Definition
Why companies choose not to bid
The most common reasons, say, limited bandwidth or lack of strategic fit, don’t tell the full story. In B2B SaaS, companies often opt out of RFPs for reasons that are just as strategic as they are operational. For example:
- The RFP appears to be written with another vendor in mind.
- There is no internal champion advocating for your solution.
- The RFP process is excessively rigid or time-consuming, with little room for pre-sales engagement.
- The pricing structure implies a race to the bottom.
- The vendor sees a better opportunity to engage outside of the RFP process or in a future cycle.
In these cases, submitting a proposal can be counterproductive, leading to wasted effort, misaligned expectations, or poor positioning.
For more on when to engage and when to walk away, see Breaking Down the RFP Response Process.
How to write a high-quality no bid letter
A no bid letter should be brief, polite, and forward-looking. Here are the core components:
Example:
Subject: No Bid Response – [RFP Title]
Dear [Client Name],
Thank you for the opportunity to participate in the RFP process for [Project Name]. After careful evaluation, we have decided not to submit a proposal for this opportunity.
This decision reflects current prioritization of internal resources and a strategic focus on areas where we can deliver the highest value. We remain very interested in exploring future opportunities with your organization and would be happy to reconnect for a better-aligned engagement.
Please do not hesitate to reach out if we can support in any other capacity.
Best regards,
[Your Name]
[Your Title]
[Company Name]
Strategic value of saying no
A no bid letter allows vendors to:
- Protect limited proposal and sales resources
- Avoid misaligned deals that create long-term delivery issues
- Signal professionalism and maturity to the buyer
- Maintain credibility for future engagement
It is important to remember that saying “no” today can help create a more meaningful “yes” in the future.
When a no bid leads to future wins
In some cases, opting out of an RFP opens the door to more strategic engagement later. This includes:
- Being invited for a direct contract when the original vendor underdelivers
- Being consulted for input during the redesign of a future RFP
- Gaining a stronger position in a more tailored, better-scoped opportunity
AI prompt to generate a professional no bid letter
Use this with a generative AI tool to quickly draft a tailored response:
