Request For Quote - RFQ

AAA

DEFINITION of 'Request For Quote - RFQ'

A type of bidding solicitation in which a company or organization asks outside vendors to provide a cost quote for the completion of a particular project or program. A Request For Quote is a variation of a Request For Proposal (RFP), and typically provides more information to the bidder about the project's requirements. It often requires the bidder to break down costs for each phase of the project so as to allow the soliciting company to compare different bids.

BREAKING DOWN 'Request For Quote - RFQ'

The use of a Request For Quote is more likely to occur in situations where products and services are standardized, since this allows the soliciting company to compare the different bids easily. It is also more likely to be used when the soliciting company knows the volume of products that it wishes to purchase. For example, a government agency looking to buy 500 computers with a particular hard drive size and processing speed will send out an RFQ. Because the product is standardized, the agency is better able to compare different quotes to see which one is best suited.

RELATED TERMS
  1. Request For Proposal - RFP

    A type of bidding solicitation in which a company or organization ...
  2. Contractor Fraud

    Illegal business practices committed by firms hired to reform, ...
  3. Bilateral Contract

    A bilateral contract is a reciprocal arrangement between two ...
  4. Bid

    1. An offer made by an investor, a trader or a dealer to buy ...
  5. Independent Contractor

    A self-employed taxpayer that controls his or her own employment ...
  6. BCG Growth Share Matrix

    A planning tool that uses graphical representations of a company’s ...
Related Articles
  1. Entrepreneurship

    Don't Get Sued: 5 Tips To Protect Your Small Business

    Find out what you can do to limit risk and keep your business running smoothly.
  2. Entrepreneurship

    Start Your Own Small Business

    Quit your job, be your own boss and earn a paycheck. Find out what to do to make it happen.
  3. Entrepreneurship

    Small Business: It's All About Relationships

    Rather than be a jack-of-all-trades, an owner should rely on a network of trusted experts.
  4. Economics

    What is a Code of Ethics?

    A code of ethics is a collection of principles and guidelines an organization expects its employees to follow.
  5. Economics

    Explaining the Balanced Scorecard

    A balanced scorecard is a metric that measures a business’ performance.
  6. Stock Analysis

    Salesforce and SAP: Don’t Expect the Same From Both

    Take a look at the similarities and differences between SAP and Salesforce in the customer relationship management (CRM) software marketplace.
  7. Professionals

    How Agile Principles Are Used in Holacracy

    Holacracy itself has been an actively utilized management system since 2007 with its framework rooted in agile methodology.
  8. Economics

    What's an Irrevocable Letter of Credit?

    An irrevocable letter of credit (ILOC) is a financing vehicle used to facilitate commerce between two parties who are not familiar with one another.
  9. Stock Analysis

    Southwest Airlines: Delta's Worst Enemy?

    Learn about the rivalry between Southwest Airlines and Delta. For decades, Delta was the major operator in the South, but it has been displaced by Southwest.
  10. Economics

    What Does Business-to-Business Mean?

    The term business-to-business refers to transactions or communication that takes place between two or more businesses.
RELATED FAQS
  1. How are joint ventures regulated in the United States?

    Joint ventures are a very specific type of business arrangement. They can be organized in several different legal structures, ... Read Full Answer >>
  2. How long does it take to execute an M&A deal?

    Even the simplest merger and acquisition (M&A) deals are challenging. It takes a lot for two previously independent enterprises ... Read Full Answer >>
  3. How do a corporation's shareholders influence its Board of Directors?

    The 21st century has seen a rapid increase in shareholder activism, such as the general awareness, involvement and influence ... Read Full Answer >>
  4. What protections are in place for a whistleblower?

    Whistleblowers can play a critical role in ensuring the compliance, safety, honesty and legal fairness of governments and ... Read Full Answer >>
  5. What are some types of financial netting?

    Whenever two parties in any financial relationship square up or consolidate their accounts with one another, it is called ... Read Full Answer >>
  6. Can I buy insurance to reduce unlimited liability in a partnership?

    Partnership insurance is actually quite common. Most of the time, partners buy insurance to safeguard against the possibility ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Recession

    A significant decline in activity across the economy, lasting longer than a few months. It is visible in industrial production, ...
  2. Bubble Theory

    A school of thought that believes that the prices of assets can temporarily rise far above their true values and that these ...
  3. Stock Market Crash

    A rapid and often unanticipated drop in stock prices. A stock market crash can be the result of major catastrophic events, ...
  4. Financial Crisis

    A situation in which the value of financial institutions or assets drops rapidly. A financial crisis is often associated ...
  5. Election Period

    The period of time during which an investor who owns an extendable or retractable bond must indicate to the issuer whether ...
  6. Shanghai Stock Exchange

    The largest stock exchange in mainland China, the Shanghai Stock Exchange is a nonprofit organization run by the China Securities ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!