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Sarah has worked as a procurement officer at her college for the past eight years, and she was still at her desk past 7 o’clock—again. She sighed as she looked at the stack of papers on her desk and scanned the details of the Request for Proposal (RFP) she was putting together for new lab equipment. As she rubbed her eyes, Sarah kept thinking, “There’s got to be a better way.”
The job of a higher education procurement professional today is challenging. From ensuring compliance with state and federal regulations to stretching limited budgets to mitigate rising prices, procurement officers like Sarah are constantly juggling multiple responsibilities. They must balance the needs of various departments, navigate complex supplier relationships, and strive for transparency in all their dealings—amid increasing pressure to reduce costs without sacrificing quality.
In this guide, we will explore the world of RFP contracts in higher education procurement. We will examine the entire RFP process, discuss the pros and cons, and explain how to use group purchasing organizations (GPOs) to make Sarah’s life—and yours—a whole lot easier.
Let’s start this section by answering the question, what are the phases of the RFP process?
This section provides an overview of your institution and the need that the RFP aims to address. It sets the context for potential suppliers and helps them understand your organization’s goals.
Here, you’ll detail exactly what products or services you’re seeking. This section should be as specific as possible to ensure that suppliers can accurately assess whether they can meet your needs.
This part outlines what you expect to see in the suppliers’ proposals. It might include formatting guidelines, required documentation, and questions you want answered.
Transparency is key in procurement. This section should clearly state how proposals will be evaluated and what factors will be considered in the decision-making.
Finally, this section covers the legal and contractual aspects of the potential agreement, including payment terms, delivery expectations, and any other relevant conditions.
While these five sections look simple, the details can get quite complex. Procurement teams must provide clear and detailed descriptions of goals and objectives along with any requirements for meeting college or university guidelines.
RFPs are a standard tool in procurement, but it is important to recognize their true cost. Many procurement officers have been following their school’s RFP contract process for so long they do not stop to consider the resources it takes to execute one.
Creating a comprehensive RFP is time-consuming. From drafting the document to reviewing proposals and negotiating with suppliers, the process can take months. This is time that could be spent on other critical tasks.
RFP contracts require input from multiple stakeholders across your institution. This means pulling staff away from their regular duties to contribute to the process.
Comparing multiple proposals objectively can be challenging, especially when dealing with complex products or services. The evaluation process often requires specialized knowledge and careful consideration.
Ensuring that your RFP and the resulting contract comply with all relevant regulations adds another layer of complexity and potential cost.
When you add them up, the hidden costs can be quite high, especially when you break down each step of the process in an RFP contract checklist.
To manage the complexity of the RFP process, many procurement officers use an RFP checklist to make sure nothing is overlooked. While your checklist may be different, here is a sample of a typical checklist:
While this checklist can help streamline the process, it illustrates the steps involved in executing an RFP. They all take time and resources, contributing to the total cost of the RFP process.
What does a good RFP look like? Here are a few recent proposals from several higher education institutions, which you can view:
While any school can issue an RFP, there are other options for higher education procurement. Group purchasing organizations (GPOs) can act as an extension of your procurement office to reduce complexity, streamline processes, and save money.
For Sarah, the option of using a GPO or sourcing cooperative might mean fewer late nights and a more efficient way to handle procurement for certain goods or services. If you think about all of the checklist items, you can see how supplementing your RFP contract process with GPOs can significantly reduce the workload.
By leveraging pre-negotiated contracts, GPOs eliminate the need for individual institutions to go through the time-consuming RFP process. This frees up procurement officers to focus on strategic initiatives rather than getting bogged down in contract details.
GPOs aggregate the purchasing power of their members, allowing them to negotiate better prices than a single college or university could achieve on its own. This collective approach often results in significant cost savings.
Procurement teams at GPOs specialize in procurement and have in-depth knowledge of various markets. Category experts stay on top of industry trends, pricing fluctuations, and new product offerings—providing valuable insights to member institutions.
Because suppliers are thoroughly vetted before being awarded a contract, academic institutions can save a lot of time and effort in researching and evaluating multiple suppliers.
GPOs ensure their contracts comply with relevant regulations, reducing legal risks for members. They also often have stronger leverage to enforce contract terms and resolve disputes.
A significant advantage of GPOs is the ease of use they offer. Instead of spending months on an RFP process, procurement officers can quickly access pre-negotiated contracts that align with their institution’s needs.
When a need arises, procurement officers can immediately tap into a pool of pre-approved suppliers. This speed can be crucial in addressing urgent requirements or taking advantage of time-sensitive opportunities.
Despite the benefits of GPO contracts, there are situations where RFPs are the best approach, for example, when institutions have very specific needs or unique requirements that a GPO contract does not address.
Some funding sources may require a specific procedure, including a formal RFP process. In other cases, regulatory requirements or internal policies may dictate a particular procurement approach.
We have put together this chart, which gives you an idea of when it makes sense to consider GPO contracts vs. RFP contracts. You can use this as a general guideline, but each procurement team will need to make its own decision about what works best for their college or university.
Scenario | RFP | GPO |
Unique or highly specialized needs | ✓ |
|
Standard, commonly purchased goods/services |
| ✓ |
Need for immediate or emergency procurement |
| ✓ |
Limited internal procurement resources |
| ✓ |
Complex, multi-year projects spanning multiple suppliers | ✓ |
|
Regulatory requirements mandate competitive bidding | ✓ |
|
Seeking innovative solutions to localized problems | ✓ |
|
Bulk purchases of common items |
| ✓ |
Need for ongoing contract management |
| ✓ |
Desire to leverage collective buying power |
| ✓ |
Seeking a strategic, long-term partnership | ✓ |
|
Need for extensive customization | ✓ |
|
Limited market knowledge of suppliers and pricing |
| ✓ |
Emphasis on cost savings |
| ✓ |
Need for flexibility in contract terms | ✓ |
|
Focus on time and resource efficiency |
| ✓ |
Requirement for extensive supplier vetting | ✓ |
|
Need for quick access to pre-vetted suppliers |
| ✓ |
Need for specialized legal/compliance support |
| ✓ |
Whether you use RFPs, GPOs, or a combination, following a few best practices consistently can deliver the best results.
Align your procurement activities with your institution’s overall strategic goals. This might involve prioritizing sustainability, supporting local businesses, or focusing on long-term cost reduction.
Implement digital process and eProcurement systems to streamline processes, improve visibility, and enhance data analysis capabilities.
Using data analytics provides a comprehensive view of institutional spending patterns and can help identify:
Work closely with departmental stakeholders to understand their needs and ensure that procurement decisions align with academic and operational requirements.
Whether working through a GPO or direct relationships, focus on building strong, collaborative relationships with key suppliers. This can lead to more innovative solutions.
Regularly review and refine your procurement processes. Seek feedback from stakeholders and suppliers, and be open to adopting new approaches and technologies.
While RFP contracts still have their place, particularly for unique or highly complex needs, GPOs are increasingly becoming the go-to solution for many higher education institutions. As you evaluate your procurement strategies, consider how a GPO might complement your current RFP processes. The potential for increased efficiency, cost savings, and strategic focus can transform your procurement operations, allowing you to better serve your institution’s needs.
By leveraging the right tools and strategies, you can play a pivotal role in driving your institution forward and, like Sarah, take a few more nights off.
What is the difference between an RFP and an RFQ?
An RFP (Request for Proposal) is used when you have a complex need and are looking for suppliers to propose solutions. An RFQ (Request for Quote) is simpler and is used when you know exactly what you need and just want pricing information.
How can I determine if a GPO is right for my institution?
Consider factors such as the types of goods and services you frequently purchase, the potential for cost savings, the time and resources you currently devote to RFPs, and the GPO’s experience in higher education. Some GPOs offer free spending assessments to help you understand the potential benefits for specific needs.
Are there any downsides to using a GPO?
While GPOs offer many benefits, potential downsides could include less control over the supplier selection process, possible limitations in product or service options, and the need to adapt to the GPO’s processes. However, many institutions find that the benefits far outweigh these potential drawbacks.
Can I use both RFPs and GPOs in my procurement strategy?
Yes, many colleges and universities use a hybrid approach, leveraging both GPOs and RFPs. This balanced approach can maximize efficiency while maintaining flexibility.
E&I Cooperative Services is the only member-owned, non-profit GPO that exclusively serves the education sector. With competitively solicited cooperative contracts, you can leverage the aggregated buying power of 6,000 academic institutions to achieve significant volume discounts and streamline your procurement.
Contact E&I Cooperative Services today or view available contracts online.
