Request for Quotation Letter
Asks suppliers to quote against a specification.
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Dear Sir / Madam,
We invite your quotation for the following: [what you need quoted]
Please quote unit prices exclusive of tax, together with lead time, minimum order quantity and payment terms. Our standard terms are [your terms].
Quotations should reach us by [date] and remain valid for thirty days. We are not obliged to accept the lowest or any quotation.
What is a Request for Quotation Letter?
A request for quotation is the letter that asks named suppliers to price a defined requirement on defined terms, so the quotes that come back can be compared side by side. It matters because the quality of the answers is set by the question. Send a loose description and you get three quotes covering three different scopes, which tells you nothing about who is cheapest.
Buyers, office managers, facilities teams, project engineers and anyone running a one-off purchase above the threshold where a single phone call stops being defensible. It suits requirements you can specify precisely — 40 desks to a stated size and finish, six months of monthly boiler servicing, machining of a part to a drawing. Where the requirement is a problem rather than a product, and you want suppliers to propose a solution, a request for proposal is the right instrument instead, because the answers will not be comparable on price alone.
If you are spending public or grant money, the process is not yours to design. Thresholds decide whether you may seek three quotes or must advertise a tender, and they differ: EU and UK public procurement rules set financial thresholds and advertising duties, Indian government buyers work within GFR and GeM procedures, US federal grantees follow uniform guidance procurement standards, and Australian and Canadian public bodies have their own frameworks. Charities and companies spending donor money often have contractual obligations too. Confirm the threshold and the required route before you send anything.
An RFQ is an invitation to offer, not an offer itself. The supplier's quotation is the offer, and it becomes a contract when you accept it — usually by issuing a purchase order. That order matters, because the terms attached to the quotation and the terms attached to your order can conflict, and which set governs is a legal question that has been litigated for decades. The RFQ also does not commit you to buy anything, and should say so; but it does create an expectation of fair treatment, and suppliers who suspect a stitched-up process stop quoting.
What to put in a Request for Quotation Letter
These are the details this template asks for. Anything left blank is marked in red on the preview so you can see what is still missing.
| Field | What goes in it |
|---|---|
| Business name | For example: Barton Supply Co. |
| Your address | For example: Unit 7, Barton Road, Columbus, OH 43212 |
| Supplier | For example: Northgate Timber Inc. |
| Supplier address | For example: Unit 3, Foster Avenue, Cleveland, OH 44113 |
| What you need quoted | For example: Oak veneer panels 2400x1200, grade A, quantity 240 per month for twelve months. |
| Quotations due by | Free text |
| Your standard terms | For example: 30 days from invoice, delivered to site |
| Issued to (full name) | For example: James Whitfield |
| Their address | For example: 588 Kinnear Road, Columbus, OH 43212 |
How to write a Request for Quotation Letter
Specify the requirement so nobody guesses
Give quantity, specification, standard, drawing number or model, and any acceptable equivalent. Where you will accept an alternative, say what makes one acceptable. Attach the drawing rather than describing it. If the requirement includes installation, disposal of the old unit or out-of-hours access, put that in the specification — it is the part suppliers price differently and quietly.
State delivery point, date and quantity split
Name the delivery address, the required date or schedule, and whether you want it in one drop or called off over time. Say what access is like if it matters — no loading bay, third floor, no lift. Suppliers price transport into the quote, and a delivery condition discovered on the day becomes an extra charge you did not agree.
Say how quotes will be compared
Tell suppliers the basis: lowest compliant price, or price weighted against lead time and support. Ask for prices in a single stated currency and on a stated delivery basis or Incoterm, with tax shown separately, and ask for the price to be broken into the same lines for everyone. Comparison is impossible when one quote is delivered and inclusive and another is ex works and plus tax.
Set a deadline and a single contact
Give a date and time for responses, the format you want them in, and one named person for questions. Say that questions and answers will be shared with all invited suppliers, and then do it — that is what keeps the process fair and stops one supplier building an advantage out of a phone call. Say how long you need the quote held open.
Attach your terms and say what happens next
State the payment terms, warranty expectations and any conditions that will apply, and ask suppliers to flag exceptions in their quote rather than burying them in their own conditions. Then set out the next steps and rough timetable: evaluation, possible clarification questions, award by purchase order. Add a line confirming you are not bound to accept any quotation.
Common mistakes
- Describing the requirement loosely, so three quotes cover three different scopes and the cheapest is simply the one that left the most out.
- Failing to state whether prices should include delivery and tax, which produces figures that cannot be compared without a round of phone calls.
- Answering one supplier's clarification privately, which gives them an advantage and undermines the fairness of the whole exercise.
- Omitting a response deadline, so quotes trickle in over weeks and the earliest ones have expired before you decide.
- Treating the winning quotation as the contract without issuing a purchase order, leaving the supplier's own conditions as the only written terms.
Frequently asked questions
What is the difference between an RFQ and an RFP?
An RFQ prices a requirement you have already specified, so the answers differ mainly on price, lead time and terms. An RFP asks suppliers how they would meet a need, so the answers differ in approach and have to be evaluated on method as well as cost. If you find yourself writing an RFQ with a blank where the solution should be, you want an RFP.
How many suppliers should I send an RFQ to?
Three is the common working minimum for private buyers, enough to show the price is tested without wasting supplier time. Public and grant-funded buyers do not have a free choice — the number and the route are set by the applicable procurement rules and thresholds, so check those first. Inviting a supplier you have no intention of using is a poor habit that damages relationships.
Is a quotation legally binding on the supplier?
A quotation is normally an offer, capable of acceptance for as long as it stays open, which is why validity periods matter. It is not binding on you until you accept it. What complicates this is the clash between the supplier's conditions and yours; whose terms govern depends on the sequence and wording of the documents. Take advice where the value or risk is significant.
How long should I give suppliers to respond to an RFQ?
Long enough for them to price properly — a week or two for a straightforward supply, longer where they must price sub-suppliers, site visits or drawings. A deadline so short that only the incumbent can meet it produces exactly one usable quote. If you extend the deadline, extend it for everyone and tell them all in the same message.
Should I tell suppliers who else is quoting?
Normally no. Naming competitors changes behaviour, and disclosing another supplier's pricing is a serious breach that can expose you to competition law risk in several jurisdictions. It is fine to say how many suppliers were invited and to publish the process. After award, telling unsuccessful bidders where they placed and why is good practice, without revealing another firm's figures.
This page explains general practice and is not legal advice. Requirements differ between countries and, in some cases, between states — check what applies where the document will be used.