Tenders and Quotes have many common characteristics but have subtle differences. This article clarifies the differences in a deeper understanding of tendering.
A tender and a quote are both formal offers to perform work in return for payment. ‘Work’ is the supply of goods or services or both. Payment is generally via a fixed price or a schedule of rates. Buyers may request work via a tender from suppliers by issuing some form of Request for Tender (RFT) or via a quote by issuing some form of Request for Quote (RFQ).
The acceptance of response to a tender or a quote typically results in a contract between the buyer and the supplier.
What Tenders and Quotes Have in Common
Requests for tenders and quotes typically have the following common characteristics:
| Shared Feature | Why it Matters |
| A written request document | Outlines scope, deadlines, and terms. |
| A defined scope of works | Clarifies deliverables for accurate pricing. |
| Multiple suppliers invited | Ensures competitive pricing and capability. |
| Fixed price or schedule of rates | Establishes payment terms up-front. |
| Response deadline | Keeps procurement on schedule. |
| Contract award | Formal agreement with the winning supplier. |
When to Expect a Request for Tender (RFT)
The use of tenders for works is common where the monetary value is high (typically greater than $250,000), the scope of work is complex, or there is significant risk involved. The tender process is more rigorous than the process used for quotations. Each tender is governed by its own rules and conditions referred to as the conditions of the tender. In addition, there are often pre-determined criteria to evaluate the tender responses, which typically include the respondent’s experience and capability.
As tenders are typical of a higher monetary value, they are often made public and are open to anyone who meets the eligibility criteria. This can result in intense competition with ten or more respondents. The higher stakes mean buyers apply strict probity rules and scorecards covering price, experience, capability, and risk mitigation.
When You’ll See a Request for Quote (RFQ)
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Lower-value purchases or routine services
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Well-defined, low-risk scopes
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Faster turnaround and simpler contracts
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Fewer suppliers (sometimes only three)
RFQs still demand accuracy, but you’ll spend less time on compliance documents and more on sharp pricing.
The main differences between a Tender and Quote:
| Factor | Tender (RFT) | Quote (RFQ) |
| Value | Higher | Lower |
| Risk / Complexity | High | Low - Moderate |
| Process | Formal and audited | Streamlined |
| Response Effort | Extensive | Moderate |
| Competition | Often 10+ bidders | 3 - 5 bidders |
| Contract Terms | Detailed and stricter | Standard |
More Information
If you want to learn more about quotes and preparing quotes in Australia, check out Business.gov.au. If there are more terms you're unsure about check out our blog on All the Tender Terms You Need to Know!
Need Help with Your Next Submission?
If you want to learn more about how we can help your tendering process, drop us a line via email at support@australiantenders.com.au. Alternatively, check our our free "Introduction to Tendering" eBook. It has everything you need to know about procurement and getting started on your journey. We want you to win, and we're here to help you.
