Sources of Supply in Software

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Sources of Supply
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Relations with suppliers are as critical in the IT business as in any other Because a significant part of the value that IT supplies to clients is often in the form of intellectual property, supplier relations can be complex in the IT consulting field
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Many of the credit terms discussed previously in the context of clients apply to your own organization and your suppliers At times, good relationships with suppliers can steer businesses through an unexpected cash crunch Make sure demands on suppliers are realistic and reasonable given the circumstances Suppliers need help in knowing what clients want and need Especially in small- and medium-sized consulting practices, careful choice of suppliers often gives you virtual staff on a project people who work neither for you nor the client, but whose help and knowledge may be instrumental in getting a project to succeed Be aware of everyone s lead time the client s, your own, and your suppliers in order to schedule equipment shipments that are usually expensive, and balance them with fair and equitable payment for the goods from the client to you and from your firm to the supplier You need to know what are fair, reasonable, and accepted terms when purchasing from suppliers: product availability, volume discounts, customization, bundling, return policies, warranties and tech support, as well as repair service if it applies
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You may think the universe of supply sources is fairly narrow in IT consulting, but a little work often turns up interesting alternatives Good supply sourcing often flows right to your firm s bottom line Trade shows usually yield a variety of specialty firms looking to deal with IT consultants Regional or board of trade directories usually contain suppliers of all types You won t know if there is a nugget of gold in those pages until you look Often, there is such a valuable supplier just waiting to be found Industry-specific buyers guides organize suppliers by category and region These days, you can often request an online search for a reasonable fee, thus filtering the supplier universe through your criteria
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The trade press does a lot of the work for you by carrying the ads of willing suppliers Other sources include professional organizations in your field, your own suppliers sales representatives, your clients, and other organizations in the same field
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Supplier Selection
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The process you define for selecting suppliers should be self-correcting, efficient, and well communicated to all your decision makers Here are some questions to consider: Do you need competitive quotations If so, from how many qualified suppliers How will you evaluate the bids How do such parameters as a competitive price, warranties and service, tech support, brand-name versus generic components, and licensing of intellectual property enable you to evaluate the bid Does the supplier need to be local Are shipping costs a significant factor Can you visit the supplier s premises and make a quality determination of the organization, its operations, and its people before doing business with them If your client needs to have an ongoing relationship with the supplier (for example, you are configuring network hardware, and may need to have it serviced), does the supplier have the ability and the capacity to meet your needs and that of your clients Who pays for shipping, and from where to where In other words, what is the free-on-board, or FOB, point Are there any warranty considerations Does the supplier comply with any local, regional, or national laws pertaining to the supply of goods and services For example, some hardware and software may not be sold outside North America without a specific permit Are there any patent issues or intellectual property rights to deal with in an agreement between you and the supplier, or between your client and the supplier
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