Several vendors selling in today’s marketplace would have buyers believe that “the quote” has gone the way of the dinosaur, or at the very least is heading towards extinction. But the IT vendor quote is far from dead. In fact, it’s never been more important.
These vendors argue that quotes are limiting, they are unnecessary, they no longer really capture the essence of the proposal and – more importantly – they limit the explanation of the value their solution brings to the table. Instead of quotes, many IT vendors prefer to deliver their pricing via a presentation as it allows their value to truly shine. It’s also a format that is easier for you – the buyer – to consume and share with executives.
Why Presentations Are a Poor Replacement for the IT Vendor Quote
The reality is these presentations do one thing well. They create mystery in the IT buying cycle, which at the end of the process often results in buyer’s remorse. From a cost perspective, a presentation rarely tells the whole story. Compared to a traditional IT vendor quote, it often lacks detail and a full accounting of costs. It certainly falls short of providing all the terms and conditions that are associated with the purchase. They often don’t adequately communicate the full cost picture that is ultimately necessary for any organization to have when making enterprise purchases. And they are a roadblock for customers that want to perform IT price benchmark analysis to make sure they’re paying a fair price.
Contrary to what buyers may be led to believe, an IT vendor quote is not a tough ask. Every large supplier your enterprise does business with today has a pricing system in place that produces quotes. For IT suppliers with streamlined offerings, that quoting system could be quite simple. Most enterprise IT vendors, however, sell hundreds (if not thousands) of products each with distinct SKUs and descriptions. These products have very specific list pricing. Every time one of these vendors conducts a transaction, they generate a very detailed quote that is then processed through their system.
The same applies to VARs. They also have systems and procedures in place to ensure the proper products, licensing, subscriptions and services are procured on behalf of their client. This is done for two reasons: (1) Many OEMs have rules about the return of products once purchased and the hoops to go through to get through the return process are exhaustive and (2) VARs operate on margin made through the sales process. To know specifically how much money the goods and services are going to cost and, in turn, how much the VAR needs to sell the goods and services for to turn a profit, a VAR has to generate a quote.
The First Step to Pricing Visibility (and Faster Buying) is a Proper IT Vendor Quote
Most enterprises have checks and balances in place that require a proper IT vendor quote to be developed in order to generate a purchase order and payment. These quotes should include very detailed information about what is being purchased so the enterprise can verify receipt of the goods or services or purchased. That brings up another reason why enterprises should demand a quote. By asking for a quote on the front end (along with vendor’s presentation), you are speeding up your enterprise’s internal IT purchasing process.
The bottom line is this – every enterprise IT transaction should be accompanied by a detailed quote. IT should include SKUs, descriptions, quantities, list, and net pricing (and clearly defined discounting). Presentations are great for selling the idea, but terrible for pricing visibility. The next time a vendor asks you what you thought of their price-inclusive presentation, your response should be simple: “Thanks, please also send me a proper quote so I have the full story.”
If you need help demystifying IT pricing to ensure you’re getting the best deal from your vendor, let us know. NPI can equip you with vendor-specific pricing and negotiation intel to help you save on your next IT purchase or renewal.