As businesses grow and become more complex, they must monitor their operations more closely to keep everything running smoothly and cost-effectively. That requires growing volumes of accurate data on the intricate web of people, processes, technologies and partners that make up the organization, which is why many companies choose to implement an enterprise resource planning (ERP) solution. But choosing to implement an ERP raises a new challenge: how to find, evaluate and implement the ERP solution that best meets your organization’s unique needs. Issuing a request for proposal (RFP) is the most common approach among large enterprises — and is easily within the reach of any midsize business, too.

A good RFP clearly articulates a company’s ERP implementation requirements for a short list of ERP vendors invited to respond with proposals describing how their solutions and experience directly address the company’s needs. While the process sounds straightforward, in practice it requires careful consideration and planning. This article explores the importance of RFPs in finding the right ERP solution for your business and includes tips on how to develop a clear and complete RFP, the mistakes to avoid, and a template to help you develop an RFP for ERP that ticks every box.

What Is an RFP?

A request for proposal, or RFP, is a document that describes a business’s ambitions for a new project and invites a selection of qualified vendors to bid for the work. RFPs generally include background information about the organization, a detailed description of its needs and expectations, a discussion of how it currently meets the needs described, evaluation criteria for vendors and, of course, a deadline for submissions.

When a company decides to buy an ERP system, the RFP might provide descriptions of why it requires ERP software, how it plans to use the solution in both the short and long term — including the business processes it plans to instrument/automate — and any unique performance needs specific to its way of working or the industry in which it operates. For example, a financial services institution needs to comply with strict data governance regulation in its back-office operations, while a global retail operation might be more focused on gaining a holistic view of its supply chain, inventory and logistics operations.

In many cases, businesses send out an RFP as a follow-up to an RFI, or request for information. An RFI is an open invitation for vendors to share information about their top-line products and services, industry experience, awards, corporate values and other qualifiers. Evaluating RFI submissions can help you identify the short list of preferred vendors that’ll receive your RFP.

Key Takeaways

  • An RFP is a document outlining your business’s ERP implementation requirements so vendors can propose their best possible ERP solution and delivery model to meet those needs. 
  • Many businesses choose to develop RFPs for their ERP solutions using a proven RFP template. 
  • The best ERP vendors will provide a solution that can grow and evolve with your business’s evolving needs and will craft an RFP response that displays a clear understanding of your ERP goals today and into the future.

RFP for ERP Explained

ERP software helps companies unify mission-critical operations like sales, finance, procurement and manufacturing around a single, common database so they can work faster and more accurately, which in turn leads to improved sales and more efficient management. It can be especially valuable for fast-growing businesses and those operating in multiple geographies. For companies seeking an ERP solution, developing and sending an RFP to a short list of vendors is one of the most helpful and practical ways to find the right solution for your needs.

What’s more, the act of thinking through and writing down the details of an RFP forces a business team to break down its ERP implementation requirements in a systematic way, resulting in a clearer articulation of the business’s challenges and needed solutions, and more detailed criteria against which to rank vendor offerings. All of this contributes to the end goal of the RFP process, which is to find an ERP vendor that delivers the right technology, in the right package of configuration, training and support, and at the right price.

It’s worth noting that the shift to cloud-based software-as-a-service has made ERP solutions more widely accessible and has changed the way companies account for their return on investment in RFP evaluations. First, cloud-based ERP solutions are more accessible because they can be used by companies without large, expert, in-house IT staffs, since they’re renting use of the software from experts that deploy and maintain it. And, whereas traditional on-premises ERP systems required a large up-front capital expenditure followed by regular upgrades and customization over the years, cloud-based solutions incur a monthly licensing fee, which appears as an operating expense on a business’s financial statements. This is advantageous, particularly for small and medium-sized organizations that may not have the capital budget to cover enterprise-grade ERP infrastructure. It also allows businesses to scale their ERP operations quickly without investing in heavy infrastructure or new hires.

Do You Need an RFP for an ERP System?

While RFPs are useful tools for companies that want to find and implement the best possible ERP software for their needs, there’s obviously no law requiring that businesses use them. Many small and midsize organizations don’t, primarily because RFPs add time and cost to any purchase process. Instead, many opt for a less formal process of sharing a list of system requirements and inviting ERP vendors to make pitches and/or demonstrations against that list.

But, on the flip side, RFPs need not be massive tomes, and templates are available to accelerate their development and help keep them concise. Plus, while there is a great deal of information available publicly about different ERP solutions, from website reviews to IT market research analyst reports, there is no substitute for a tailor-made RFP response that speaks directly to your business’s goals.

RFP for ERP Template Sections

When drafting an RFP for an ERP implementation, there is a fine balance to strike among clarity, conciseness and completeness. If your list of requirements is too vague, vendors may not provide enough detail in their responses. Worse, the implementation will not address your business’s needs because those needs were never clear to begin with. But if the RFP is too long or includes information that isn’t directly relevant, it likewise can cause vendors to return poor responses.

Clearly, the quality of an RFP dictates a large measure of the quality and relevance of the responses. Good RFPs should include a list of project requirements and desired ERP features, as well as a discussion of how you envision the solution helping the business achieve its broader strategic goals. With so many elements to consider, companies often develop RFPs using a template that helps them cover all the bases and provide all the necessary information. ERP templates also speed up the RFP development process, as businesses don’t need to consider the structure of their responses and can instead focus on gathering pertinent content.

The template for ERP RFPs available for download from this article includes the following sections: 

Background Information

To paint a clear picture of the organization vendors are pitching to and why, provide concise but complete background information about the business, its operations, the markets and industries it serves, and its organizational culture. The “why” of an ERP implementation often dictates which solution and consumption model — on-premises or cloud-based — is best. For example, a growth-oriented manufacturer or retailer will be more focused on agility than a government institution that must prioritize clear paper trails and the highest levels of data governance.

Project Scope

Provide details about the scope of the work, beginning with why your business is implementing an ERP, which departments (and how many system users) will be involved across the organization, what objectives you hope to achieve as an organization and the responsibilities you expect your primary — and any secondary — vendors to provide. The project scope should also specify any custom ERP features your company requires to meet specific needs, and whether the ERP system must integrate with any existing IT systems. Another point to include in the project scope is change management — organizations typically underestimate the challenge of getting employees to change old habits. ERP implementations usually bring change for the better, but they can be successful only when employees adopt the solution. It’s common for businesses to lean on their ERP vendors for basic training, but it’s a good idea to ask for their change management guidance, too.

Requirements List

Your requirements list is the meat of the RFP document. It must be complete, accurate and specific. Start by singling out the business processes you are looking to improve and breaking down where they fall short relative to the business’s near- and long-term goals. From there, develop a list of ERP requirements that directly addresses those gaps. The requirements list should include technical metrics for your ERP software, like speed, performance and scalability, as well as a detailed list of the features and capabilities your teams need. To ensure completeness — and to begin the change management process early — make sure to invite stakeholders from every department that will use the new ERP system to weigh in on these requirements. ERP software was once the domain of finance, manufacturing and supply chain teams but is now just as relevant across the organization, from HR to marketing to sales.

The ‘3Ps’ of Purchasing Success

When selecting your ERP, modules matter. So do the 3 Ps — talk to the people who’ll use it, consider your processes, and set SMART priorities.
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supply chain management erp

Vendor Qualifications

The purpose here is to assess whether a vendor has the experience, skills and confidence to successfully complete your ERP project. A key question: What other ERP systems has the vendor implemented for other companies in your industry? There’s no substitute for directly relevant experience. Also ask about any awards or distinctions they’ve received that reflect the quality of their offering. When comparing cloud ERP vendors, IT analyst reports are both helpful and widely trusted.

Vendor Past Performance and References

Although past performance is no guarantee of future results, a thorough reference check with existing customers can provide a strong indicator of a vendor’s capabilities, strengths and weaknesses. Unless prompted otherwise, most vendors will share only their success stories, including in their response hand-picked customers that have had positive experiences. Even so, no ERP implementation is perfect, at least not out of the gate. A good discussion with a current customer should probe for the challenges that emerged during the implementation process and how the vendor helped surmount them, thus providing insight into the vendor’s character. Of course, additional outside web research also helps create a more complete picture of a vendor’s track record.

Budget and Pricing

Cost is a key factor in many organizations’ choice of vendor, though it isn’t always primary. Ask each vendor to include detailed cost breakdowns, including any up-front implementation fees, separate module charges, per-user charges, etc. Ask for short-term and long-term costs, i.e., a 3-to-5-year view, to avoid surprise costs later.  

Evaluation Process

Being clear about your evaluation criteria, whether you’ll weight each criterion differently (and what those weightings are, if you do), the process you’ll follow to evaluate responses and who in the organization will participate allows vendors to format their RFP responses accordingly. Include anticipated follow-ups, such as on-site (or video conference) demonstrations. When vendors know how their responses will be assessed, they are more likely to deliver submissions that directly address your ERP needs. Understanding how your selection process works and how long they should expect to wait for an answer will guide vendor expectations, and give your team time to properly evaluate each RFP response and choose the best one.

Award Process

Once all RFP responses (and any follow-up inputs) are evaluated and an ERP vendor selected, you will need to issue an award. The common approach is to send the winning vendor an award letter and purchase order (PO) to kick off the project. Some businesses prefer to issue a letter of understanding (LOU) and a contract, with the LOU summarizing the contract’s terms. It’s also good practice to issue rejection letters to unsuccessful vendors in recognition of their time and effort.


Make sure to provide contact details as part of your RFP so vendors will know who to reach out to with questions during the RFP process. Those contacts might include stakeholders within your organization, like the IT director who will lead the ERP implementation, a warehouse manager who has specific needs for the new ERP system or any third-party consultants who will be working with your business on the project. These conversations with vendors can strengthen the quality of RFP response they produce.

Download the RFP for ERP Template

Download the template below to kick off your RFP development process. It includes more specific points to consider regarding each of the sections above.

Get the template

RFP for ERP Best Practices

A strong RFP document helps vendors provide better responses, leading to a more successful ERP implementation for your organization. Don’t ignore the following RFP best practices:

Be Explicit About Company ERP Goals

It sounds obvious, but remember that external vendors do not work for your organization. They need to fully comprehend your business and its needs at several levels — strategic, business-process and technical — to deliver the best possible ERP solution. In addition to being explicit about company goals, it’s helpful to prioritize your needs. Some companies weight criteria in their RFPs so that vendors know where to focus their responses.

Take Unique Business Requirements Into Account

A bank is not a retailer, and neither is a Silicon Valley hi-tech company. Every business has unique needs, dictated by their size, ambitions, the industry they’re in and the customers they serve. Moreover, no two organizations have the same IT infrastructure or operations matrix. By giving vendors insight into what makes your business unique, from data management considerations to integrations with third-party software solutions to the habits of your customers, you will help them to factor those realities into their responses.

Be Specific About Your Desired Response Format

The stakeholders involved in your ERP implementation will eventually need to evaluate hefty RFP responses from multiple vendors. One way to simplify the process is to make sure every response is submitted in the same easily digestible format, one that covers all the necessary information, eliminates fluff and sticks to the facts. It’s natural for vendors to try to upsell their solutions, but you can nip that reflex in the bud by bringing structure to the RFP response process.

Make Time for Q&A

Issuing the RFP is only the first step, from the vendor’s perspective. So, whether you meet in person or via video conference, exchange thoughts over the phone or communicate by email, set aside sufficient time to answer vendors’ questions about your RFP and evaluation process. It may feel tedious in some cases, but every question a vendor asks shows that they are invested in delivering the best response possible. Give them the guidance they need.

Ask for Past Performance Details and References

It’s worth reiterating the value of past performance details and customer references when evaluating potential ERP vendors. Ask about previous challenges/failures in addition to wins and successes.

RFP for ERP Mistakes to Avoid

Mistakes can blur the focus of your RFP and negatively affect the quality of responses you receive from vendors. Here are easily avoidable pitfalls to watch for when developing an RFP for ERP implementation.  

Lack of Company Details and Background

It’s easy to get caught up in the technical requirements of your ERP project and omit the deep background that you already know and take as given — but vendors have no idea about. Vendors need that information to deliver a complete RFP response. Providing them with sufficient insight into your organization, its goals and its pain points gives them the context they need go beyond tech specs and propose an ERP implementation tailored to your real business requirements and challenges.

Not Enough Information on Current Systems

The limitations of a company’s current IT systems are often among its primary drivers for seeking an ERP solution. Describe the systems in use today, in detail, including what you like about them and where they fall short. For instance, a manufacturer’s legacy supply chain management solution might tick every box for functionality but integrate poorly with its warehouse and inventory management software, causing fulfilment issues during peak demand periods. Understanding limitations like this helps vendors proactively address your questions in their RFP response.

Not Enough Information on Current Processes

Similarly, describe the business processes those IT systems support. Not documenting existing business processes is one of the most common, and most dangerous, mistakes you can make, because ERP solutions can transform business processes. They can significantly streamline, automate or otherwise enhance them. But these benefits cannot be realized without a clear articulation of the starting point and your vision for improvements.

Only Including a List of Requirements

Technical requirements are crucial to your RFP, but they do not tell the full story. Many ERP solutions can serve a large and diverse array of business processes, from payroll, finance and accounting to marketing, sales, HR, inventory management, factory-floor operations, e-commerce websites — and much more. And every business has its own workflows, which is where the differences among various ERP solutions come into play. Knowing this, RFP authors could script an explanation of how their company plans to use its new ERP solution so vendors can zero in on the functionality that matters most and recommend ways to organize it.

Underestimating Total Costs

It is common for ERP implementation projects to go over budget, often because a business didn’t account for all its needs or customizations when creating the RFP. Others may have misunderstood the nuances of cloud versus on-premises delivery models, which makes it difficult to accurately calculate short- and long-term ERP costs. The best way around this is to take enough time when developing an RFP to make sure every need, technical requirement and customization is accounted for before sending it to vendors. It is also prudent to leave wiggle room for the unexpected, be it new business priorities or the need to take on additional ERP features during the implementation.

Not Meeting the Implementation Team First

Salespeople write RFP responses. ERP solutions are installed by your vendor’s highly trained technical specialists. The latter are the people who will work closely with your internal ERP implementation team to bring your solution to life over the course of weeks or months. For this reason, it is helpful to meet, in person or via video conference, to get to know each other before signing a contract to make sure they appreciate your requirements and verify that their values align with your own values as a business. In other words, look for a good technical and cultural fit.

How to Evaluate ERP RFP Responses

The way your business evaluates RFP responses is as important as the development of the RFP itself. A methodological approach is best, ensuring that every response is judged objectively and with the same level of scrutiny. It is also helpful to ask for any additional details from your ERP vendors that will factor into your evaluation and allow you to rank their responses, based on a complete picture of their offerings.

Rank Vendors by Completeness of Offerings

An appropriate first step is to rank the responding vendors by the quality, relevance and completeness of their offerings. Does the response demonstrate the vendor’s comprehensive understanding of your company’s priorities and how you wish to evolve business processes going forward? Any vendor that fails that test, doesn’t meet a key requirement or doesn’t propose a third-party integration to plug a gap in their software should be removed from the short list.

Compare Support and Service Options

An ERP implementation doesn’t end when the software is installed, especially if your business is using the solution to gain new capabilities and transform the way it operates. That requires continuous support and service from your ERP vendor. Be sure to scrutinize each vendor’s service-level agreement (SLA) regarding ongoing support to understand what’s included, how long that support will last and whether it incurs additional costs.

Arrange Custom Demos

Product demos are an opportunity to see your vendor’s software in action. While most vendors share in-depth overviews and screenshots of how their ERP technology works in their RFP responses, there is no substitute for seeing a solution in action and being able to ask specific questions about what it can, and cannot, do. Gravitate toward vendors that tailor their demos to your business’s specific needs and way of operating, which shows both an understanding of your organization and an investment in your success.

Ask for Pricing Details

Once you’ve narrowed your list of vendors to those that have understood your business’s needs, met your ERP project requirements, answered follow-up questions and proven the quality of their software through a custom demo, it’s time to compare pricing. No matter how much pricing detail the vendor provides in its RFP response, ask for a live meeting to walk through the details and uncover any unspoken assumptions by you or the vendor. Getting on the same page now is crucial to avoiding potentially damaging misunderstandings down the road. Don’t forget to include training costs in your request, as employee training will play an integral role in the success of your ERP implementation.

With your ERP vendors now ranked by both their offerings and price, you can award the project to the vendor that strikes the best balance and that matches your preferences for cultural fit.

NetSuite’s Comprehensive ERP Meets the Needs of All Aspects of Your Business

Every business has different requirements for its ERP implementation. What’s more, those requirements will change over time as the company grows, adds new product or service lines and adapts to new market opportunities. They need an ERP partner that covers every need they have today, as well as every need that will arise in the future. From core financial software that supports accounting teams to payroll and talent management solutions for HR to supply chain management (SCM), inventory management and warehouse management solutions for procurement professionals, NetSuite’s ERP is as comprehensive as it is powerful.

NetSuite’s ERP software has also been tested and proven across industries. As proof, consider these three ERP implementation case studies: There’s men’s retailer, Fulton & Roark, which centralized its data entry on NetSuite ERP and grew its sales 50% year on year without adding headcount; or moving equipment distributor, N&N Moving Supplies, which expanded its business into multiple states and quadrupled its workforce while reducing payroll processing times by 84% and balancing its books faster than ever; and, finally, Green Rabbit, a candy wholesale startup that got its business up and running on NetSuite ERP in three months in anticipation of its rapid growth. Three distinct industries. Three sets of needs. One solution to cover them all.

A successful ERP implementation starts with a clear vision. The key to bringing that vision to life for your business is to develop a thoughtful RFP that outlines every requirement in detail for vendors. Take the time to pull together the necessary information, get the right stakeholders involved and create a comprehensive RFP document, and you will be rewarded with an ERP vendor that truly understands what your business hopes to achieve — and that has the technologies and experience to make it happen.


What is RFI in ERP?

An RFI is a request for information. Companies send RFIs as an open invitation to ERP vendors to share top-line details about their solutions, services, experience and credentials. By evaluating RFI responses, businesses can narrow their list of preferred ERP vendors to a subset that meet their requirements. Often, but not always, the next step is to send a request for proposal to that short list.

What is an RFQ?

An RFQ, or request for quote, is a document that spells out a relatively simple set of business or technology requirements and invites vendors to quote a price for providing them.

How do you write an RFP for ERP?

There is no set way to write an RFP for an ERP. A best practice is to systematically describe your business’s ERP implementation requirements at the business-strategy, business-process and technical levels. Also, so that vendors can respond with a complete proposal, it’s a good idea to include context in the form of background information about the business and its goals, the project scope and how you intend to evaluate responses. It’s common for businesses to use an RFP template, which simplifies the process and ensures that all the necessary information is included in the RFP.

What is RFP in ERP?

An RFP, or request for proposal, is a document developed by your business and sent to a short list of vendors, inviting them to propose their best possible solution for your business’s ERP needs. After evaluating each solution, your company can then weigh each response against your ERP implementation criteria and broader business ambitions to choose the ideal solution.

What should be included in an RFP?

An RFP should be as comprehensive as possible so vendors have a complete picture of your business and strategic goals, as well as the technical requirements of your project. Be sure to include top-line information about your business, a project scope, a detailed list of requirements and information about how you expect to evaluate vendor responses. Ask vendors to clearly outline their qualifications, past experience, awards and any details about their track record that will help you make a sound decision.

Does ERP include procurement?

ERP systems combine many business functions, including procurement. Effective procurement processes can touch on operations, finance, logistics, supply chain and vendor relationships, and ERP systems allow your business to integrate views of data from all these processes in one centralized system.