A request for proposal (RFP) is one of the most common ways enterprise companies do business, and it’s no different when it comes to finding a relocation management company (RMC) to handle your employee mobility needs. However, the changing landscape of the relocation industry, (due to new legislation and innovation) has made many standard relocation RFP questions outdated.
Often times, when it’s time to go to RFP, HR and mobility professionals will recycle their old RFP and send it out. However, it’s important to ask yourself: would you buy a smartphone based on recommendations from 10 years ago? Or even 2 years ago? It’s likely the answer is no.
The same should be true with relocation service partners. While it’s definitely easier to recycle old relocation RFPs, you risk overlooking innovation and change that has happened in the industry.
That’s why, when your company starts the relocation RFP process, it’s important you craft the questions with a fresh perspective—otherwise you may miss an opportunity to remain on trend with the industry, reduce costs, or keep up with your competitors.
If you have little experience with the relocation RFP process, or even if this is your 6th time writing one, you should include the following questions in your next RFP.
Relocation RFP Questions
There are many things to consider when evaluating a relocation partner. However, UrbanBound has compiled the 3 questions you need to include in your next relocation RFP.
Question #1
Describe, in detail, the user experience and functionality of your company’s relocation software for transferees and employers. Please attach screenshots and be prepared to give a live demonstration of your software.
Why It’s Important
Many traditional RMCs will say that they have the technology to support the relocation process. In fact, the majority of RMCs have some sort of online portal that employees can log into. However, this is where the functionality falls short. These portals rarely have real-time data. Report customization is not an option, and employers have very little insight into how their employees’ relocations are progressing.
If an RMC is willing to provide you with a live demonstration of the software, be sure to ask about specific employer reports and find out if the RMC has to export the reports to an Excel file for you, or if they exist inside the software for you to access at any time.
Additionally, you’ll want to determine how the relocation technology helps with the employee experience. Can employees book moving services, read content and education in the software? Or is all of that done through email and phone calls? You’ll want to look for an interactive experience that drives your relocating employees through the process.
Then, after you receive a live demo, don’t be afraid to ask for a sandbox environment, where you can test out the software yourself, and see how user-friendly it actually is.
Question #2
Please explain your supply chain. How do you make decisions about what suppliers to use in your network?
Why It’s Important
If you are a seasoned RFP writer in the relocation industry, you may be familiar with this question. However, it’s important to look at this question with a fresh perspective and review what kind of answer you should be looking for. Many relocation management companies own downstream suppliers. (Think van lines, realtors and temporary housing).
If an RMC owns or is owned by relocation supplier, it means they will likely use that supplier for most relocations—whether it’s appropriate or cost-effective for that move. If an RMC has a personal stake in certain suppliers, there may be a conflict of interest.
You want to look for a relocation partner that builds their supplier network around you and your employees’ individual needs—not theirs. Many times, RMCs will make the decision about which supplier to use based on the commission they will make from the referral. If an RMC consistently chooses the more expensive option, this can greatly drive up the overall cost of the relocation.
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Question #3
What is your company doing to address the 2018 US tax reform law and the growing trend of lump sum only programs?
Why It’s Important
When the US tax reform law took effect in 2018, household goods and auto shipment, 30 days of storage and final travel expenses were no longer considered tax excludable in most states. This drove up the cost of relocation (either for the employee or for the employer). As a reaction to this, many companies have resorted to offering their relocating employees a lump sum of cash as a means of controlling costs.
Because the traditional market has a special interest in homeowners and making money off of home sale benefits, many RMCs don’t have a fully supported solution for lump sum populations. And with the majority of millennials not buying homes, companies must think of ways to offer a great relocation experience for someone who is not seeking to buy a home. You’ll want to find a relocation partner that can service these populations with a managed lump sum solution.
A managed lump sum is like a credit that an employee has to use for relocation benefits and is usually managed by a relocation partner. Let’s say someone has a managed lump sum amount of $10K. The employee doesn’t get $10K in their bank account. However, they can either use the relocation partner’s network of suppliers, (like moving companies, realtors and hotels) and have those expenses direct billed against their lump sum. They can also pay for services themselves and submit receipts for reimbursement against their lump sum.
Historically, managed lump sum didn’t work well because mobility professionals or RMCs would have to manually track invoices and manually keep a balance (similar to a checkbook). And because the bills didn’t come in real-time, there was little bandwidth to do this.
This is why it’s so important to look for a relocation partner that is a technology-first company with a managed lump sum tool. With a managed lump sum tool in place, you can apply it to programs with ten moves a year to 500 moves a year—and provide your employees with the flexibility and support they need to have a stress-free relocation.
Next Steps for Your Relocation RFP
The relocation RFP process can seem daunting, and honestly, it can be! RFPs may not always be the best way to determine a relocation partner, however, if your company requires one, you must consider including the 3 RFP questions listed above.
If you are on the lookout for a relocation partner, download our Ultimate Guide to Evaluating Relocation Partners. Your mobility program (or lack thereof) can be a true liability to your company’s bottom line. So, in this guide, you’ll learn the signs of a deficient relocation program and important questions to ask when evaluating and selecting the best relocation partner for your business.
