For most organizations, responding to a Request for Proposal (RFP) is usually an arduous process that crops up unexpectedly—and comes with tight timelines.
Because of these factors, many companies don’t put improving RFP management high on their priority list. Plus, finding comparison data for gauging process performance can be difficult.
That’s why Loopio decided to put this oft-overlooked process under the microscope. We surveyed 500 individuals involved in responding to RFPs, and we turned our findings into the RFP Management Benchmarking and Trends Report.
We discovered that RFPs (and the people handling them!) can have a BIG impact on top-line revenue—if the right processes, people, and tools are in place.
This comprehensive report dives into the traits top performers have in common, as well as benchmarks for gauging success and process efficiency. It also includes an analysis of the key challenges organizations face when it comes to improving their responses and provides an outlook on investments and trends for 2020.
Download the whole report (it’s free!) to find out how your process compares to others.
Here are some of the most interesting findings from the report:
1. RFPs are a significant contributor to new and retained sales revenue.
RFPs accounted for 41% of sales revenue. This RFP revenue was almost equally sourced from new business and retained business.
The average RFP win rate was also found to be 53%—which is a much better win rate than lots of other marketing and sales channels. This makes RFPs a potentially bigger opportunity for revenue growth than some companies may believe.
2. Access to internal information causes the most headaches in the RFP process.
The biggest challenges reported when it comes to responding to RFPs were:
- Finding accurate answers quickly (44%)
- Collaborating with internal subject matter experts (43%)
- Choosing the best answers from a pool of potential answers (36%)
- Meeting deadlines or dealing with delays (35%)
If organizations want to improve their process, finding better ways to collaborate and share RFP content will have the most impact.
3. Executives and Associates have vastly different understandings of the RFP process.
Executives and Associates are often not aligned on RFP process metrics or satisfaction levels.
For example, 40% of Executives are ‘Very Satisfied’ with the time it takes to complete an RFP, while only 12% of Associates are. 80% of Executives feel ‘Very Satisfied’ with the quality of their RFPs, while only 16% of Associates feel this way.
Executives are 10% more likely than average to say their team responds to all of the RFPs they receive, and report higher than average win rates. This means that they may have access to data that lower-level employees don’t—or that their view of the process is skewed since they are far removed from it.
So, what’s the solution? More accurate reporting and metrics tracking could help bridge the gap between these two groups, which brings us to interesting finding #4...
4. Most companies aren’t tracking some key RFP metrics.
Nearly half (46%) of all respondents are tracking high level revenue sourced from RFPs. But only a third (or less) track other important metrics, like number of submissions made, time spent creating RFPs, or team/employee performance or sentiment—all of which were tied to more positive RFP process outcomes, like higher win rates and response quality.
If companies don’t track or report on these more granular metrics, they won’t truly know which levers they can pull to improve their RFP revenue.
5. Those using dedicated RFP software see more success.
80% of survey respondents use RFP response software.
RFP platform users tended to:
- Submit nearly 50 more RFPs annually than those without software.
- Rate their tools as more effective than average
- Involve more collaborators in the RFP process
Since submitting more RFPs, having effective tools, and involving more people in the RFP process were correlated with higher win rates, it’s in every company’s best interest to assess if an RFP response software could improve their performance.
6. Longer processes that involve more people see better win rates.
The average time spent writing a single RFP is 23.8 hours. The average submission timeline—from the day an RFP is received to the day it is approved and submitted—is 10.5 days. Interestingly, those with longer timelines were more likely to report higher win rates. This means having a faster process doesn’t always indicate that the RFP process is better or that it will result in more positive outcomes.
The average number of people involved in completing a single RFP response was 7.3. While one may think that involving more people in the process would make it more laborious or convoluted, it appears that the opposite is true: those who had more team members contributing to RFPs reported better win rates. Plus, those who felt their process was less efficient than others were also 29% more likely to involve fewer than five people in the response process—meaning a lack of internal support from other team members likely causes roadblocks in the response process.
7. In 2020, RFP numbers and resources are going to grow for most.
Next year, a whopping 63% of companies plan to submit more RFPs than they did this past year. Many are also planning to invest more resources into their RFP process.
The top investment areas are:
- Hiring more staff
- Investing in new tools
- Acquiring more training for current employees
Interestingly, the suggested areas for improvement changed depending on the respondent’s job function. For example, Proposal Managers were more likely to suggest hiring as the best way for their organization to improve their RFP process, while those in other areas, like Sales and Marketing, thought tools would drive the biggest value.
Who We Surveyed
The report surveyed 500 individuals who were involved in the RFP process from companies across North America. Organizations ranged in size from less than 100 people to 10,000+ employees and covered 14+ industries.
We surveyed also surveyed a range of titles, from Proposal Managers and Sales team members, to Executives and Information Security professionals, so that a holistic analysis of the RFP process could be conducted.
Download the report now for more details on how industry and company size impacts the overall benchmarks.