Government agencies offer businesses the opportunity to sell billions of dollars worth of products and services. Many government agencies require that some percentage of the procurements be set aside for small businesses. This guide provides information that explains how to become a federal contractor, how to find business opportunities, and the rules and regulations that federal contractors need to follow. The emphasis of this guide is on doing business with agencies in the Executive Branch of the federal government. Agencies in the Legislative and Judicial branches have their own, yet comparable, contracting procedures and requirements.

What is a Request for Proposal?

A Request for Proposal (referred to as RFP) is an invitation for suppliers, often through a bidding process, to submit a proposal on a specific commodity or service. A bidding process is one of the best methods for leveraging a company's negotiating ability and purchasing power with suppliers. The Request process brings structure to the procurement decision and allows the risks and benefits to be identified clearly upfront.^{[citation needed]} The Request purchase process is lengthier than others,^{[citation needed]} so it is used only where its many advantages outweigh any disadvantages and delays caused. The added benefit of input from a broad spectrum of functional experts ensures that the solution chosen will suit the company's requirements.

The RFP may dictate to varying degrees the exact structure and format of the supplier's response. The creativity and innovation that suppliers choose to build into their proposals may be used to judge supplier proposals against each other, at the risk of failing to capture consistent information between bidders and thus hampering the decision making process. Effective RFPs typically reflect the strategy and short/long-term business objectives, providing detailed insight upon which suppliers will be able to offer a matching perspective.^[1]

Similar requests include a Request for Quotation and a Request for Information.

• Obtain correct information to enable sound business decisions.
• Decide correctly on strategic procurement.
• Leverage the company's purchasing power to obtain a favorable deal.

• Informs suppliers that your company is looking to procure and encourages them to make their best effort.
• Requires the company to specify what it proposes to purchase. If the requirements analysis has been prepared properly, it can be incorporated quite easily into the Request document.
• Alerts suppliers that the selection process is competitive.
• Allows for wide distribution and response.
• Ensures that suppliers respond factually to the identified requirements.
• By following a structured evaluation and selection procedure an organisation can demonstrate impartiality - a crucial factor in public sector procurement.