How a Scoring Process Wins More Proposals
One metric everyone in sales tracks is the conversion rate from sales calls into clients. You should also be tracking your proposal conversion rate. While tracking these metrics is critical, developing a scoring process to qualify leads can help you save time and resources.
Why scoring RFPs matters
Responding to an RFP is a time consuming process, and it’s estimated that only 5% of RFP responses result in a win. While RFPs are typically for larger contracts, it’s important to factor in the expenses from responding to RFPs that don’t win. Some companies estimate that they spend 20-40 hours on a single RFP response. This number can quickly increase if you respond to complicated RFPs or if you have many people on your team working together to perfect the response, which is often the case.
The expense of responding to RFPs means you must make sure that you spend your time and resources on opportunities that have a real chance of winning. If you treat every RFP equally, you will find that you may win some contracts that were a long shot, but you might also lose more contracts that you expected to win. This is where scoring RFPs comes into play. By scoring these opportunities before you start responding, you can determine what proposals deserve more attention in the response and commit to spending less time on the ones you aren’t likely to win (or not responding to them at all). This form of prioritization will allow you to truly develop winning strategies for your higher scoring proposals while spending less time on the RFPs that don’t score as well.
How to score RFPs
In order to successfully score RFPs, you need to first create a scoring process that you follow for every RFP. Below are the steps to create your process.
Write list of key characteristics of winning proposals
The first step to properly scoring RFPs is to understand why you have won proposals in the past. This involves having a deep understanding of your customers and who is most likely to buy your product or service. Customer personas are helpful here to have a clear idea of what motivates your ideal client to go to RFP or to buy your offering. Write out a list of all of these factors as a starting point to creating your scoring criteria.
Developing scoring scale
Once you have a list of your key winning characteristics, it’s time to determine the scale you want to use for scoring RFP opportunities. For example, will you scale from 1-10, 1-100, 1-1000 or something in between? Here you will also need to categorize “go”, “go depending on resources”, and “no go” scores. For example, on a scale of 1-10, if an RFP scores a 2, then you likely won’t respond to it because there is a very small chance of you winning based on the common factors that make you successful. On the other hand, if the RFP scores an 8, then you know that you should spend a lot of time crafting a strategy and telling a compelling story because there’s a high likelihood that you can win it.
Create key scoring factors
Now that you have your common winning characteristics and a scale, it’s time to create the factors that you will use to score RFPs. If there are common themes in your winning characteristics, then you can combine those into a scoring factor that you might use.
Below are some more examples of scoring factors to help get you started.
Company size
Revenue potential
Long-term relationship potential
Lifetime value potential
Scope of work
Key tips for creating your scoring factors
Price
One major evaluation factor for all RFPs is price. Using your customer personas, consider what their budget might be for a specific type of project. For example, if you offer technology services starting at $100,000 and you estimate that 10% of their $5 million revenue is allocated to technology, then their budget is $500,000, and your price would use up 20% of that budget. Some companies might be okay with that because they don’t have many internal technology costs, but this might be a red flag for others. Use this framework to determine who can afford your services and eliminate anyone who can’t.
Internal Resources
Similarly, you’ll need to determine how much you can spend responding to a proposal in order to make it worth it. If you distract resources from other high-value work in order to respond to RFPs that you aren’t likely to win, then you’re wasting time that could be better spent elsewhere. On the other hand, if you are very likely to win, and it’s a high-value contract, you know it’s worth the time and effort to respond.
RFP Scoring Matrix Template
If you need help creating your scoring framework, download this free template! Click below to download a template to use for proposal scoring.
Analyzing scoring metrics
Once you have created your scoring factors, it’s time to start scoring your proposals! Here’s an example scoring matrix if you need more inspiration.
If you’re a little confused on how to actually do this, let’s dive in. In the matrix image above, you would go through and assign a score for each of the 5 factors. Let’s walk through each with a pretend RFP and company.
Company Size
For our pretend RFP, assume that the company is earning about $15 million in revenue per year.
Score: 1
Urgency
They need this project to be completed before their major annual event in 6 months.
Score: 2
Solution Fit
This project is for an area where we’re trying to expand our business. We’ve had a few projects already to use as references.
Score: 1
Income Potential
To complete this project, we estimate it will cost around $350,000. It is a one-time project.
Score: 1
Relationship
We have no relationship with this company and found the RFP through a public site.
Score: 0
Total score: 5
This one scores a 5 in our process, which means it probably falls into the “go only if resources are available” category. If we scored higher in a few areas, it would be a definite go. You can start to see in this example how it helps to provide a more objective approach to determining if you should use resources to respond to an RFP.
Next Steps
Now that you can score your proposals, it’s time to stop responding to RFPs where you aren’t likely to win and instead focus your efforts on those that more closely align with your business.