What is an RFQ (Request for Quote)?

RFQ stands for request for quote. It’s a document businesses use to ask vendors for pricing on a specific product or service when the requirements are already defined, and the main question is cost.

Unlike a request for proposal (RFP), which invites vendors to suggest solutions, an RFQ assumes you already know what you need. You’re not asking vendors to pitch—you’re asking them to price. That makes it useful for purchases with established specifications, where comparing vendors comes down to consistent commercial terms.

This guide covers how RFQs work, when to use them, what to include, and how to build one.

Key takeaways

• An RFQ, or Request for Quote, asks vendors to provide pricing for clearly defined goods or services.

• RFQs work best when requirements are already established, and price is a major factor in vendor selection.

• A strong RFQ gives every vendor the same information, including specifications, quantities, deadlines, and commercial requirements, so quotes are easier to compare.

When do businesses use an RFQ?

Businesses typically use an RFQ when they already know what they want to buy and need vendors to price the same set of requirements.

In these scenarios, the company doesn't need a consultation or a demo. The request is more transactional. They need the requested information to compare options that align with their internal criteria.

Suppliers willing to bid for the sale or job will then submit their bids against those predefined terms.

What makes a purchase suitable for an RFQ?

RFQs are generally a strong fit in two key scenarios:

• The project details and scope of work have been defined, and the required materials are clearly outlined.

• An existing project or initiative needs to be expanded without changing the technical specification.

In both cases, the work has already been done, either by an internal team or an external consultant separate from the supplier. The company needs the material from a supplier in order to accomplish its goal. No additional support is needed.

Example: A business plans to expand its onsite computer lab as part of a facilities expansion. To do so, the IT department needs 50 laptops with predetermined technical specifications delivered to one location by a certain date.

The requirements are already fixed and won’t change because having identical hardware makes it much easier to manage both the lab and the user experience.

In cases like these, an RFQ is the best buying-process solution.

When should you avoid using an RFQ?

An RFQ isn’t a good fit when the buyer still needs vendors to help define what the final solution should look like.

Usually, that happens when:

• The project requirements are still being actively developed, and the buyer needs vendors to recommend an approach or technical solution.

• A project can be completed in several ways, and factors like methodology, experience, and implementation will matter alongside total cost.

In these scenarios, both the project and execution are still taking shape. Companies can’t request a quote with realistic specificity because they don’t yet know what they’ll need to build their intended solution.

This is a common hurdle when goals aren’t fully tangible.

Example: A company wants to modernize its IT infrastructure but hasn’t fully decided how best to do it. Internal stakeholders are still undecided on systems, physical architecture, and implementation steps.

The requirements aren’t fixed, and different vendors are likely to offer entirely different solutions to meet the company’s needs.

Because stakeholders are uncertain, an RFQ would be a bad fit. Vendors can’t explain their approach in this format, and the company can’t articulate its needs well enough for suppliers to bid accurately.

RFQ vs RFP: What’s the difference?

In most procurement processes, a request for proposal (RFP) is more widely known than an RFQ.

As discussed above, an RFQ allows the buyer to establish the requirements first, then asks suppliers to quote against them. Vendors are generally pricing the same or very similar goods, services, or scope of work, which makes it easier to compare cost, delivery terms, and other commercial factors.

With an RFP, the buyer is asking vendors for more than a price. Suppliers may need to recommend a solution, explain their methodology, define an implementation approach, or demonstrate how they would achieve the desired outcome. As a result, proposals can vary substantially from one vendor to another.

Neither format is inherently better. Both documents can gather information from potential vendors, but they come into play at different stages of the buying process. Often, because an RFP includes a vendor quote, you don't need a separate RFQ.

For a full breakdown of the differences between RFPs and RFQs, check out this article.

What’s included in an RFQ?

An RFQ should give suppliers a complete picture of what they’re being asked to price.

If important details are missing, vendors might make different assumptions about the purchase or try to fill in the gaps with supplemental products or services. With too much variance, the resulting quotes become difficult to compare.

Most RFQs should include the following:

• Product or service requirements. Exactly what the business wants to purchase. This could include hardware model numbers, specific plan details for SaaS services, or similar information.

• Exact-as-possible technical specifications. Any requirements vendors must follow when preparing the quote. Teams should highlight any specs that deviate from product standards (additional RAM, add-on support packages, etc.).

• Desired quantity or contract length. The amount of each item, including seat count for software, and the desired length of any service or support contract.

• Pricing format and scheduling. Instructions for how vendors should break down their costs. If buying SaaS, this might include a month-by-month, per-seat breakdown. Hardware may include the base price, with upgrade costs listed in a separate column.

• Payment terms. Any intended payment terms for the product, such as Net 30, milestone, or payment upon delivery. Buyers may also ask vendors for their standard payment terms.

• Response and delivery deadlines. Covers the deadlines for both the quote submission and product/service delivery.

• Any evaluation criteria. Explains how quotes will be reviewed, particularly if factors beyond price will influence the final decision.

On the other side of the process, vendors will build a quote based on the RFQ details and send it back to the customer for evaluation. They know it’s a competitive process and will provide the requested pricing information.

However, keep in mind that RFQs ask for quotes and don’t offer many opportunities for suppliers to build a complete solution. Expect smaller documents and a more limited scope than what you’ll receive from an RFP.

Should I make exceptions for quote and deliverable deadlines?

Delivery deadlines are critical for the RFQ process, especially when hardware is involved. Vendors need these dates to know if they can supply the requested quantity within the allotted timeframe.

When ordering high volumes, it’s reasonable to expect follow-ups checking for flexibility in certain areas.

Using the example above, if a supplier can furnish 40 laptops by the specified date because of inventory limits but can send the remainder within a week, they may ask whether that arrangement is viable. These questions can be worth answering, especially if the vendor can offer competitive pricing.

Depending on the company’s financial calendar, negotiating deliveries and payment terms may or may not be viable. Check with your organization’s finance team or comptroller to better understand when financial reporting deadlines may conflict with procurement processes.

How to create a professional RFQ

Creating an RFQ is relatively straightforward once you know what information vendors need. The tougher challenge is creating a consistent process that works every time you send a new request.

PandaDoc lets you create a reusable document structure and automated workflow so you can create, send, and track RFQs and other documents from a single platform.

1. Start with a customizable template

Because RFQs are usually part of a specific internal process, they tend to follow the same structure and make the same requests of vendors once established.

Create a template so teams don’t need to rebuild the RFQ each time they initiate the process.

Start by identifying which parts of the document stay consistent from one request to the next and which details change for each purchase.

Once you’ve built the basic document framework, create document variables as placeholders for information that changes for each document. Then, add company logos and other custom branding to stylize the document.

Should RFQs be generic or personalized?

While building the template, decide whether the RFQ should include names and addresses or remain generic.

You can share a generic RFQ via link or copy it across multiple emails without changes, while a document with placeholders for details like company names and contact information will need to be personalized before you can send it.

Once you’re done, save that document as a reusable template. 

From this point forward, procurement teams can generate RFQ documentation each time they initiate the procurement process.

2. Populate the RFQ with purchase-specific details

Once the template has been created and approved, procurement teams can generate an on-brand RFQ document. However, the template will have specific gaps that need to be filled out before it can be sent.

After generating a document from the template, teams should replace the variables created during setup, then work through the document and update any requirements that are unique to this sourcing request. 

Because the underlying structure is already in place, most of this work should be limited to replacing or adjusting the information that changes from one RFQ to the next.

Before moving on, review the completed document to make sure vendors have everything they need to prepare an accurate response.

3. Review and finalize the RFQ template

Once the purchase details are set, take a few minutes to check over the RFQ from the vendor’s perspective.

Adjust any introductory copy, instructions, or supporting context so that the request makes sense for the suppliers who will receive it. Remove any sections that don’t apply, add any relevant documentation, and make sure the vendor knows who to contact with questions.

If your template includes placeholders for specific company names, addresses, or points of contact, update those fields.

The underlying template can stay consistent, but each RFQ should still feel like it was created for the purchase at hand, not copied from a generic document.

Once this step is complete, send the RFQ through any approval workflows (optional) for a final sign-off.

4. Send and track the document

After the RFQ is reviewed and approved internally, it’s ready to send to vendors.

With PandaDoc, teams can send documents via email or link and then track their status from the dashboard. When sent this way, the RFQ doesn’t disappear into an email thread once it leaves your hands. You can send secure links to all recipients. Teams can monitor recipient activity and use that information to manage follow-ups as the submission deadline approaches.

By keeping everything on the platform, handoffs between document preparation and vendor response management become much cleaner. The process stays in one place, giving the team more time to compile and compare supplier quotes.

Build your RFQ workflow with PandaDoc

RFQs are much easier to manage when teams don’t have to rebuild the process from scratch every time.

Using PandaDoc, teams can create reusable RFQ templates as part of a workflow that enables faster speed and greater document consistency. Template documents look similar, and prebuilt information with customizable placeholders lets teams adjust RFQs on the fly without starting fresh each time.

Combined with workflow automation and approval tools, PandaDoc can reduce RFQ creation from hours to minutes.

Want to give it a try? Sign up for a free 14-day trial or get a personalized demo.