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Shop IT Till You Drop IT

Vendor relationships are important and certainly necessary but your IT vendor is likely a cost center instead of a revenue generator. Lessening expenses on commodity IT service allows your business to invest in revenue generating endeavors like marketing, sales, support staff, training and research and development.

Step one:
Evaluate expenses. This includes, but is not limited to, computers, printers, telephone service, software, email and other technology-related things your business spends money on without giving it much thought. Office 365, for example, is often touted by industry experts as a good choice but doesn’t make financial sense for firms of a certain size or scale. SEO (Search Engine Optimization) for websites is another typical cost center with variable value for smaller businesses and is often vaguely explained or understood by those selling it. In some cases, redirecting SEO money into marketing on social media and connecting with users in a more personal way is a better use of limited finances. Remember there is no silver bullet. There is value in continual improvement and assessment of business costs, including any IT vendor relationships you may have. Taking the opportunity to do a little “house cleaning” can pay off in big ways.

Step two:
shop IT till you drop IT. You have alternative IT solution providers in your region. Because of a glut of IT providers in the market, most providers are commodity brokers (meaning they all sell basically the same products). Most economists would tell you competition on this level should lower prices but many IT solution providers overvalue themselves and most are charging similarly high prices for the commodity work they do.

Customers shouldn’t have to pay a premium for a commodity. Consider contacting a few providers and ask for competitive bids. Don’t be afraid to let them know exactly what you’re doing. They should ask what you have, how you use it and seek to understand how your business works before offering up solutions and pricing. The only way for them to know what you really need is to ask questions!

Step three:
Compare bid proposals, contracts, costs and potential value to your business. Ask for things to be explained and jot those explanations down so you can later assess their recommendations for yourself. For example, you might often hear the buzzword “cloud” as a magical solution to IT problems. Cloud, much like SEO, is often misunderstood by those who sell it. Cloud is a method of storing and using information and software applications from a number of offsite servers via the internet, insuring that failure of one source doesn’t interrupt service. Many vendors selling cloud are actually selling hosting services that reside in a single instance, on a single server, in a single location and isn’t distributed at all. Companies often misunderstand the two terms entirely. You should pay a lot less for hosting than you would for cloud. Cloud is far more complex and should have 100% uptime with respect to connectivity.

IT solution providers are, by in large, commodity brokers so if you’re not paying commodity prices now is a great time to re-evaluate your vendor relationship and shop IT till you drop IT. IT services are available in varying degrees of price, quality and service. Does your business have basic IT requirements or do you have specialized concerns around governmental regulation? What is your current provider telling you about meeting those requirements and at what price? Can you shop around and find a better deal from a company offering the same thing or pay even less for a better solution and better service? It is easier to switch providers than you might think and you may find yourself saving a significant amount of money on your bottom line year over year doing so.

Rafael has owned and operated EITS since 2002 and has become an expert IT generalist. He has a team of experts who design, deploy and support IT systems throughout Michigan

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