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Creating a Supply Chain Request for Proposal, Part 2

A Supply Chain Request for Proposal (RFP) contains information about the Company and information that you want to know about the potential providers. We continue our discussion of the provider information solicitation within the RFP.

A well-crafted RFP should also solicit information regarding support and control processes which are critical to controlling cost and delivering superior customer service for the Company’s customers.

·       Inventory management

Have the provider explain their processes for controlling the Company’s inventory including daily transaction execution, standard cycle counting procedures, and accuracy levels performance. Evaluate the inventory management response carefully as precise inventory control is critical for delivering superior customer service.

·       Quality processes and certifications

Have the provider specify any ISO or other quality certified operations, their typical quality processes, security procedures to protect assets, CT-PAT process compliance (if applicable), global trade management compliance procedures (if applicable), and quality audits planned for the operation.  Inform the providers if you plan to conduct unannounced process control or facility audits.

·       Customer service policy and structure

The provider should describe the customer service and office support functions including manager and supervisor resumes, and conflict resolution authority. Assess the description for compliance, responsiveness, and control.

·       Performance measurement and reporting

Specify the standard performance measures you monitor. Ask how the providers have previously monitored, captured, and reported this information as well as the performance levels they have attained for other customers. Include metrics such as operations: volume, cost, and productivity; service: order accuracy, on time shipping, and OS&D (over, short, and damaged); inventory; safety; and quality performance.

·       Continuous Improvement and Cost Reduction

The Company should plan to work with the provider to improve productivity and operational efficiency.  Have the provider describe their experience and expectations with continuous improvement and how they propose to drive and share overall cost and efficiency improvements with the Company.

·       Implementation process, team and timing

Providers should describe the proposed project plan and other implementation activities required to convert to the proposed service.  Require the providers to structure a project plan that demonstrates that their project approach can achieve your objectives while also describing the interrelations of those activities necessary to implement the proposed plan.  Providers should submit a conversion plan to migrate both the information/technology and the operation from the existing state to the new 3PL service environment. Use the implementation plan to assess the providers’ skills and capabilities to achieve a transition that is both timely and seamless to the customers.

The objective of the Supply Chain Request for Proposal is to both communicate to potential partners what is required and determine how they will service the account and your customers. Seek first to identify the best partner that has cultural and strategic alignment, meets the operational requirements, and that you can work with effectively to meet the on-going operational challenges that will occur during the term of the agreement.

Read our first post… Part 1 Supply Chain RFP

Part 3 Supply Chain RPF Evaluation Steps


Published in February 2016

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