The RFP: Pros and cons
Go beyond routine practices to get maximum value and protect your business
The request for proposal (RFP) is the standard practice that single- and multi-site purchasing professionals engage in to source critical systems and services to run their business. The benefits to the RFP approach include:
- Clearly defined parameters
- Well-documented process
- Equal opportunity for each participant
- Clear snapshot of the market provided to purchasers
The RFP provides a familiar, well-established path for purchasing professionals of all experience levels, ability and market knowledge to make critical sourcing decisions according to management’s specification.
But what’s next? Once results plateau, managers challenge their departments to go deeper and keep driving benefit. Does the standard RFP with baseline benefits enable an operation to evaluate vendors and solutions through a more integrated, strategic path to cost reduction and process optimization?
Here’s where traditional RFPs fall short for pallet programs:
- The RFP offers a snapshot of the market price for a pallet, but does not provide the most accurate picture of a constantly evolving lumber market
- Key manufacturing, packaging and distribution factors that determine sourcing decisions may change after agreements are signed
- The specifications on which the RFP is based may be outdated, ill-advised or no longer optimized for the operation
The limits of the traditional RFP expose purchasers to unknown risk. With disparate vendors filling out RFP sheets, purchasers relinquish control over the level of supply chain risk, instead leaving the choice with a vendor who may not share the same standards. The traditional RFP also relies on a simplistic, surface-level perception of cost that does not consider factors that could alter the entire cost-basis.
Conversely, Pallet Alliance takes a holistic, thorough approach to cost-reduction, product and process optimization that identifies, assesses and manages each operation’s unique site-specific factors that drive cost. This includes assessing operational history, current status and forward-looking goals. This assessment combined with Pallet Alliance’s processes and expertise enables businesses to find what’s next and reach even greater heights.