Request for Quotation (RFQ): How the Process Works

Short answer: A request for quotation (RFQ) is a document a buyer sends to multiple suppliers inviting them to submit prices for a clearly defined set of goods or services. It is used when the requirement is well specified and price is the main deciding factor. Suppliers bid on identical terms, letting the buyer compare like-for-like and choose the best value. This guide is part of the complete guide to corporate procurement in Malaysia.

What Is an RFQ?

An RFQ is a competitive sourcing tool. Once a need is defined and an internal purchase requisition is approved, the buyer issues an RFQ describing exactly what is required — specifications, quantities, delivery location, and timeframe — and asks suppliers to quote a price. Because every supplier responds to the same specification, the quotes are directly comparable.

RFQs are best suited to standardized, well-understood purchases where the buyer knows precisely what they want and is primarily comparing price and delivery terms.

RFQ vs RFP vs RFI

These three sourcing documents serve different purposes:

• RFI (Request for Information) gathers general information about the market and potential suppliers. It is exploratory and does not ask for firm pricing.
• RFQ (Request for Quotation) asks suppliers for firm prices against a defined specification. Used when you know what you need and want to compare cost.
• RFP (Request for Proposal) asks suppliers to propose how they would meet a broader need, evaluating approach, capability, and price together. Used for complex or solution-based purchases.

Use an RFQ when the requirement is fixed and price-driven; use an RFP when the solution itself is part of what you are evaluating.

What an RFQ Should Include

• A clear, unambiguous specification of the goods or services
• Exact quantities and units
• Delivery location and required dates
• The pricing format you want quotes returned in (so responses are comparable)
• Submission deadline and validity period for the quote
• Payment and contractual terms

The RFQ Process, Step by Step

1. Define the requirement. Specify exactly what is needed so all suppliers quote on the same basis.
2. Select suppliers to invite. Draw from your approved or pre-qualified supplier list.
3. Issue the RFQ. Send it to the shortlisted suppliers with a clear deadline.
4. Receive and clarify quotes. Collect responses and resolve any ambiguities.
5. Compare and evaluate. Assess quotes on price, delivery, and terms. This often feeds directly into formal supplier evaluation.
6. Award and order. Select the winning supplier and raise a purchase order.

Why the RFQ Step Matters

The RFQ is where supplier competition and price transparency do their work. Running a structured RFQ instead of buying from a default supplier routinely surfaces better pricing and prevents overpaying. It also creates a documented, defensible record of why a supplier was chosen.

Simplifying RFQs on a Marketplace

For catalog and indirect categories, a B2B marketplace can remove much of the RFQ overhead entirely: pricing is already competitive and transparent across many suppliers, so buyers compare options instantly rather than issuing quotes for every purchase. Lapasar aggregates more than 10,000 verified suppliers and over 2 million SKUs, giving Malaysian buyers price comparison built in. To see how sourcing connects to the rest of the cycle, read the corporate procurement guide.