Basics on Writing and Submitting RFPs.

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If you are reading the 7 Steps to a Successful Energy Monitoring System series, maybe you’re wondering how to develop your own Request For Proposal so you can hire your own contractors and manage the process yourself.

Frankly, it isn’t horribly difficult. If you’ve been following the 7 steps, you already have the plans. That is one of the hardest parts.

Next, remember that there are no universal rules for this. You will, however, be asking contractors to invest their time in a competition for your business. They all know it is a risk on their part, but if you are fair and follow the criteria you outline in your request, they will generally respect your decision when it is made.

The RFP

You will want to start by drafting a Request for Proposal (RFP) letter.  State clearly who the RFP is directed to and what your objectives are. Define the scope of the project and specify your timeline including the deadline for the bids and when you plan to announce the results. When do you expect work to start? And finish?

You should also list the criteria you intend to use to make the selection.

Selection Criteria

This is the other hardest part and you will want to spend some time defining this. For example, if you expect the contractor to have experience in energy metering systems (a good idea), you should list your experience requirements and ask for references.

Usually price will be a consideration but not always the top consideration. Where does price fit into your selection algorithm?

Do you want the contractor to merely have a local presence or do you want to reserve your business only for other locally based businesses?

Is the size of their operation important to you? Financial stability? 

Will you require a performance bond?

Will you be making the decision directly from the bids or will the bids be used to narrow the field down to your final 3 or 4 candidates? Will you expect a live presentation from your top candidates? When? How long?

Again, it is important to thoroughly think through all these things. What is most important to you? Make sure the RFP makes that clear.

Pre-bid meeting

As you distribute the RFP, it is often desirable to schedule a pre-bid meeting where potential contractors can ask any questions they might have regarding the RFP and the project. It is in your best interest to get as much good information out to the candidates as possible as this will allow them to provide more informed and reliable proposals.

Walk-through?

Generally, a contractor will need to do an on-site inspection of your facilities in order to accurately predict the amount of work that will be required to fulfill the requirements of your project. You should plan to schedule a time when all interested parties can meet at your site and participate in a guided walk-through of your facilities. This could happen at the same time as the pre-bid meeting but should definitely happen soon enough to allow candidates ample response time before the deadline. 

Itemize

If you think you might want to do some of the work in-house, make sure you let the contractors know and request that they itemize in such a way that you can identify and separate the costs of the work you are planning to do.

Distributing the RFP

When the letter is done, bundle it with the plans (electronic copies are recommended) and send it out to your list. Other contractors will hear about this either through your advertisements, your employees or from their friends. You will need to decide if you’re willing to consider a larger pool. If you are, be ready to send the letter and plans to those who request them. Otherwise, be clear from the outset that the short-list has already been determined.

Closing the Bid

When the deadline arrives, close the bidding, send out thank you letters to all the bidders and let them know when they should expect a decision. Review all the bids and follow your stated criteria for making the selection(s). At this stage, you might also want to make your final decision regarding in-house work. The bids will help you determine if in-house work is cost effective. Sometimes a contractor that specializes in this type of work can complete work faster and less expensively than you can hope to do yourself. It can also be liberating to let someone else take responsibility for the work.

One caution

Some contractors will look at the materials list and substitute other brands or products. By and large, we are agnostic regarding meter brands but there are some substitutions that should not be made. If a bid includes substitutions, I strongly suggest that you verify with the design firm that those substitutions are suitable before awarding the bid.

Communicate with your Bidders.

When you’ve made your decision, promptly notify all the participants – winners and losers. It isn’t fair to leave people wondering where they stand.

Final presentations?

If you plan to require in-person presentations from your top bidders, schedule those presentations right away while giving the candidates sufficient time to prepare. Assuming they knew about this step from the beginning, they should only need a few more days to be ready.

Having already established your criteria in the previous phase, you should use these presentation times to better understand how the contractor meets the criteria. You should also ask questions that give you insights into their personalities, how they like to work, and whether or not you are comfortable working with them.

It can be helpful to have several people from your organization (or even independent evaluators) who can go through your listed criteria and grade the presentations as to how well each candidate addressed them. 

After the presentations have all been given, take a few days to review the evaluations and make your final decision. As before, you should promptly communicate the results to the candidates.

Contract?

Finally, I would recommend that you execute a work contract with the winning contractor. I’m not an attorney and won’t try to tell you how to create the contract but experience has taught that you should implement legal protections in case something goes wrong along the way. If rights, responsibilities, expectations, and remedies are clearly laid out in advance, you’re far less likely to have to deal with problems later.

other resources

I wrote this to give you an idea of what is involved in preparing an RFP. It should in no way be construed to be a comprehensive treatment of the subject. If you decide to go down this path, I highly recommend that you spend additional time researching and reviewing other RFPs and other resources. There is a wealth of information online that can help you. 

Have you participated in the bidding process before? What advice would you give?

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