account and no data leaving your machine.
- RFQ Quote ComparisonProCompare supplier quotes line by line on landed cost — unit price, tooling, carriage, minimum order quantity, lead time and payment terms side by side — and find out which quote is actually the cheapest. Nothing is uploaded.
- Tender & Bid RegisterProKeep a register of every tender and bid — value, submission deadline, what it cost to bid and how it ended — with win rates by count and by value calculated from decided bids only. Runs entirely in your browser — nothing is uploaded.
- Lead Tracker & Conversion FunnelProTrack every lead from first contact to won or lost, see which sources actually convert, catch the leads going stale before they die quietly, and print a funnel report. Nothing is uploaded.
Reviewed 2026-08-15. Nothing here is legal, tax or accounting advice — the mandatory content of commercial and tax documents varies by jurisdiction, so confirm the specifics for where you trade.