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Selecting Third Party Logistics Providers Part 3: Third Party Logistics RFP

Selecting Third Party Logistics Providers Part 3: Third Party Logistics RFP


Choosing the best vendor the first time around is the best case scenario for any business. To help ensure the best vendor is chosen, utilizing tools such as a custom request for proposal (RFP) can be beneficial. A third party logistics RFP is typically used when purchasing high value and highly complex products or services. The RFP assists in this process by allowing your team to assess vendors in detail, while helping to increase the accuracy of data submitted by vendors. The process of preparing for, developing and executing an RFP can be a long one, but can be simplified if organized and executed according to plan. There are nine main steps to developing and distributing an third party logistics RFP to vendors. Here we will walk through all nine steps.

First you must assemble your internal RFP team. This team typically consists of key players in your business that can give input into operational requirements and potential future needs.

Next, your team must develop an internal timeline. Setting dates for project milestones will help keep both team members and vendors accountable for assigned activity and RFP responses. This is especially important if this project is being scheduled based on an expected implementation date.

Your team must then determine what needs must be outlined in the RFP document. Technical and operational requirements must be listed in detail for each “need” and put on a separate line item. You must be sure to use terminology such as “must” and “will” to show that these items are requirements rather than wants.

It is also important to plan for the future and have these plans reflected in the RFP as well. These items should be shown as “wanted” items. Wanted items will also appear on individual line items and must be referred contain terminology such as “can” and “optional” to assure vendors that these items are not required, but preferred.

Determining some type of scoring system or method of determining best vendors should be developed in the early stages. This will help make the decision process easier in the later stages. To create the most effective scoring system your team must determine what factors will hold the most weight: cost, functionality and services, or a combination of both.

Next, write a company overview which details your company’s background and culture. Details on how your business operates will give vendors better insight into what functionality or services they can offer your business to provide additional benefits. This information will also help vendors understand whether they can truly handle your business effectively and to your expectations.

Now you will be able to generate the actual RFP document. Your document should include: minimum requirements, how your team will evaluate and select a vendor, timeline and milestones and implementation date.

Next, select prospects to include in the RFP process. Do preliminary research using online tools and recommendations.

Now you are ready to send the RFP to vendors using your chosen method. If your company requires confidentiality, consider sending NDA’s to vendors before sending the final RFP documents.

To learn more about selecting a third party logistics provider for your business contact Wavelength Logistics experts today or visit our website www.wavelengthlogistics.com.