This is the process that I use to setup a new Ruby on Rails site with vendor bundle.
First lets make a new directory where the project will reside.
cd into the new directory.
Lets create the Gemfile.
echo "source 'https://rubygems.org'" >> Gemfile
And add the rails gem to the Gemfile.
echo "gem 'rails', '5.0.2'" >> Gemfile
Next we will install the rails gems in our project vendor/bundle
bundle install --path vendor/bundle
Now we can create our rails project.
bundle exec rails new .
You will get a prompt to overwrite the
Y to allow the overwrite.
Last step is to add
/vendor/bundle in our project