How to Stop Leaving RFP Revenue On The Table
Although they’re often overlooked, Request for Proposals (RFPs) are a significant driver of top-line revenue. Loopio’s recent study of 500 companies found that RFPs account for 41% of overall sales revenue.
The research also found that the average win rate for RFPs is 53%—a significantly higher conversion rate than many other traditional sales and marketing channels.
If RFPs aren’t an important source of sales revenue for your organization, your team may still have to grapple with them in the sales process: the report found that 63% of companies are expecting to respond to more RFPs in 2020 than they did last year. Most organizations also plan to invest additional resources into their RFP process, including headcount and new tools.
In this post, I’ll share which industries are most successful with RFPs, how top-performing teams win more bids and strategies you can use to stay on top of this trend.
RFPs Success by Industry and Company Size
Loopio’s report surveyed participants across 14 industries, such as advertising, healthcare and financial services.
On average, nonprofit/government, insurance and hardware industries respond to the most RFPs annually. However, industries that have the highest RFP win rates are advertising (63%), legal services (60%) and insurance (56%). Those in software win the smallest percentage (39%)—making competition in this field fierce.
Enterprise organizations are more likely than smaller companies to generate a higher percentage of sales revenue from RFPs.
To improve performance in the coming year, companies with these profiles should take a deeper look at how they compare with industry standards, and put metrics in place to track success.
How Top Performers Win More Bids
Factors that were correlated with higher RFP win rates include:
- Involving more collaborators in the response process
- Investing more time in responding to RFPs
- Having a team or individual dedicated to owning all RFP projects
Another significant contributor is the use of RFP software. Those with dedicated response platforms submit nearly 50 more RFPs annually than those without software. They’re also more likely to rate their tools as highly effective, and involve more collaborators in the RFP process.
Looking Ahead to 2020
When asked how their company could improve the RFP process, those who work in sales, solutions engineering and information security feel that finding a way to better manage, search and maintain their RFP content is the most imperative action.
To improve the response process and win rates, sales leaders should also consider doing the following:
- Designate a team lead to handle RFP intake and content management.
- Conduct an internal survey to understand the biggest challenges your teams currently face in the RFP process.
- Track the number of RFPs or Requests for Information (RFIs) that are being submitted so you can adjust resources accordingly next year.
Reach out to me to learn more about the most common RFP management obstacles companies experience—and to pick up tips for overcoming them.