Frequently Asked Questions about RFPs

Q: How long does an RFP project take?

A: A full-fledged, multi-service RFP usually takes at least six months from start to final bank selection. Remember that the process of developing the questionnaire, selecting banks to receive it, reviewing the proposals, resolving issues, and making site visits must be incorporated into the treasury management staff's regular schedule, quarterly or annual closings, busy seasons, etc. In our experience, we have never yet worked with a company whose treasury staff could devote 100% of their time to an RFP until it was finished. But if you need an RFP done fast, we can reduce the time requirements drastically by taking over more of the project, involving you at key strategic points and sparing you the more time-consuming tasks.

Q: How big does a company have to be to do an RFP?

A: There really are no size limits. If you are a small company, your RFP will probably need to include all your banking services and, perhaps, a link to your credit needs. We have worked on RFPs with organizations with annual cash flows of $10 million that got competitive bidding for their business. On the other hand, a really large corporation can issue RFPs for one or two services only.

Q: How many banks should I send my RFP to?

A: The number of banks depends on several things, for example: how big your RFP is; special requirements such as local banking needs or a very high-tech need; and geographic scope. You need a minimum of two to three banks for competitive bids. For a multi-service RFP, we recommend five as an upper limit. You can have more, but you pay for it with time and with a more difficult analysis (of proposals). The dangers are that if there are too many banks, some banks will think you are not serious and will either not respond or will not give you their best proposal. The more banks, the more responses there are to read and evaluate, and you will have difficulty in distinguishing one bank from a group of many. You end up with additional phases of the project, as you eliminate a few banks at a time with different level questionnaires and analyses. This can become a real burden for the treasury staff.

Q: Must I really go through my old account analyses before I develop an RFP?

A: Yes. You need to know exactly what services you are currently using and how much you are paying for them. Reviewing old account analyses will also help you define problems in your current banking structure that you want to avoid going forward, and they are the best source for volumes to supply to your bidding group.

Q: How long should I give banks to respond to an RFP?

A: This depends on how many services are included in your RFP and the time of year. In general, we recommend giving banks a minimum of three weeks for a smaller RFP and six weeks for a longer one that spans the holiday season or the spring and fall conference seasons.

Q: We are doing an RFP and have received proposals back from the banks. Some of them have zeros in the pro forma account analysis. What does this mean?

A: It means that the bank will not charge you for this item or, more likely, did not have enough information to price the service. You must contact the bank to find out what they need (volumes, usage, etc.) so that they can put estimated fees in place of the zeros. Your goal is to have the pro forma account analysis be the best possible estimate of the bank's monthly charges. Choosing a bank based on estimates with zeros is agreeing to a service contract without knowing what it will cost you.

Q: Is it really necessary to check references? Don't the banks give you the names of people they know will say good things about them?

A: Yes, you really should check references. You'd be surprised at how candid customers are about their banks. We all put on our best face when describing ourselves and our services to others, especially to potential clients. That's the theory. Talking with customers tells you how well the theory translates into practice. If you have a large banking group, we recommend checking references for the finalists, if possible, to reduce the time requirements. Also, don't delegate all reference-checking to your consultants. You're going to want to hear what the references can tell you.