The RFP Process Made Simple

The first step in the RFP process is to identify the businesses you want to consider as potential bidders on your distribution business. You might have, essentially, two options: specialist corporations that provide distribution providers to book publishers, and book publishers who deal with 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 services available.

Regardless of the players you consider, your RFP should be despatched to a minimum of four bidders, and it’s best to permit ample time (4 months, minimum) for the complete process from RFP creation to final vendor selection.

Protect Your Info

Earlier than you change any info, all prospective bidders must be required to sign a non-disclosure agreement (NDA). The NDA mustn’t only include prohibitions in opposition to divulging confidential monetary and operational information provided by either party, but should comprise a clause clearly prohibiting the dialogue of the RFP with unauthorized parties within the writer’s organization. Moving to a third-party distribution business model is a significant step, and until the choice is finalized and a transition plan confirmed, the small print of the hassle ought to be shared only on a need-to-know basis. Beyond the potential nervousness and disruption to your business, your negotiating leverage is diminished if your effort is suffering from information leaks.

Part One: Your Needs and Expectations

An RFP ought to have two major sections. Section 1 should contain details about your current operations and your expectations for what you are promoting over the three to 5 years following the transition to the third-party provider.

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

Part 1 additionally ought to embrace, at minimum, quantitative particulars for your business’ final full, fiscal year, including:

Number of active clients

Number of invoices and credit memos issued yearly

Calendarized gross sales and returns—in both dollars and units

Transaction details, including number of units per bill and number of lines per invoice

Number of titles in active backlist

Number of new titles published annually

Examination copy volume

Common number of books in storage

Specialized service requirements, together with kitting, international shipments, sticker application, re-jacketing, etc.

Writer service expectations, including time-in-process requirements for main processes reminiscent of revenue and complimentary-copy order success, returns processing, check-in and availability of incoming inventory, etc.

Be Accurate and In-depth

The quality and quantity of the data 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 is a good suggestion to incorporate a multiyear view of the information listed above that illustrates each historic tendencies 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 services you would like them to provide and, in fact, the

related costs.

The RFP should, at minimum, request the next:

• Distributor background, including history, ownership, organization chart, shopper list and financial statements.

• Operational descriptions. Request a list of critical warehouse, success and service processes, and written descriptions together with workflow diagrams. The operations ought to embrace order intake, pick, pack and ship, customer service, invoicing, credit and collections, and processing of incoming shipments.

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

• Stock administration, together with physical inventory processes, shrink-

management 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 offer the smaller writer a remarkable opportunity and ought to be fully explored as part of the RFP process.

• Computer systems, together with a whole description of the hardware and enterprise software in place, plans for any upgrades or replacement of the enterprise systems, EDI/ONIX capabilities, client data access and reporting capabilities.

• Contingency plans, together with

disaster-recovery plans for the facility and enterprise systems, and a readiness plan within the event of a pandemic flu outbreak. A stunning number of publishers have asked their suppliers to provide their enterprise continuity plans for managing by means of a flu epidemic.

• Buyer references. While references provided by the distributor will only be from happy prospects, they’re nonetheless valuable and should be completely researched.

• Payment structure. Distributors typically will quote providers on a transaction basis or as a proportion of net sales. The publisher should specify the preferred pricing technique, but for ease of evaluating prospective prices with historical spending, the share of net sales technique is recommended. In addition to the bottom costs, the distributor should be asked to provide a detailed list of costs that aren’t included within the base fee, resembling extra returns fees, extra inventory, custom-made reporting fees, etc.

• Transition costs. The move from your current distributor to your new provider won’t be without costs. The distributor should be asked to provide an estimate of the transition bills that shall be billed to you—if any—including stock transfer, data upload and another bills for which the distributor will anticipate to be reimbursed.

• Sample contract. You should have your authorized advisor review the distributor’s pattern contract.

A Service Indicator

A careabsolutely crafted RFP is essential to successfully evaluating the potential value of third-party distribution. The time you put money into it shall be time well spent.

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