* Beware enitcing year-end contracts
As year-end nears, many vendors are offering special discounts and additional enticements so they can meet their quotas and boost their revenue before the end of the quarter. Make sure your IT procurement people don’t get trapped into signing a contract that isn’t beneficial to your business, advises Joe Auer, founder and president of consulting firm ICN.
ICN stands for International Computer Negotiations, a consulting firm specializing in IT procurement. Auer says that signing a year-end special could cause you to lose out on further cost savings and contract protections. Below, he shares his expertise in analyzing a vendor’s offer.
Ask yourself three key questions:
* Is there a legitimate business need for the product?
* Are there terms and incentives offered that can be of value to the business?
* Are the terms and conditions favorable?
Most often, the answer to the latter is no. Suppliers often insist on using their standard contract firm. And the special deals being touted often offer little in the way of favorable terms and conditions, causing your company to give up warranties, remedies for nonperformance and other valuable contract provisions pertaining to service levels, warranties, broad rights to intellectual property, remedies for non-performance, and so forth.
If you can’t come to an agreement before the calendar page turns to 2007, you may not be missing out. “In many cases, when the vendor has used the end-of-the-year ploy and the customer has refused to sign, that “absolute best deal” has continued to be available for months into the new year,” Auer says.
For more information about ICN’s services as well as articles with negotiation advice, click here.
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