My vendor is offering a free evaluation of my document management system, why wouldn’t
I just use them?
Try this next time you buy a car. Go into the dealer you bought your last car from,
tell them what you are driving now, what you would like in a new car and have them
tell you which car you should buy and how much you should pay. Sound ridiculous doesn’t
it? Well that is basically, what your vendor is proposing. Fact is that your vendor
is proposing to that in order to gain profit. On average vendors gain 10% in profit
from an analysis and are 3 times more likely to close the deal. Why? Simple, they
have established your benchmark costs and efficiencies (right or wrong) and can pick
the point at which they feel you will still go with them. Conversely, in a bid situation,
the vendor will pick a price based upon market pricing and their need to get the
To give you an example of this we can use an anonymous customer of the Ascher Group.
This company had received three proposals from vendors based on an analysis each
vendor had performed. Their problem was that each was using cost savings from eliminating
HP printers and outsourced copying to justify their solution and each had a different
cost associated with these elements. The vendors ran the gamut on costs with three
different cost structures from $5,800 to $7,100. The Ascher Group performed a thorough
analysis of the actual costs and found that the real number was $3,600. The difference
was that all vendors used an average cost per impression on the HP printers and estimated
outsourcing costs. When the Ascher Group did the analysis, actual invoices were assessed
to come up with a monthly cost for each item.
To summarize. Letting a vendor do the analysis is less than desirable because:
Hiring a vendor (or letting them do it for "free") takes away a large piece of your
price negotiating power.
Vendors are more likely to take short-cuts within your current costing program thus
leading to erroneous results.
By definition the vendor will not be neutral in their analysis or recommendations.
If you were to hire the vendor you would be paying for presales work, something that
they give away to everyone else.