The RFP Process Made Simple

The RFP Process Made Simple

The first step within the RFP process is to establish the companies you wish to consider as potential bidders on your distribution business. You've gotten, essentially, options: specialist firms that provide distribution companies to book publishers, and book publishers who handle distribution for other publishers.

Every of these options has its pluses and minuses. Consider each—the broader you forged your net, the higher your options, as well as your understanding of the range of companies available.

Regardless of the players you consider, your RFP should be sent to a minimal of 4 bidders, and you should permit ample time (four months, minimal) for your complete process from RFP creation to remaining vendor selection.

Protect Your Info
Earlier than you exchange any information, all prospective bidders must be required to sign a non-disclosure agreement (NDA). The NDA shouldn't only include prohibitions towards divulging confidential monetary and operational information provided by either party, but should contain a clause clearly prohibiting the discussion of the RFP with unauthorized parties within the writer’s organization. Moving to a third-party distribution business model is a significant step, and till the decision is finalized and a transition plan confirmed, the details of the trouble ought to be shared only on a necessity-to-know basis. Beyond the potential anxiousness and disruption to your small business, your negotiating leverage is diminished in case your effort is tormented by info leaks.

Part One: Your Wants and Expectations
An RFP should have two main sections. Section 1 ought to contain information about your existing operations and your expectations for your small business over the three to 5 years following the transition to the third-party provider.

The latter is particularly vital—especially in case you see your organization embracing the operational opportunities offered by print-on-demand (POD) and brief-run digital printing. As POD pricing continues to say no to near-commodity levels, printing technology improves and inventory turns into virtual, the calls for on distribution facilities will undergo dramatic change—all of which ought to translate to reduced operating prices for publishers.

Section 1 additionally should include, at minimum, quantitative particulars for your online business’ last full, fiscal 12 months, together with:

Number of active customers
Number of invoices and credit memos issued annually
Calendarized gross sales and returns—in both dollars and units
Transaction particulars, together with number of units per invoice and number of lines per bill
Number of titles in active backlist
Number of new titles printed yearly
Examination copy volume
Average number of books in storage
Specialised service requirements, together with kitting, worldwide shipments, sticker application, re-jacketing, etc.
Publisher service expectations, together with time-in-process necessities for major processes corresponding to revenue and complimentary-copy order success, returns processing, check-in and availability of incoming stock, etc.
Be Accurate and In-depth
The quality and quantity of the knowledge you provide will have a direct bearing on the accuracy of the bid and the quality of the working relationship between you and your distribution partner. It's a good suggestion to include a multiyear view of the information listed above that illustrates both historic traits and prospects for the future.

Part Two: Ask the Right Questions
Section 2 of the RFP provides the prospective distribution partners with detailed questions relating to their organizations, the companies you would like them to provide and, in fact, the
related costs.

The RFP should, at minimal, request the next:

• Distributor background, including history, ownership, group chart, client list and financial statements.

• Operational descriptions. Request a list of critical warehouse, fulfillment and service processes, and written descriptions together with workstream diagrams. The operations should include order intake, pick, pack and ship, customer service, invoicing, credit and collections, and processing of incoming shipments.

• Service-stage standards. Request that the distributor provide details of service-stage standards (e.g., time in process) for critical enterprise operations.

• Stock administration, including physical inventory processes, shrink-
control procedures, back-order reporting and management, and audit controls.

• Digital services. Several main distributors have established strategic alliances with POD specialists, digital asset management service providers and e-book distributors to offer a broader range of services. These providers provide the smaller publisher a remarkable opportunity and ought to be totally explored as part of the RFP process.

• Computer systems, together with an entire description of the hardware and business software in place, plans for any upgrades or replacement of the business systems, EDI/ONIX capabilities, shopper information access and reporting capabilities.

• Contingency plans, together with
catastrophe-recovery plans for the facility and business systems, and a readiness plan within the occasion of a pandemic flu outbreak. A surprising number of publishers have asked their suppliers to provide their business continuity plans for managing by way of a flu epidemic.

• Buyer references. While references provided by the distributor will only be from happy clients, they're nonetheless valuable and must be completely researched.

• Payment structure. Distributors typically will quote companies on a transaction foundation or as a percentage of net sales. The writer ought to specify the favorred pricing methodology, but for ease of comparing prospective costs with historical spending, the share of net sales method is recommended. In addition to the base costs, the distributor should be asked to provide an in depth list of costs that aren't included within the base payment, resembling excess returns prices, extra inventory, custom-made reporting charges, etc.

• Transition costs. The move from your present distributor to your new provider will not be without costs. The distributor must be asked to provide an estimate of the transition expenses that might be billed to you—if any—including inventory transfer, data upload and another expenses for which the distributor will anticipate to be reimbursed.

• Sample contract. You must have your legal advisor assessment the distributor’s sample contract.

A Service Indicator
A carefully crafted RFP is essential to effectively evaluating the potential value of third-party distribution. The time you invest in it can be time well spent.

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