An invitation for bid (IFB), also known as an invitation to bid (ITB) or request for bid (RFB), is a formal solicitation made by a company or government agency that aims to obtain competitive bids from potential suppliers in a structured and transparent manner.
Once the invitation for bid is issued, the potential bidders will need to decide whether they wish to participate in the bidding process. If they do, they submit a bid according to the specifications in the IFB and prior to the expiry of the designated deadline.
Price and availability, rather than the bidder’s out-of-the-box ideas and plans for meeting the requirements, are the main determining factor when it comes to successfully winning a bid. As such the reason for issuing an IFB is often straightforward: secure the best bidder at the lowest market price for certain standardized products or services.
Note: The terms “invitation for bid” and “request for bid” are often interchangeable, some companies may prefer one term over the other, and they refer to the exact same procurement process of soliciting bids.
Clear invitations lead to comparable bids
IFBs should by all account be straightforward to create: You simply collect what you need, how much of it you need, where you need it delivered to and by when, and you put this all in a single document to be distributed to your potential partners of choice.
However, the devil is in the details. Are there specific tolerance requirements? What about certifications? Do you have enough storage capacity for goods to be purchased or should the order be delivered in batches? Should all batches be delivered to the same site? Lots of questions that only those directly involved are able to answer. Involving these stakeholders in the creation of the invitation (and seeking their approval) is absolutely mandatory to avoid any issues further down the line.
For the responding party: Price is important, but only after all the other boxes are ticked. To ensure that these criteria are met every single time, it makes sense to formalize a process and template the bid. An IFB is best replied to with an offer that is generated based on the latest data, which is then double-checked by both sales and production/inventory. In Salesforce this is easiest with Documill Dynamo. It’s important to keep in mind that once you submit your offer that’s it. There is likely no second round nor any negotiations.
- Use Documill Leap to orchestrate how you will involve the right parties in creating an IFB document that is formatted in such a way that it’s easy to respond to.
- Use Documill Dynamo to generate standardized bids from Salesforce data that are just as easy to understand as the invitations that they answer.
- Formalize and digitize your document creation processes to guarantee quality output every single time, regardless of whether you are buy side or sell side.
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