Are RFPs Right for Your Business? Your Comprehensive Guide to Winning Big Contracts

The world of Requests for Proposals (RFPs) can be daunting but fruitful for agencies willing to incorporate them into their business development funnel. Countless agencies and businesses have used RFPs and other procurement vehicles to scale into predictable, long-term, multimillion-dollar contracts.

This guide will walk you through the essential elements of RFPs, their benefits, how to identify the right opportunities, and strategies for success. Whether you are considering diving deep into the RFP game or just exploring it as a part of your business development strategy, this blog post will equip you with the knowledge to make informed decisions.

Watch this webinar for an in-depth discussion on how to determine if RFPs are right for you. You can also access the webinar slides here.

What Are RFPs Good For?

A Request for Proposal (RFP) is a formal document that outlines the specifics of a project and invites vendors to submit bids.  The RFP is both a document and a process, providing a structured way for organizations to solicit services or products from potential suppliers. Reading an RFP carefully will give you insight into the project's scope and even into how informed the client is about the project’s specifics, work style, and approach, as well as your level of competitive advantage in the process. You can read more about RFPs here.

You’ve likely heard people complain more often than applaud the RFP process. There is good reason for this - RFPs are a losing game. The average win rate for RFPs is about 30%, and anything close to 50% is considered an incredibly high success rate. That means you’re losing more often than you’re winning.

Moreover, the average proposal can take 10-20 hours to write. It can be even longer for more complicated proposals or if you’re just starting. So not only are you losing often, but you’re sinking an incredible amount of time into a competitive game. This is all in addition to the fact that RFPs are scattered throughout different marketplaces; every RFP is different, and these processes can take weeks or even months to close and convert into contracts.

Why would anyone ever want to deepen their RFP practice knowing these truths?

Because RFPs offer a reliable pathway to scale and long-term, predictable success. RFPs provide several benefits that can significantly impact your business growth and stability:

Long-term Contracts

RFPs often result in long-term engagements, providing consistent work and revenue over extended periods. Contracts frequently start at one year and can go as long as five or even seven years, with multiple extension options before they must be recompeted. This stability can help with financial planning and business growth.

Predictable Revenue

Winning an RFP means predictable income, which can be critical for planning and scaling your business. Contracts resulting from an RFP mean you can predict your revenue floor from that client for the next several months or years. Contract negotiations can also allow you to bake in price increases for long-term, multiyear contracts, meaning you can ensure your prices steadily increase to at least keep up with inflation.

Moreover, the easiest client to win is the one you already have. Once you have a working relationship with that client, additional business opportunities, through or outside the RFP process, will be easier to secure.

Breaking into New Geographies and Industries

It is impossible to travel everywhere and meet everyone who might be a client. Even lead generation tools have a limit on the number of prospects you can contact.

RFPs provide opportunities to expand your market reach into new regions and industries, helping you diversify your client base. Even if you don’t win every RFP, participating can put your name in front of potential clients and create networking opportunities that may lead to future business.

Testing Business Development Tactics

Adopt your A/B testing mindset into your business development! Responding to RFPs allows you to experiment with different business strategies, pricing models, and service offerings to see what works best. Whether custom designs, decks vs. documents, your company description, or anything else, applying to enough RFPs means having a large sample size to test business development approaches and come to conclusions with significance.

How to Spot a Good RFP

Every RFP is created differently and has a distinct need behind it. That is why it is critical to look for green and red flags that can inform your go/no-go process and improve your chances of success with any RFP.

Look for the following green flags that can save you time and effort in the long run:

• Explicit Budget Constraints: A clearly identified budget or budget range indicates that the organization has realistic financial expectations and has conducted an informed assessment of its needs. We’ve written at length about the importance of including budgets in an RFP.
• Key Project Dates & Timeline: Specific dates or a built-out timeline indicate a well-informed assessment and grants you the ability to plan. When looking at these dates, you should break them into two timelines: (1) The RFP Timeline and (2) The Project Timeline. 

For the RFP Timeline, look for opportunities to engage and ask questions (more in the next section), when the proposal is due, and when they expect to get back to you. For the Project Timeline, look at when the project is scheduled to kick off and close and when key milestones are meant to be closed. You can determine if there is a conflict for personal or professional reasons before sinking into the proposal process.

• Opportunities for Engagement: Opportunities for engagement are a great way to build and deepen relationships with the client before submitting your proposal. They also indicate that the organization is open to interaction and questions and values clarity and partnership. 
• Informed Reason for RFP: The organization has done its homework and understands its needs. You want to work with intelligent and informed people, and a well-written RFP is an excellent indicator of whether or not the client fits the criteria.
• Incumbents: If disclosed, this can offer valuable information about previous contractors and their performance. Look at who previously worked with them, what they liked or disliked about them, why they are going to RFP if they already had someone on the project, and if the incumbent is competing for the opportunity.

RFP Red Flags

There are plenty of RFPs out there that are just downright terrible. Be cautious of these RFPs by keeping an eye out for the following red flags:

• Ridiculously Tight Turnaround Time: Most agencies need about two weeks to develop a well-crafted and thoughtful proposal. Whatever your rule, if you come across an RFP that requires you to speed through a proposal to meet the deadline, you should skip it. Often, a tight timeline suggests a rushed or poorly planned project.
• Unreasonable or No Budget: What would your real estate agent tell you if you asked her to start looking for homes but you didn’t have a budget in mind? The same goes for an RFP. If the RFP suggests they need the moon and the stars, but they can’t afford to break past the atmosphere, then you should look to other projects where your time is valued and you can earn what you deserve.
• Uninformed or Conflicting Technical Details: You are the expert at what you do. If the RFP reads like it was written in a rush or some details conflict with each other, such as implementation deadlines or project requirements, it likely means that the proper research hasn’t been conducted on the actual needs. This is especially dangerous as it can create problems during any implementation stage or when measuring the project's success.
• Out of Office When Asking a Question: Lack of availability can signal poor management. For example, if you receive an OOO email from the contact person that says, “I won’t be back until the proposal is due,” go ahead and skip the RFP. 
• No Meeting or Q&A Allowed: Indicates unwillingness to engage or clarify, which can complicate project execution. Think about it this way: If they won’t spend a few minutes to answer your questions or schedule a meeting, why should you spend hours building a proposal for them?
• Oddly Specific Requirements: If you see an RFP that is so detailed and narrowed that it almost reads like there is someone specific in mind, that likely is the case. RFPs with oddly particular requirements can be written for someone else, reducing your chances of success on that RFP. Skip these RFPs so you can focus on the opportunities where you are better positioned to succeed.

If an RFP doesn’t meet these requirements or any other requirements you may have, give yourself permission to walk away. Especially if they are not your client, you don’t owe them anything, and you are better off keeping control of your time and resources than spending them on a losing prospect.

Strategies to Succeed: All In

If you decide to go all in on RFPs, commitment and consistency are vital to turning them into a reliable lever for growth. Here’s a detailed approach to help you succeed:

Set a Target

Define a Consistent Application Goal: Establish a clear and achievable goal for the number of RFPs you will apply to regularly. For example, you might aim to apply to one RFP per week for six months. This consistency helps build momentum and increases your chances of winning contracts over time. Regular application also sharpens your proposal writing skills and keeps you familiar with the latest industry trends and requirements.

Track Your Progress

Monitor Key Metrics: Use tools like Google Sheets, Pipedrive, or HubSpot to track your RFP application progress. Key metrics to monitor include:

• Win Rate: Calculate your win rate by dividing the number of RFPs won by the total number of RFPs applied. This helps you gauge your success and identify areas for improvement.
• Feedback: Collect feedback from clients, both positive and negative. Understanding why you won or lost an RFP can provide valuable insights for refining future proposals.
• Incremental Progress: Track stages of progress, such as reaching the interview stage, receiving follow-up questions, or making it to the final round. Each stage reached is a milestone worth noting.

Document Soft Wins: Soft wins, such as building relationships, receiving referrals, or gaining recognition, are crucial. Even if you don’t win an RFP, these outcomes can lead to future opportunities. Document these soft wins to understand the broader impact of your efforts.

Use Project Management Tools

Organize and Streamline Your Efforts: Repurpose tools like ClickUp, Asana, Trello, or Jira to manage your RFP responses efficiently. These tools can help you:

• Manage Tasks: Break down the RFP response process into manageable tasks and assign them to team members. Tasks include initial review, research, writing, editing, and final submission.
• Track Timelines and Deadlines: Set deadlines for each task to ensure timely completion. Visual timelines or Gantt charts can help you stay on track and meet submission deadlines.
• Collaborate with your Team: Facilitate collaboration by allowing team members to share updates, feedback, and files in one centralized location. This ensures everyone is aligned and can contribute effectively.
• Build Templates and Checklists: Create reusable templates and checklists for different parts of your RFP responses. This can save time and ensure consistency across proposals.
• Enable Tracking and Analytics: Use built-in analytics features to track your progress, measure efficiency, and identify bottlenecks in your process.

Stay Committed and Analytical

Consistency and Feedback Loop:

• Commit to a Long-Term Strategy: Understand that RFPs can take a long time to pay off. A commitment of at least six months is essential to see significant results. Consistent application and refinement are key to success.
• Analyze and Iterate: Review your performance regularly and adapt your strategies based on what works and what doesn’t. Use the feedback and data collected to refine your approach continuously.

By setting clear targets, tracking your progress meticulously, and leveraging project management tools, you can turn the challenging RFP process into a structured and efficient part of your business development strategy. This all-in approach can lead to long-term contracts, predictable revenue, and substantial growth for your business.

Strategies to Succeed: All Out*

If RFPs aren’t a core focus of your business development strategy, there are plenty of other levers for growth that you can pull. Nevertheless, the asterisk in All Out* means you can still participate selectively without overwhelming your resources. Here’s a detailed approach to help you succeed with a selective RFP strategy:

Make Exceptions

Apply Selectively: Even if RFPs aren’t central to your strategy, there are scenarios where applying makes sense:

• Personal Invitations: If you are personally invited to apply for an RFP, it indicates that the client is interested in your services. Personal invitations often have a higher chance of success because the client already trusts or is familiar with your work.
• Immediate Network Opportunities: RFPs within your immediate network, such as those issued by past clients, partners, or acquaintances, can be worthwhile. These clients are more likely to value your expertise and may prefer your services over unknown competitors.

Vet Carefully

When deciding whether to pursue an RFP, use the green and red flags discussed above to assess the opportunity carefully. This helps ensure you invest your time and resources in proposals with a higher likelihood of success.

Succeed with Market Research

Building solid relationships with project issuers and conducting thorough market research can significantly increase your chances of winning RFPs. Here’s how to succeed with a strategic approach:

Engage with the Issuer

Participate in Pre-Bid Meetings and Q&A Sessions:

• Understand Client Needs: Attending pre-bid meetings and participating in Q&A sessions are crucial to a deeper understanding of the client’s needs and expectations. These interactions provide an opportunity to ask clarifying questions, gather insights into the project scope, and learn about the client’s priorities and pain points.
• Showcase Interest and Expertise: Actively engaging in these sessions demonstrates your genuine interest in the project and your proactive approach. Asking insightful questions and providing thoughtful feedback can help you stand out as a knowledgeable and committed vendor.
• Shape the RFP: Sometimes, the questions you ask can lead to modifications in the RFP itself. By highlighting potential issues or suggesting improvements, you can help shape the final requirements to align with your strengths and capabilities.

One of our favorite award stories from Prosal is when a strategic planning agency shared that they won an RFP simply by following up promptly after the award date had passed. This demonstrated their attentiveness and project management skills, leading the client to select them based on their proactive engagement.

Network

Leverage LinkedIn and Other Platforms:

• Find Mutual Connections: Use LinkedIn to identify and connect with key stakeholders involved in the RFP process. Look for mutual connections who can introduce you to decision-makers or influencers within the client organization.
• Build Rapport: Establishing rapport with the project issuer or relevant contacts can give you valuable insights into the organization’s culture, preferences, and decision-making process. These relationships can make your proposal more tailored and relevant to their specific needs.
• Stay Engaged: Regularly interact with your network by sharing relevant content, commenting on their posts, and participating in industry discussions. This keeps you on their radar and reinforces your expertise and credibility.

In the early days of Prosal, one of the first big successes was when a digital agency won a coveted six-figure contract by using LinkedIn. The CEO used LinkedIn to find a mutual connection with a department manager at the issuing organization. This introduction helped them build a relationship and ultimately win a significant contract.

Build a Strong Team

Partner with Others to Strengthen Your Proposal:

• Complementary Expertise: Identify partners who can bring complementary skills and expertise to your team. This can enhance your proposal by demonstrating a broader range of capabilities and a more vital ability to meet the project requirements.
• Joint Ventures and Consortia: Forming joint ventures or consortia with other businesses can make your proposal more competitive. This approach is especially effective for large or complex projects where a single company may not have all the necessary resources or expertise.
• Present a Unified Front: When partnering with others, ensure your proposal presents a cohesive and unified front. Clearly outline each partner's roles and responsibilities and highlight how their contributions will add value to the project.

Additional Tips

Continuous Engagement and Relationship Building:

• Stay in Touch: Maintain ongoing communication with clients, even after completing the RFP process. This helps keep your company top-of-mind for future opportunities and fosters long-term relationships.
• Follow-Up and Feedback: After submitting a proposal, follow up to ensure it was received and inquire about the decision timeline. If you win, ask for feedback on what stood out in your proposal. If you lose, seek constructive feedback to improve future submissions.

Utilize Market Research Tools:

• Competitive Analysis: Use market research tools to analyze competitors and understand their strengths and weaknesses. This information can help you position your proposal more effectively.
• Industry Trends: Stay updated on industry trends and best practices. Incorporate relevant insights into your proposals to demonstrate your awareness of the latest developments and your ability to deliver cutting-edge solutions.

By strategically engaging with project issuers, leveraging your network, building solid partnerships, and continuously conducting market research, you can significantly enhance your chances of winning RFPs and driving business growth.

How to Use Prosal to Find Good RFPs

Prosal is designed to streamline your RFP search and response process by providing access to a comprehensive, vetted database of RFPs. Updated daily, Prosal ensures you always have access to the latest opportunities. The platform summarizes and standardizes RFPs, offering easy-to-read overviews highlighting critical details such as project scope, deadlines, and budget estimates, helping you quickly assess which opportunities are worth pursuing.

Key Features and Benefits:

• Comprehensive Database: Daily updates with new, vetted RFP opportunities.
• Alerts and Notifications: Stay informed of new opportunities that match your criteria.
• Standardized Summaries: Simplified overviews of key RFP details for quick assessment.
• Customizable Filters: Narrow RFPs by industry, location, budget, and project type.
• Collaboration Tools: Share RFPs, assign tasks, and track progress with your team.
• Performance Analytics: Track submissions, win rates, and feedback to refine your strategy.

By leveraging Prosal’s robust features, you can focus on high-potential opportunities, build more effective proposals, and ultimately increase your RFP win rate. Prosal helps you make informed decisions, streamline workflow, and enhance business development efforts.

Additional Resources for RFP Success

Here are some additional tools and resources to help you succeed with RFPs:

1. Prosal Business Template Resources offers a collection of top free business proposal templates that can save you significant time and effort. These templates are designed to be easily customizable and can be adapted to fit the specifics of any RFP you are responding to. Using these templates can ensure that your proposals are structured, professional, and comprehensive, helping you put your best foot forward in the competitive RFP process.
2. C4G Templates: Consultants for Good Templates provide a variety of templates specifically tailored for nonprofit consultants. These templates cover a range of needs, from proposals and contracts to project management documents. By leveraging these resources, you can ensure that your documentation meets industry standards and effectively communicates your value proposition to potential clients.
3. Chat GPT by OpenAI is a powerful AI tool that can assist you in generating content, brainstorming ideas, and drafting proposals. Whether you need help writing a compelling executive summary, crafting detailed project descriptions, or even proofreading and editing your proposal, Chat GPT can be a valuable virtual assistant that enhances your writing efficiency and quality.
4. Brieflink is a platform designed to create and share interactive documents. It allows you to track how recipients engage with your documents, providing analytics on views, time spent on each page, and more. This feedback can be invaluable in refining your proposals and understanding what aspects resonate most with potential clients. Brieflink’s features can help you make data-driven improvements to your RFP responses.
5. Airtable Business Development CRM Template offers a versatile Business Development CRM Template that can be customized to track RFP submissions, client interactions, and project progress. This tool combines the simplicity of a spreadsheet with the power of a database, allowing you to organize your RFP efforts, track key metrics, and collaborate with your team in real-time. It's ideal for managing complex workflows and ensuring no opportunity slips through the cracks.
6. Monday.com Business Development Tracker provides a comprehensive Business Development template that helps you manage your sales pipeline, track deadlines, and coordinate team efforts. This template is handy for visualizing your RFP timeline, assigning tasks, and ensuring all team members are aligned on their responsibilities. Its intuitive interface makes it easy to stay on top of multiple RFPs simultaneously and streamline your proposal process.
7. Decktopus is an AI-powered tool that helps you create visually appealing and professional presentations quickly. It's perfect for developing proposal presentations, pitch decks, and other visual materials accompanying your RFP submissions. Decktopus offers a range of templates and design elements to make your proposals stand out, ensuring that your visual aids are as compelling as your written content.

By integrating these tools and resources into your RFP process, you can enhance your proposals' quality, efficiency, and effectiveness, increasing your chances of winning new business opportunities.

Conclusion

Using RFPs effectively can transform your business development strategy. Whether you dive in fully or participate selectively, understanding the RFP process and leveraging tools like Prosal can help you turn these opportunities into significant growth levers. Stay committed, be strategic, and let Prosal guide you in finding and winning the right RFPs for your business.

Ready to level up your business development efforts with RFPs? Start using Prosal today and unlock new growth opportunities!