Exploring Request for Quotation

A Request for Quotation (RFQ) is a formal document issued by a buyer to potential suppliers, inviting them to provide pricing and terms for specific goods or services. It’s a key step in procurement, helping organizations compare offers and select the most suitable supplier based on price, quality, delivery time, and other criteria.

• Purpose: Obtain competitive bids from multiple suppliers for a defined list of products or services.
• Structure: Includes item descriptions, quantities, specifications, delivery requirements, payment terms, and submission deadlines.
• Comparison basis: Focuses mainly on pricing, but may also evaluate suppliers on quality, service levels, and compliance.
• Outcome: Leads to awarding a purchase order or contract once the buyer selects the winning supplier(s).

• Encourages competitive pricing.
• Ensures transparency and fairness in supplier selection.
• Helps buyers standardize offers for easy comparison.
• Strengthens supplier relationships by clearly communicating requirements.
• Supports cost savings and better negotiation outcomes.

Buyers using SAP ERP or SAP S/4HANA (on-premise) can source items using two options:

1. Create an RFQ in the SAP system and send a QuoteRequest cXML document to SAP Ariba Strategic Sourcing via SAP Business Network.
2. Create an RFQ event originating in the SAP ERP system and send it to SAP Business Network, where an RFQ event is created and published on SAP Business Network Discovery.

SAP System users can create an RFQ with material or service line items by:

• Creating a new Request for Quotation
• Creating a Request for Quotation against a Purchase Requisition
• Creating a Request for Quotation against a Contract (Outline Agreement)

By default, SAP Business Network routes the RFQ to SAP Ariba Strategic Sourcing. To send it to SAP Business Network Discovery, enable the Quote Automation feature on SAP Business Network via a Service Request. This feature prevents RFQs from being sent to SAP Ariba Strategic Sourcing.

• New and Change RFQs support attachments at the header and line item levels.
• Users must configure the Document Management System (DMS) on the SAP System to add attachments to RFQs.
• Attachment sizes for inbound and outbound documents cannot exceed 100 MB, with a payload of up to 40 MB.
• SAP Business Network doesn’t decrypt encrypted or password-protected files for suppliers to view.
• Modifying or deleting a line item-level attachment requires updating the line item text. Changes to the attachment aren't updated in SAP Ariba Strategic Sourcing otherwise.
• Text descriptions at the header and line item levels are supported for internal and external users.
• If an RFQ is created against a Purchase Requisition, the text descriptions for internal and external users in the Purchase Requisition appear in the RFQ.
• Target Value and its currency in the RFQ header are supported.
• The Target Value field in the SAP system is mapped with the Baseline Spend field of the Sourcing request on SAP Ariba Strategic Sourcing.
• Users can add one or multiple service items in an RFQ created in the SAP system. Service RFQs can include:
• • Service item (category D) with up to five-level hierarchy (one parent item and four child items)
  • One or more service specifications
  • Service outlines with up to four-level hierarchies
• After approval in SAP Ariba Strategic Sourcing, no changes can be made.