Jun 27 2008 9:31AM | Permalink | Email this | Comments (1) |
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Earlier this week I had the opportunity to have a discussion with several non-competing manufacturers who were attending the Pacific Coast Builders’ Conference in San Francisco. As you can imagine, the topics were varied and the content was quite interesting as many different view points were expressed, that is, until the subject of Request for Proposal (RFP) came up. On this subject the manufacturers were all on the same page.

Let me explain. Several years ago most public builders initiated the R.F.P. process with major building material manufacturers. Legend has it that industry consultants assisted the builders in developing this process which has been used in other industries and government for some time. The manufacturers are requested to fill out forms addressing the following subjects:

• Price
• Base Rebate
• Conversion Incentive
• Model Home Program
• Design Center Program
• Co-op Advertising Program
• Marketing Incentive
• Employee Purchase Program
• Cost Reduction Incentives
• Manufacturing Capacity
• Warranty
• Distribution Details
• Company-owned Installers
• Customer Service Program
• Account Management Contacts
• Technical Support
• Quality Assurance Manual
• Technology Advantages
• Reporting Process
• Product Lines
• Division Implementation Plan.

The manufacturers felt that this was a big waste of time as it always boiled down to price and rebates. In addition, the builders never give the manufacturers enough time to fill out the R.F.P. form. As I listened to this discussion I couldn’t believe how much the manufacturer had to sacrifice in terms of price, rebates, conversion allowances and other cost items to win business with these large builders. My other thought was how this process just adds useless energy to an already inefficient supply chain.