To RFP or Not to RFP?

Finding a new website development agency is never an easy task. Merchants are often running on limited resources, limited employees experienced in web development, and limited time. For those with a lack of knowledge in the field, the procurement process can be particularly daunting. Sometimes It can be a struggle to articulate what technically is required for the project or know what a realistic budget is. Therefore, merchants that put out Requests For Proposals (RFP) often do not fully understand what it is they need. Thus, the request for information in the first place.

The other option is to hire a partner or agency without engaging in a formal RFP process. Merchants who tend to go this route may feel comfortable explaining or requesting technical requirements needed for a new project without engaging in a formal RFP process. Perhaps they’ve worked with a partner before or are heavily involved in the day-to-day management of the website. Regardless of the method used to hire a new partner and why, the process is essential. A new partner is likely going to play a significant role in the planning, building, and strategy required for a new project. Hiring the best partner for the job is vital.

There are pros and cons for an RFP process vs directly hiring an agency or partner. Understanding each will make it easier to decide what’s best for your business.

The RFP Process

Typically, the RFP process is time-consuming and regimented. When creating an RFP, merchants must request information in a specific, formal format. Meaning that businesses who respond to the RFP are limited in the information they can offer. Responses generally only provide the information requested. In other words, merchants will likely not receive alternative solutions. A lack of guidance can be challenging as frequently, the companies seeking RFPs in the first place are the very businesses who need the extra insight that would come from a scoping, or a get-to-know-your-needs call typical in a non-formal RFP situation.

Further, with an RFP process, it’s difficult for responders to sufficiently explain alternative solutions or offer creative, experienced input for optimizations. As the merchant, hiring an experienced partner that can not only fulfill needs but also provide alternative solutions that could simplify or enhance the project should be the end goal.

Pros of an RFP Process:

• Receive multiple bids from a variety of partners
• Learn more about what’s available in the industry
• Easily review pricing

Cons of an RFP Process:

• Often a time-consuming process (more responses is not necessarily a good thing)
• Requires a significant amount of work and planning for the merchant
• A formal process that often lacks creativity
• Room for misunderstandings and communication breakdowns
• Responders may not be technically capable
• The process can put an exaggerated focus on price (Winner chosen may be based on price alone)

The RFP process often wastes a lot of valuable time for the merchant and rarely generates reliable information. Inexperienced developers win RFPs due to low price quotes alone. For complex eCommerce website development, particularly for large websites, bottom dollar isn’t always the best answer. No matter how tempting it may seem. Merchants end up paying for those decisions in the long run when things break, cost more than expected, or go unfinished due to inexperience.

A Non-Formal Approach

Merchants who already have technical experience or familiarity with eCommerce development often choose to write down their project requirements and skip the formalities of the RFP process. This approach still requires diligent research of the various development partner options. Merchants will need to review the types of services offered as well as particular strengths for each partner and case studies; ensuring they are confident in the agencies ability to perform the work needed.

It’s important not only to review technical capabilities, certifications, and price but also to decide if they’re people who feel like a good personality match. Personality and getting a good feel for how the partner will work is one of the advantages that the non-formal approach has over the RFP process. A large part of hiring a partner is creating a good working business relationship. A great development partner will have your back and be honest when it’s required.  

Pros of Directly Hiring an Agency or Partner:

• Get the experience required
• Generates reliable and valuable information
• A more efficient focus on project requirements
• Get started on a project faster

Cons of Directly Hiring an Agency or Partner:

• Seeking new agencies requires a proactive approach
• Potentially more costly due to experience

The non-formal approach requires a more hands-on approach from merchants vs. an RFP process. Researching and contacting various agencies will require some upfront effort and time. However, the process of getting to know different agencies will offer plenty of value. A new project will often require a certain amount of thoughtful brainstorming and planning. With a direct hire approach, partners will be able to advise and guide merchants through the process while offering solutions that may not have been previously considered.

Making a decision

Regardless of the approach to hiring a partner, it’s critical to do some due diligence when it comes to researching agencies and developers. Merchants often send out RFPs thinking they will gain free knowledge and a very objective view from bidders but don’t realize that the RFP process often hinders agencies in doing good discovery and to quickly focuses management on making a price based decision. For many industries such as non-profit organizations, competitive pricing is an economic necessity. Such is not the case however for Magento eCommerce development. Your agency partner needs to be able to provide a solution that requires a thorough understanding of business requirements. In addition to price, both knowledge and experience need factoring into a final decision.

Experience has shown us that there is often a lack of understanding and communication within the RFP process. Both parties experience wasted time, energy, and resources. Further, agencies regularly win due to pre-existing relationships with the merchant or because of emphasis placed on the final cost instead of the quality and integrity of the project.

While RFPs may seem like a good idea to receive similarly scoped information and quotes, the better solution is to take a highly communicative approach focused on the long-term quality and reliability of the potential partner.

If you are interested in learning more about our Magento eCommerce experience, or how we can help with your project, contact us today!