IFBs and RFPs are solicitations created by government agencies to procure goods or services from private businesses. After a government agency creates an IFB or an RFP, government contractors can submit a bid to be awarded the contract. Although similar, there are notable differences between an IFB and an RFP that are important for contractors to understand.
Most notably, with an IFB, the government contractor’s primary goal is typically to provide the lowest bid, whereas the goal for an RFP is to show that you are the most qualified and capable to provide the goods and services that are required at a competitive rate relative to other bidders.
What Is An IFB?
An invitation for bid (IFB) is a sealed bid to complete a government contract. The sealed bid process, which follows a concept similar to a blind auction, allows government contractors to submit bids to provide necessary goods and services for the government agency. For the contracting agency, the goal of an IFB is typically to have goods and services provided for the lowest price possible.
When Would a Government Agency Choose an IFB?
Government agencies may issue an IFB if they have specific goods and services they need, have clear and exact contract details, and understand exactly how the work will be completed. An IFB can help government agencies receive the lowest price possible while still ensuring that the necessary quality standards for the goods and services are met.
They are not likely to use an IFB if they are unclear about the quantity or specific services they will need for a certain project or if they desire more detailed proposals to gain more insight as to the best way to complete a certain project.
What Criteria Do Government Agencies Consider for an IFB?
Government agencies primarily consider the bid price for an IFB and are less concerned with a detailed explanation of how the goods or services are provided, usually because the scope of work is clearly defined. Assuming the contractor is qualified to provide the goods or services needed, the lowest bid typically wins for an IFB.
What Are the Pros and Cons of an IFB for Government Contractors?
An IFB involves a simpler bid process since the primary consideration is the price. If you are qualified and capable to provide the goods or services requested by the government agency and you submit the fairest rate among all bidders, then you will most likely be awarded the contract. However, an IFB may limit your profitability if you are awarded the contract because the primary goal when sending the proposal is generally to provide the lowest bid.
What Is An RFP?
A request for proposal (RFP) is a request for government contractors to submit bids for a project. RFPs are more extensive than IFBs and ask the contractor to provide more than just a quote. In addition to the rate or price, contractors are asked to provide more details on how they would complete the work.
When Would a Government Agency Choose An RFP?
An RFP is often a useful way for government agencies to receive consulting services as well as receive proposals for contracts. They are most often submitted when the scope of work cannot clearly be defined. In this case, a simple monetary bid does not suffice as the agency requires more information as to how the job can be successfully completed on time and within a reasonable budget.
What Criteria Do Government Agencies Consider for an RFP?
The review process for an RFP is much more extensive. Whereas an IFB primarily involves a review of the bid prices, an RFP considers more details, including a request for how the work will be completed and an estimated timeline. The details contractors should include in a bid response for an RFP depend on the specifics of the RFP.
What Are the Pros And Cons Of An RFP For Government Contractors?
An RFP allows you to give more of a pitch as to why you should be awarded the contract. This is an opportunity to provide details of previous projects that are similar, outline how you intend to complete the project, and provide your rate for the work necessary.
You may also be able to profit more from an RFP on average than you would with an IFB as the government agency is considering far more than the bid price alone.