Why are they asking that?

I recently responded to an individual's question about a company that issued an RFI and was looking for the companies to provide them with a list of exceptions or objections. Any time you have an unusual request, and asking for exceptions or objections at an RFI stage is in my opinion unusual, you should always ask yourself “Why are they asking for this and how will the use this information?”

The simple fact is RFI’s are never a binding document. Frequently companies will change things between RFI requirements and what they include in a RFP or IFB, so you want the flexibility to change your position based upon both any changes they made. You also may want to make changes to reflect changes to your business that may have occurred in the interim. If you have business near capacity you may be stricter in what you require versus when you need the work.

My opinion was the company may have been be doing that to screen out potential suppliers based upon the exceptions or objections. Alternatively they may want to be use it as a negotiation tool for when there is a RFP or Bid situation, where they would point out that you didn't object to them in the RFI. The consensus was to keep any exceptions or objections you provide to an absolute minimum if you want to be considered for the work. If I did provide exceptions or objections, I would also make it clear that they a subject to change either way and are based only upon the information that you have seen in the RFI. As such, they may be expanded upon or could be eliminated once you see the full documents for the bid or proposal. That way you are not giving them ammunition to eliminate you from consideration and as there undoubtedly will be changes between the documents, you have reserved the right to change your positions. Another reason why I would avoid providing a list of exceptions or objections at that stage comes from the old saying “you only have one time to make a first impression”. If you set a negative example, not only may you not get to bid on that work, you could also be not considered for other work in the future.

The same advice goes in part when you are bidding work. If the Buyer request prices at different volumes and you know that some of the volumes are far in excess of what they will purchase, beware. Ask the same questions, “why are they asking it and how will the use it?” It’s not uncommon for a buyer to want to buy at a 100,000 unit price, when they are only buying 10,000 units or less. If you must bid those volumes you could propose them as step pricing, where the actual pricing only goes down after the customer has purchased those volumes. Alternatively you could offer that price with a bill-back requirement if they fail to meet those quantities. One of the things you discover is when there is a cost that will be charged back if they fail to purchase those volumes, the volumes get more realistic.

Supplier non-confidential information – can you and should you share it?

In another forum a procurement person asked whether they could share one supplier’s specifications with another supplier. Aside from the ethics of doing this, before you share any information that you received from one party with another party you need to do your research.

The first question to ask is under what conditions did I received the information? Many times a company may require a non-disclosure agreement for receipt of detailed specifications. If you didn’t receive it under an NDA that doesn’t mean that you can share it. The second question to ask is whether the documents are copyrighted? Most technical specifications are copyrighted. If they are copyrighted you then need to read the copyright notice to determine what, if anything, you are authorized to do with that copyrighted material. For example the copyright notice may restrict you from copying the material or may limit your use of those materials to your internal use, which would prevent your sharing of the materials.

If you didn’t receive it under confidentiality obligations and it wasn’t restricted to internal use, you could potentially allow the other supplier to view it. That is where the issue of ethics comes into play. I believe that you should treat supplier non-confidential information in the same way you would want your non-confidential information to be treated. If you don’t want them sharing your information with their other customers (who may be your competitors) then you shouldn’t be sharing their non-confidential information with their competitors. You probably don’t need to
as these days many suppliers post their data sheets or technical specification for their products on-line for prospective buyers to view them. If the other supplier knows what product you are buying and who you are buying it from, they should be able to do the research themselves. As they are competitors they should already know exactly what their competition is selling. Many times they probably have also purchased the competitors product to do a technical analysis of the product, how its made, the materials used, etc..