RFx Procurement Definitions
In the military we had a habit of communicating in acronyms, it actually felt cool when you knew something everyone else didn’t, a language of your own. Similar to a code base that only a select few can share with one another and it actually makes sense. If you’ve been on a call with our Catapult team you’ve probably noticed that we use certain words and acronyms universally. It’s intentional, I promise!
Catapult is the leader in Request for Proposal (“RFP”) automation across every industry and project type, and procurement teams have continued to benefit from our products which is a primary reason we don’t classify ourselves as a “Request for Proposal” solution, rather Request For X (“RFx”). It’s even on the back of our 👕 — email us for one 😊.
RFx is a universal term we use to describe Request for Proposals (“RFP”), Request for Information (“RFI”), Request for Qualifications (“RFQ”) and even Cyber Security, Due Diligence Questionnaire’s (“DDQ”), and every other type of project name. As we have continued to grow as a company and our support teams are trained with our industry language we have found it beneficial to share these definitions with our clients to help ease the burden of learning new abbreviations, acronyms, synonyms, and our terminology.
Acceptance criteria — Criteria used to determine whether a product or service meets system or customer needs, and is frequently used in software engineering/procurement.
Agreement — A legally binding contract, signed and executed by both the buyer and seller.
Alternate response — A replacement response representing a significant and intentional change to a provision or clause of a request by a vendor.
APMP — The Association of Proposal Management Professionals is an international organization that educates and advises procurement professionals about the arts and sciences of winning business.
Approved supplier list — A list of suppliers approved for doing business with. They have been vetted and meet all criteria for the business. This can include many factors, such as financial stability, compliance, and more.
APS — The American Purchasing Society is an organization of buyers, purchasing managers, executives, and others interested in the purchasing profession. Their objective is to provide professional procurement training and improve the business purchasing function through education and our certification program.
AUA — Assets Under Advisement is the measurement of the amount of assets a financial institution provides administrative services for and thus charges for. Some services include custody, taxes, fund accounting, and more.
AUM — Assets Under Management is the total market value of the amount of assets that a person or financial institution manages on behalf of clients.
Benchmarking — Comparing an element of one business, such as price, quality, or service, against another to help with decision making.
Best and final offer (BAFO) — A request for the vendor to make a revised pricing proposal with their best possible price.
Best value — The end result of a successful RFP that balances price and quality to meet the buyer’s needs.
Bid — An offer of a price for goods or services.
Bid/No-bid discussion — Is a way to consider various factors that will influence the viability and prioritization of a project.
Bidder — Is a potential supplier who responds to the RFP with a completed proposal including a bid.
Boilerplate — Responses that are the standard for repeated use in multiple proposals.
BPS — Refers to a common unit of measure for interest rates and other percentages in finance.
Business case — An internal document that presents an argument for purchasing a particular solution or to support pursuing a particular RFP opportunity and focuses on the expected benefits of potentially winning the bid. They also include the section of a proposal designed to give the customer justification for accepting the bid and making the purchase.
BRD — A Business Requirements Document is a document in an RFP that outlines the goals and expectations an organization hopes to achieve by partnering with the winning responder
Buyer — Also called an issuer, the vendor that intends to buy a service or product and issues an RFP to evaluate their options
CIT — Is a group of pooled accounts held by a bank or trust company. The financial institution groups assets from individuals and organizations to develop a single larger, diversified portfolio.
Closing date — The due date when all proposal submissions must be completed and returned to the issuer.
Competitive bidding — Used in government, this is a public bid that solicits companies to submit their best proposal to compete for a specific project in a fair and open process.
Compliance checklist — A list of specific customer requirements. The list is created by splitting complex RFP questions into individual requirements.
Cooperative purchasing — When two or more parties combine similar requirements to issue an RFP. This entity takes advantage of better terms due to higher volume and/or to reduced administrative expenses.
CPO — Chief Procurement Officer. This person is responsible for managing the overall procurement and supply within an organization.
CPP — Certified Purchasing Professional, which is a designation given by the APS in “recognition of purchasing knowledge, experience, and integrity.”
CPPM — Certified Professional Purchasing Manager, which is the designation after CPP.
DDQ — A questionnaire given by a potential buyer or investor to the company they are contemplating buying or investing in. The questionnaire is designed to obtain certain documents, records, and information from the target so that the buyer or investor can conduct due diligence on it
Debarment — When a person or business is no longer allowed to respond to specific RFPs, usually due to unsatisfactory work on previous RFPs.
Due diligence — An entity’s assessment of the risks involved in the supply chain and procurement process of a vendor to protect that entity from risk. It often takes into account company stability, policies, and employee training and uses a DDQ.
E-sourcing — Also known as e-procurement, this is an online business-to-business procurement process using web-based applications where buyers locate potential suppliers, Issue an RFx, and complete transactions directly over the internet. This is basically Catapult!
Elevator pitch — A concise explanation of the benefits of doing business with a particular vendor.
ESG — Environment, Social, and Governance are criteria that are used by socially-conscious investors and shareholders to screen investments and assess a company’s impact on the world.
Evaluation of responses — Is when issuers evaluate responders and determine each vendor’s responsibility and ability to meet RFP requirements.
Executive summary — A short summary of the key proposal components that is written for senior-level executives in the issuer’s organization.
GPO — Group Purchasing Organization is an organization that brings together the needs of small and medium-sized businesses to combine and increase their purchasing value.
GDPR — Is a regulation in EU law on data protection and privacy in the European Union (EU) and the European Economic Area (EEA). Catapult complies with all regulations and requirements needed for international commerce and data protection.
IFB — Invitation For Bid, which is a competitive process where issuers focus on measures that reduce costs, with responders focusing on cost-cutting, with usually the lowest bidding winning.
Imperfect competition — When many businesses are competing to win an RFP but each is selling a slightly different product, which makes comparisons difficult.
Issuer — The business or person that creates and sends an RFP to responders/vendors, soliciting proposals with the intent to buy a product or service.
Issues — Concerns of the Issuer that must be addressed by the bidder.
ITT — Invitation To Tender, often issued for construction and supply projects that have a finite date with more rigidity. Used by the government.
Joint venture — When two or more businesses partner to deliver a proposal, win the business, and deliver the agreed-upon products or services.
Knowledge Base — This is a centralized location where RFP and proposal content, questions, and documents are stored, indexed, and retrieved. This is content management in Catapult!
Knowledge management — The practice of regularly updating, organizing, indexing, and managing proposal content within a knowledge base.
KPI — Key Performance Indicator, measurable values that can be monitored to determine levels of achievement. Used in vendor evaluations
Life cycle cost — An evaluation that determines the cost of acquisition, operation, maintenance, and disposal of items.
Lowest responsible vendor — The lowest-priced vendor with acceptable metrics for the RFP.
M&A — Mergers, and acquisitions. Is a general term used to describe the consolidation of companies or assets through various types of financial transactions, including mergers, acquisitions, consolidations, and more!
Motivators — Motivators to buy, the fundamental reasons behind the customer’s need to make a purchase. Motivators are the underlying reasons an RFP is issued.
Multiple Award — When a contract is granted to multiple bidders who meet the RFP requirements.
NASPO — National Association of State Purchasing Officials. A non-profit association that helps state procurement through education, professional development, and research.
NIGP — National Institute of Governmental Purchasing. The Institute for Public Procurement is an association that “develops, supports and promotes the public procurement profession through premier educational and research programs, professional support, technical services and advocacy initiatives that benefit members and constituents since 1944.”
No bid — The response when a selected vendor chooses to not submit a proposal for an RFP.
NSFW — Not Safe For Work. Content that is objectionable in the workplace (you know what is and isn’t)
Offer — An invitation to enter into a legal contract.
PQQ — Pre-Qualification Questionnaire is when a buyer is looking to procure a supplier for a certain contract, and they need to evaluate the potential companies on particular criteria. This usually precedes an Invitation to Tender.
Preference — A characteristic of a vendor that an issuer finds favorable, like the location.
Pricing tables — A tool that allows buyers to collect, analyze, and present vendor pricing data in one clear format to determine which vendor best suits the organization or client’s needs.
Proactive proposal —. A proposal that is created without an RFP, often following a discussion with the potential customer.
Procurement process — The process of obtaining materials and services, which includes defining requirements, issuing an RFP, selecting a vendor, and contracting.
Procurement Department — Manages the process used for the purchase of goods and services by the organization and is responsible for managing the purchasing activity for the organization. Can be centralized and decentralized. In a centralized model, all requests for materials or goods are directed to this department. In a decentralized model, individual departments can process their own purchases
Project — A generic term to indicate all of the Request for X (“RFx”) project types.
Proposal — A response to the issued RFP by a vendor that has a solution to the problem, or solves a requirement or objective.
Proposal manager — Person responsible for proposal responses including scheduling, coordinating with subject matter experts to create responses, reviews, submission, and strategy implementation.
Public procurement — Government purchasing funded by taxation.
Qualified bid — A proposal where the potential supplier has exempted themselves from one or more of the requirements of the RFP. The proposal should state exactly why it does not meet the requirements.
Qualified vendor — A vendor that meets minimum requirements for the RFP and has earned placement on the vendor list.
Record Keeper — Is the investment custodian who buys and sells the mutual funds as directed by plan participants. In this role, they account for the buying and selling of the funds, the contributions to the plan, and the distributions to terminated employees.
Responder — The person or business that submits a response to an RFP.
Response — The offer received from a vendor in response to an issued RFP.
Responsive bidder — A bidder whose proposal meets the exact specifications of the RFP.
RFA — A notice that grants are available to fund certain types of programs. An RFA is usually released by a government agency or non-profit organization.
RFB — Interchangeable with RFP, yet responses are generally subject to negotiation.
RFI — Request for information, a document used to collect information about suppliers, often before a formal procurement process.
RFP — Request for proposal is a business document that announces and provides details about a project, as well as solicits bids from contractors who will help complete the project.
RFP cover letter — A one-page document introducing your proposal to the buyer.
RFP process — A systematic series of actions and steps designed to help businesses win bids.
RFP technology — RFP software, often cloud-based programs that offer a digital knowledge base and automated responses with internal and external collaboration. This is what Catapult is!
RFQ — A request for quotation, is a request for vendors to submit a quote for a particular service.
RFx — Request for ‘X’ is used to describe all types of questionnaires for evaluating and selecting vendors. Request for Proposals, Request for Information, Due Diligence Questionnaires, Security Questionnaires, Pre-qualification Questionnaires, and Marketing Questionnaires.
ROI — Return on investment is a way to evaluate the effectiveness of an investment based on money earned versus money invested.
Security questionnaire — Part of the procurement process to evaluate risk with questions about security controls, business continuity, and security policies.
SME — Subject Matter Expert has the responsibility to ensure the facts and details are correct so that the project’s/program’s deliverable(s) will meet the needs of the stakeholders, legislation, policies, standards, and best practices.
Solicitation — The process of communicating procurement requirements and requesting responses or bids from interested vendors. Basically, just issuing RFPs and RFBs.
Spend analysis — Spend analysis is the practice of collecting and analyzing data to decrease procurement costs and reduce overhead.
Strategic sourcing — A procurement process that uses ongoing evaluation of the purchasing activities of a company to reduce cost and improve quality.
Tender — The process that allows governments and financial institutions to solicit bids for large projects. Each tender has a specific deadline for submission.
Unsuccessful vendor — An unselected vendor. The proposal may be declined due to a number of factors such as price or estimated completion.
Vendor — Also known as a seller, responder, or bidder. The person or vendor responding to the RFP with the goal of providing a service or product.
Vendor management — Also known as supplier relationship management, the practice of improving a vendor’s impact on the buyer’s business by working collaboratively and developing new processes.
Vendor evaluation — A part of vendor management. The process of evaluating and approving new and old suppliers based on how well they meet the business’s needs.
Weighted scoring — The practice of setting weights or point values for sections in an RFP. Catapult does this for question sections automatically!
Zero-sum game — An interaction where every gain by one party is an equal loss to the other, so the net gain is zero.
This is the starting point to our library and throughout each year we will continue to add and modify this list. If something is missing, please let us know, we’d love to get it added.