The latest and greatest BI and analytics technologies are at the top of many companies' must-have lists. And it is easy to see why-- these tools allow businesses, such as retailers, to gather huge amounts of valuable information to predict customer behavior and increase revenue.
The high demand for these technologies and solutions has, unfortunately, motivated vendors to pursue higher margins by charging higher prices and offering complex terms. Many IT leaders and purchasers may fall prey if they lack the knowledge to secure a good deal.
But if you plan ahead and take this advice into consideration, you can avoid overpaying:
Consider third-party providers
The only way to ensure a good deal is to carefully weigh all of your provider options. Always include several third-party alternatives since this is probably where you will find the best price and terms available.
Separate ROI from price
Don't be convinced by vendor ROI claims when it comes to the price of your purchase. Most ROI claims are exaggerated and should not be tied to price in any way.
Bundles aren't always best
You may be tempted to bundle services when vendors offer high discounts. Don't be fooled! These bundles probably include services you don't even need. Before you agree to a bundle deal, figure out which services you will actually need and get the cost for each. You may save money buying them individually.
Be wary of fixed-fee implementation
To understand true cost-to-serve, you need to know vendor implementation costs on a time and material basis. The problem with fixed fees is that they are really never truly fixed. There are always hidden costs and fees that arise and implementation gets underway.
Position your purchase properly
Before you start the purchasing process, you need to understand completely the reasons you are buying the technology solutions, as well as what metrics you will use. All parties involved must agree on the strategy and any goals set forth. Be prepared with benchmarked pricing and vendor comparisons. By planning ahead and securing the best positioning, you should be able to save 15-20 percent from the get go.
The high demand for these technologies and solutions has, unfortunately, motivated vendors to pursue higher margins by charging higher prices and offering complex terms. Many IT leaders and purchasers may fall prey if they lack the knowledge to secure a good deal.
But if you plan ahead and take this advice into consideration, you can avoid overpaying:
Consider third-party providers
The only way to ensure a good deal is to carefully weigh all of your provider options. Always include several third-party alternatives since this is probably where you will find the best price and terms available.
Separate ROI from price
Don't be convinced by vendor ROI claims when it comes to the price of your purchase. Most ROI claims are exaggerated and should not be tied to price in any way.
Bundles aren't always best
You may be tempted to bundle services when vendors offer high discounts. Don't be fooled! These bundles probably include services you don't even need. Before you agree to a bundle deal, figure out which services you will actually need and get the cost for each. You may save money buying them individually.
Be wary of fixed-fee implementation
To understand true cost-to-serve, you need to know vendor implementation costs on a time and material basis. The problem with fixed fees is that they are really never truly fixed. There are always hidden costs and fees that arise and implementation gets underway.
Position your purchase properly
Before you start the purchasing process, you need to understand completely the reasons you are buying the technology solutions, as well as what metrics you will use. All parties involved must agree on the strategy and any goals set forth. Be prepared with benchmarked pricing and vendor comparisons. By planning ahead and securing the best positioning, you should be able to save 15-20 percent from the get go.
About the Author:
Joseph B. Kappernick specializes in helping Fortune 500 companies save money. He recommends that you visit NPI to learn more about IT cost reduction service
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