Procurement glossary
Plain-language definitions of the procurement and sourcing terms used across RFQmatch — from RFQs and tenders to Incoterms and total cost of ownership.
- Request for Quotation (RFQ)
- A procurement document a buyer issues to invite suppliers to submit price quotations for clearly specified goods or services.
- Request for Proposal (RFP)
- A procurement document inviting suppliers to propose solutions to a defined business problem, evaluated on approach as well as price.
- Request for Information (RFI)
- An early-stage document used to gather information about the supplier market before issuing an RFQ or RFP.
- Tender
- A formal, often public, invitation for suppliers to bid on supplying goods or services, common in government and large-enterprise procurement.
- Purchase Order (PO)
- A commercial document issued by a buyer to a supplier that authorises a purchase and forms a binding contract once accepted.
- Lead Time
- The total time between placing an order and receiving the goods or services.
- Incoterms
- Internationally recognised trade terms published by the ICC that define buyer and seller responsibilities for delivery, risk, and cost.
- Framework Agreement
- A long-term arrangement setting the terms under which a buyer can place repeated orders with one or more suppliers.
- Supplier Qualification
- The process of verifying that a supplier meets the buyer's requirements for quality, compliance, financial stability, and capability.
- Total Cost of Ownership (TCO)
- The full lifetime cost of a purchase, including acquisition, operation, maintenance, and disposal — not just the purchase price.
How to run an RFQ (Request for Quotation)
A step-by-step process for buyers to issue a Request for Quotation and select a supplier on a procurement platform.
- 1
Define requirements
Document the goods or services needed, quantities, technical specifications, and delivery location.
- 2
Set evaluation criteria
Decide how quotes will be scored — price, lead time, quality, certifications, and supplier track record.
- 3
Publish the RFQ
Issue the RFQ to a shortlist of qualified suppliers or publish it to a marketplace of verified suppliers.
- 4
Collect quotations
Receive structured quotes including unit prices, total cost, validity period, and delivery terms.
- 5
Evaluate and compare
Score quotes against the predefined criteria and clarify any ambiguities with suppliers.
- 6
Award and contract
Select the winning supplier, issue a purchase order, and formalise terms in a contract.