What Is an RFQ (Request for Quotation)?
Before a business commits to a supplier, it usually wants the same price question answered by more than one.
RFQ stands for Request for Quotation. It is a document a buyer sends to suppliers, usually several, listing the exact items, quantities, specifications and delivery terms, and asking each to reply with a price. In India it is common in manufacturing, construction, hospitals and government buying, where the replies are compared before a purchase order is raised.
What an RFQ Includes
The whole point is that every supplier answers the same question, so the request has to leave nothing to guesswork. A usable one carries:
- the item and its specification, down to grade or size
- the quantity and unit
- the delivery date and the delivery address
- whether prices should include GST and freight
- payment terms
- a reply deadline and, for longer jobs, how long the price must stay valid
An RFQ usually follows an internal purchase requisition, which is where someone first asked for the goods.
RFQ vs RFP vs RFI
All three are requests to suppliers, which is why they get mixed up. The difference is how much the buyer already knows.
| Aspect | RFQ | RFP | RFI |
|---|---|---|---|
| Asks for | A price for a fixed spec | A proposed solution and price | General information |
| Use when | You know exactly what you need | The need is open | You are exploring the market |
| Decided on | Price and terms | Approach, quality and price | No buying decision yet |
And the reply is a different document again. A quotation is the supplier’s answer to an RFQ, not the request itself.
RFQ Example
In September 2026, a fabrication contractor in Bokaro Steel City needs 600 pairs of gloves and 40 helmets for a plant shutdown starting on 20 September. It sends this request to four suppliers.
Four quotations come back by the deadline.
| Supplier | Gloves (per pair) | Helmet (each) | Delivery | Total |
|---|---|---|---|---|
| A | Rs.142 | Rs.385 | 5 days | Rs.1,00,600 |
| B | Rs.136 | Rs.410 | 9 days | Rs.98,000 |
| C | Rs.139 | Rs.372 | 6 days | Rs.98,280 |
| D | Rs.151 | Rs.360 | 4 days | Rs.1,05,000 |
Note: this is an invented example for illustration only. The contractor, suppliers and prices are not real, and totals exclude GST.
Supplier B is cheapest by Rs.280 but misses the seven-day window, and a shutdown waiting on gloves costs far more than that. So the order goes to C, which is exactly why the request stated the delivery window up front. The winning quote then becomes a purchase order.
Where RFQs Go Wrong
Frankly, most bad requests fail before a single price comes back. One supplier is asked by phone, another by WhatsApp with a slightly different spec, and the replies can no longer be compared honestly.
Leaving out whether freight and GST are included does the same damage, because a low headline rate can hide a high landed cost. Our comparison of HyperPure, DMart and local vendors explains why no single channel is cheapest for every item, which is the whole reason to ask more than one.
Central government buyers work under written rules (states have their own). The General Financial Rules, 2017, make GeM compulsory for goods and services listed there. Off GeM, most central ministries can buy goods up to Rs.50,000 without quotations.
Between Rs.50,000 and Rs.5 lakh, central ministries use a purchase committee, and up to Rs.50 lakh a limited tender under Rule 162, sent to more than three registered suppliers. Scientific departments buying research equipment get higher limits, revised from time to time. A private business has no such legal duty, though the same habit protects its margins.
A vendor evaluation template helps you score the replies on more than price.
Know Your Supplier Rates Before an RFQ
A price request goes out stronger when you already know your supplier rates.
For restaurants, Petpooja Purchase Manager, a free add-on with Petpooja POSS, compares prices across HyperPure, DMart and your local vendors on one screen. You can upload a local supplier’s rate card and see it side by side with the rest.
For retail businesses, Petpooja Invoice lists Customer & Vendor Management and Purchase Reports, so your supplier list and the rates you have actually paid sit beside your GST billing.
Take last quarter’s three biggest purchases and count how many suppliers were actually asked to quote.
Frequently Asked Questions
Request for Quotation. Some businesses write Request for Quote, and both mean the buyer’s written request for prices.
The buyer’s request is the question and the quotation is the supplier’s answer. One RFQ usually brings back several quotations, which are then compared.
Four or more is a safe habit. Under GFR Rule 162, a central government limited tender should go to more than three registered suppliers, and private buyers lose nothing by doing the same.
Generally, no. It only invites prices, and the binding step usually comes when the buyer accepts a quotation, typically by issuing a purchase order.
