How to run a pallet RFQ, step by step

§1Assemble the RFQ pack

1. A spec sheet per pallet type, with acceptance and reject criteria.
2. Volumes per spec per month, with peaks, and delivery points.
3. Delivery terms: cadence, lead time, dock hours, minimum and maximum stock.
4. Commercial terms you want: price basis, index clause, payment terms, reject credit, contract length.
5. A response sheet suppliers must fill in, so bids line up.
6. Deadline for questions, deadline for bids, and award date.

The Program Builder produces a spec sheet and RFQ document from your inputs, and the bid-leveling sheet gives suppliers a fixed response format.

§2Choose who to invite

Invite three to six suppliers per spec: enough for competition, few enough that each takes the bid seriously. Consider delivery radius first; pallets are bulky, and freight is a large share of delivered price. The supply market pages show how many pallet plants each state has, from BLS QCEW counts.

Tell suppliers how many others are bidding and how you'll decide. Good suppliers bid harder when the process is clear.

§3Handle questions in the open

Answer every supplier question in writing and send the answer to all bidders. If a question exposes a gap in the spec, fix the spec and reissue it with a version number.

§4Compare bids like for like

Convert every bid to delivered price per pallet for each spec and delivery point. Add costs the price leaves out: delivery charges, fuel surcharges, minimum-order penalties, and the expected cost of rejects at each supplier's stated reject rate. See bid leveling.

§5Award and onboard

Before you sign, visit the plant or ask for a trial delivery and inspect it against the spec. Agree the index clause base month in writing. Set up the first quarterly review on the calendar the day you sign.

§6A workable timeline

Give suppliers enough time to price properly. A rushed RFQ gets padded prices or no bids from the plants you most want. A sequence that works for most programs: issue the RFQ with the spec, volumes and delivery points; hold a short window for written questions; publish every answer to every bidder at once; take bids on a fixed date; shortlist; visit or audit the shortlist; award.

Write the dates into the RFQ itself, including when you will announce the award and when the first delivery is due. Suppliers plan lumber purchases and crew time around those dates, and a supplier who knows when volume starts can quote a sharper price.

§7Mistakes that cost money later

• Asking for "48×40 #1" without defining #1. Grade words differ between suppliers; put the acceptance criteria in the RFQ.
• Quoting annual volume without the monthly pattern. Peaks drive a supplier's capacity planning more than the annual total.
• Leaving delivery charges out of the bid form, then discovering them on the first invoice.
• Letting the incumbent see competitors' prices. It ends the process as a negotiation with one supplier.