Three offers come in for the same need, with varying figures. The biggest temptation is to immediately sort by price and choose the lowest. The problem is that the three offers often don't account for the same things: one includes shipping, one doesn't include tax, and another uses a lower-grade material. Comparing them as they are is like comparing three different things and calling it a competition.
1. Standardize the Basis of Comparison First
Before comparing any numbers, ensure all offers are talking about the same scope. Some points that most often make comparisons unequal:
Material specifications and quality—whether all offer the same grade, or if some offer equivalent alternatives.
Quantity and unit—price per unit, per set, or per package; whether accessories are included or not.
Delivery point and shipping costs responsibility—this is most often overlooked. Ensure delivery terms are explicit; if necessary, see details in the Incoterms 2020 guide.
Tax—whether included or not, as the difference can reverse the order.
Offer validity period—a price valid for only seven days is not equivalent to one locked in for three months.
If there are differences, don't guess. Request a revised offer with a standardized scope—this request is reasonable and shows that your procurement process is organized.
2. Calculate Cost to Warehouse, Not Offer Price
The figure worth comparing is the total cost until the goods are ready for use: goods price, shipping costs, duties and taxes, unloading costs, and installation costs if any. A five percent difference in unit price often disappears once inter-island shipping costs are included. We discuss the complete framework separately in the landed cost article.
3. Determine Criteria Weights Before Looking at Offers
This is the most often skipped step, and the most crucial for fair comparison. If weights are determined after offers are opened, criteria tend to be unconsciously structured to justify a preferred candidate. Establish them beforehand, for example:
Total cost to warehouse—40%
Compliance with technical specifications—20%
Lead time and delivery reliability—15%
Supplier track record and capacity—15%
Warranty and after-sales support—10%
The numbers above are just examples. For machine spare parts for a production line that has stopped, lead time can be much more critical than price. The important thing is that the weights are set based on project needs, not based on offers already in hand.
4. Create a Comparison Table with Uniform Columns
Create one row per criterion and one column per supplier, then fill with data—not impressions. Instead of writing "responsive," write "responded to RFQ within 1 working day." Instead of "extensive experience," write "operating since 2011, has handled similar orders." Score each criterion on the same scale (e.g., 1-5), multiply by its weight, then sum them up. The result is not an automatic decision, but a verifiable basis for discussion for superiors and audits.
5. Check Things Not Reflected in the Numbers
Some factors are not included in the price column but determine future costs:
Payment terms—a request for full payment upfront shifts all risk to you.
Clarity of warranty—how long, what it covers, and who bears the shipping costs for claims.
Availability of spare parts—especially for equipment with a long service life.
Quality of communication during the offer phase—a supplier who is slow to respond when trying to win usually doesn't get faster after the PO is issued.
Willingness to be verified—refusing to provide documents or visits is a signal worth considering.
6. Record the Reasons for the Decision
Keep the comparison table along with its weights and scores with the procurement documents. This has two benefits: it becomes an audit trail when decisions are questioned, and it serves as a benchmark when similar procurements recur next year. Procurement teams that maintain evaluation history work much faster in subsequent cycles because they don't start from scratch.
If Too Few Offers Are Received
Comparison is only meaningful if there's something to compare. Two offers from the same limited circle of suppliers make you lose bargaining power without realizing it. Expand your candidate list before the next RFQ is sent—and ensure that the suppliers you invite truly match the scale of your needs, not just to increase the number of offers. Initial screening steps are in the checklist for choosing reliable industrial suppliers.
Prepare your evaluation framework before the next RFQ. Download the free B2B Procurement Guide 2026—containing a framework for selecting, verifying, comparing, and negotiating with suppliers in a single workflow.