Connect981 – Content Dev

Glossary Tag: Procurement

  • Request for Proposal

    A request for proposal is a formal procurement document used by a buyer to ask potential suppliers to propose how they would deliver a product, service, system, or project. In manufacturing and industrial operations, it commonly defines the business need, technical requirements, expected scope, commercial terms, evaluation criteria, and response format.

    An RFP is often used when the buyer needs more than a simple price quote. Examples include selecting an MES, ERP integration partner, automation supplier, inspection service, outsourced process provider, or major equipment vendor. Supplier responses may include technical approach, implementation plan, assumptions, pricing, delivery schedule, support model, and evidence of relevant capabilities.

    A request for proposal should not be confused with a request for quotation, which is usually focused on pricing for a defined item or service, or a request for information, which is mainly used to gather market and supplier information before a buying decision. In practice, the terms may overlap, but an RFP usually implies a structured evaluation of both solution fit and commercial terms.

  • Tiered Supplier

    A tiered supplier is a supplier classified by its position in a multi-level supply chain, usually based on how directly it supplies an original equipment manufacturer, prime contractor, or final assembler.

    In manufacturing, a Tier 1 supplier typically supplies directly to the OEM or prime. A Tier 2 supplier supplies a Tier 1 supplier, and a Tier 3 supplier supplies a Tier 2 supplier. The same company can occupy different tiers depending on the product, program, or customer relationship.

    Tiered supplier structures are commonly used in procurement, supplier quality, materials planning, traceability, and supply chain risk management. They help describe where parts, materials, outside processing, or technical data move across the extended supply base.

    A supplier tier is not the same as a supplier rating, approval status, or quality score. It describes supply chain position, not necessarily performance, risk level, or certification status.