10 things vendors wish advisers knew about RFPs

Published
  • November 29 2017, 10:19am EST
Sending out bad RFPs is a critical misstep for benefit brokers and consultants. Top carriers are always in high demand, so if you send them a subpar request, they’re less likely to respond.

Moreover, vendor selection usually requires an extensive amount of time and resources, so it’s important to get your RFP right the first time to cut down on unnecessary back-and-forth emails that may leave you scrambling to put together results for you client at the last minute.

Simply put, we can’t afford to send out RFPs that frustrate our vendors. Here are 10 things vendors wish you knew about the RFPs you’re sending out — and how to make them better.

Introduction

Sending out bad RFPs is a critical misstep for benefit brokers and consultants. Top carriers are always in high demand, so if you send them a subpar request, they’re less likely to respond.

Moreover, vendor selection usually requires an extensive amount of time and resources, so it’s important to get your RFP right the first time to cut down on unnecessary back-and-forth emails that may leave you scrambling to put together results for you client at the last minute.

Simply put, we can’t afford to send out RFPs that frustrate our vendors. Here are 10 things vendors wish you knew about the RFPs you’re sending out — and how to make them better.

1) Endless RFPs are a problem for us — and you

Sending out lengthy RFPs can be tempting. It seems smart, diligent. But in reality, they're extremely problematic and even risky.

Why? Let's say you send out a 600-question RFP to 10 candidates. Assuming they all respond, that's 6,000 RFP responses for your team to analyze. This is too much information to analyze and a massive time investment.

Quality vendors may choose to focus on other opportunities where they can win business with less effort. Why send a 348-question RFP along with a 352-question security questionnaire when 10 “deal breaker” questions would suffice to get the vendor on a short list of top candidates?

Save everyone a lot of effort by identifying your crucial deal breakers that would
immediately disqualify a candidate. Begin your RFP process with those and use follow up rounds as necessary.

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2) You’re not giving us enough time to respond

We’ve heard countless horror stories from clients who were asked to answer a lengthy RFP in a matter of days or even hours.

If you’re asking vendors to answer hundreds of questions, two weeks may not be enough time. After all, your RFP is probably not the only the one they’re working on.

So, if you want to get responses from the best vendors, give them adequate time to respond. Keep the time frame balanced to the request.

3) You’re not telling us what we need to know

Set your vendors up for success by giving them all of the information that they need to create a proposal. Your RFP should be crystal clear on:

● Who you’re issuing the RFP for — provide as much information about your client as you can: industry, demographics, etc.
● Why you’re the issuing the RFP
● What the expectations are
● The target implementation timeline
● The POC’s name, job title, phone number and email

Also, be sure to include all of the necessary back-up information when you send out the RFP. There is nothing that drives a vendor crazier than having to provide a quote based on their best guess because there’s missing information.

4) You’re making us think we have no chance

Are you inadvertently communicating to your vendors that they have no chance of winning the RFP? You might be scaring them off if you’re:

● Slow to follow up when they ask for missing information or feedback
● You have a history of sending out RFPs to persuade the incumbent to lower their prices
● You invite too many vendors. No one has a high chance of winning, so why try?

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5) You haven’t done your homework

Not doing your homework before you issue your RFP is like interviewing job candidates when you’re not sure what position you need filled. It is a total waste of everyone’s time.

By the time you issue an RFP, you should have established your client’s needs, goals and priorities. You also should have fully defined what is in scope for your selection, and determined a budget. Most importantly, you should have vetted vendors to identify who can meet your requirements.

This will also cut down on the amount of time that it takes you to analyze the marketing results.

6) Your RFP is too generic

Let's be honest, too often our RFPs come out generic. We reuse questions without tailoring or tweaking them because it's just easier.

One-size-fits-all RFPs don’t work because:

● Every client that you generate an RFP for has unique needs
● You may leave out critical details that vendors need to provide a competitive quote
● It may keep you from identifying the best-fit vendor

You can absolutely reuse content and/or templates, just be sure to double-check them to make sure they're on point for each project. When your RFP questions are specific, tailored and relevant, vendors are far more likely to engage.

7) You’re focusing too much on cost

Yes, cost matters, but it’s not everything. And lowest cost isn’t always best. Look at what additional services higher-priced vendors are offering, and consider the trade-offs between these added features and the service that the low-cost vendor is offering.

Also, look for alternate ways to reduce costs without cutting rates year-over-year. Plan design changes, transparency tools and wellness programs are great ways to reduce total spend without slashing rates.

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8) We want to know why you’re issuing the RFP

You can’t answer a question you don’t understand. Neither can your vendors. Help them understand the unique facts and circumstances surrounding your overall project. Why are you issuing the RFP? What problems are you trying to solve? Is there any distinct information surrounding the group that vendors should know about? For example, is your group a sky-diving company that is difficult to insure?

Giving vendors context for your request allows them to truly understand your needs and provide you with the right information.

It’s also a good idea to create some room for them to present out-of-the-box suggestions. Ask a couple of open-ended questions in the RFP like, “Anything you’d like to add that we didn’t ask?” etc. They may have a solution that fully meets your requirements, but looks different than what you expected.

9) We don’t want a million follow-up emails

We all have too many emails sitting in our inbox. Your vendors are no exception, and they don’t want to barrage you with emails to get the answers that they need.

Skip the unnecessary back-and-forth by sending all relevant information in one email. This will prevent critical information from getting lost in someone’s inbox. Or if you’re using RFP software, message them directly in the platform and skip email entirely.

10) Responding to your RFP is like wearing a straitjacket

If you want the best carriers to respond to your RFP, it has to be easy. So don’t require that vendors provide:

● Physical delivery of RFP responses/proposals
● Shipping paper copies of RFP responses/proposals
● Requiring numerous copies
● Using complicated and/or confusing forms
● Forcing responses to be submitted in clunky portals
● Mandating Microsoft Word when Excel would work better