In the life of every Commercial Card program, there will be a time—likely multiple times—when a request for proposal (RFP) process is required or desired. If you have already participated in such a project, then you probably have a list of lessons learned that will benefit future RFPs. Conducting a good RFP process helps establish a good end-user/provider relationship and, ultimately, a successful card program. Before you embark on another RFP project, consider the below tips from industry experts.
The following content originates from sessions at the 17th Annual NAPCP Commercial Card and Payment Conference.
Preparing the RFP
- Do not reuse the same RFP as what you used before, especially if you are not happy with the current program/provider.
- Identify what matters most and pare down your RFP accordingly. Out of all the possible data points you can include, which ones are most important to your business case and future goals? I could not agree more. I think there is a tendency to ask too many things that do not impact the decision. The opposite problem is not asking key questions, such as ones pertaining to customer service.
- Evaluate your RFP for clarity. Unclear questions can result in bidding providers including more information than what is necessary, causing more review work for you and the project team.
- Save contract terms for the negotiation stage. When your RFP includes contract terms to which the provider must agree in order to submit a proposal, it will require them to obtain legal review first. This increases the time they need before responding and it could mean they cannot respond at all if your timeline is too tight.
- Provide details about your current card program(s), including as many metrics as possible. See examples...
Evaluating the Responses
Preparing a good RFP is just the beginning. Take equal care when designing the evaluation process.
- Use a weighted matrix, developed in advance, to evaluate proposals. Place more weight on the items most important to your organization.
- Each team member should evaluate/score the proposals independently before the team comes together to discuss.
- Do not be swayed by “bright shiny things” that a provider might include within the proposal. These things can be distracting when they pertain to something that falls outside your requirements. Ensure the provider can meet core competencies first.
- Proposals offering big checks/payouts can also be distracting. This leads to another important point, as described in the next column.
Dollars vs. Basis Points
Within his conference presentation, Frank Martien, Partner, First Annapolis Consulting, encouraged end-users to look beyond the basis points (bps) noted within a provider’s proposal. He makes the case that end-users can earn more rebate dollars with lower basis points if the provider helps you capture more card spend by acting as a key partner in your program. For example, how will a potential provider specifically help you:
- convert more suppliers to card payments?
- further automate internal business processes, as well as key suppliers’ business processes?
- obtain program buy-in from your management?
- increase your card usage?
If you have RFP experience that you would like to share for possible publication by Recharged Education, please submit a contact form. I would love to hear your advice and lessons learned. Alternatively, provide a comment below.
About the Author
Blog post author Lynn Larson, CPCP, is the founder of Recharged Education. With more than 15 years of Commercial Card experience, her mission is to make industry education readily accessible to all. Learn more…
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