MAY 21, 2010 7:50am ET

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What Do You Do If A BI Vendor Offers You A "Discount" Without Published List Prices?

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I get this request almost on a weekly basis: "Boris, my BI vendor is offering me the following discount, is it a good deal or not?" The first question is what are you comparing it to? It reminds me of an old joke: Q. How much is 5 times 5. A. Depends on whether you're buying or selling. Many of the vendors do not publish or reveal list prices, or even if they do, they are revealed only under NDA to each client, so good luck comparing what the vendor told you and what they told another client. So what ARE you comparing it to?

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Comments (2)
Excellent post Boris! When I was on the software buying end of things at Shell I always had trouble explaining to the procurement people that there was no list price, so a percentage discount meant nothing. In my experience the only way to ensure a good price from vendors is to run a well-structured, genuinely competitive bake-off between the vendors, assessing the software functionality against your needs in parallel with negotiating on price. As soon as a vendor knows (or believes) it is in the driving seat, your negotiating position disappears, so it is important to maintain competitive tension.
Posted by Andy H | Tuesday, May 25 2010 at 12:25PM ET
What about using GSA (General Services Administration) pricing as a "list" for comparison puroses? Those are public, published prices. For example, I know QlikView is on GSA, because that is how we bought it for our local government.
Posted by Elizabeth G | Tuesday, June 01 2010 at 9:20AM ET
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