A Stake in the Ground
Both you and the supplier need to be clear, from the point at which they respond to your Invitation to Tender, how you intend to handle the contractual arrangements. If you want to negotiate a suitable contract you can set your stake in the ground in one of two ways:
Include a sample set of terms and condition with your Invitation to Tender. This need not be anything so elaborate as a sample contract; you could simply list the main headings on which you would expect to negotiate.
Include a session on contract terms as part of your evaluation event. This will allow you to sum up the different approaches of the interested suppliers as a factor in your final decision.
One point to bear in mind is that many software companies will set their stake in the ground by telling you that their standard contract terms are non-negotiable. The multi-nationals will say this very convincingly but all of them are able to exercise a greater or lesser degree of flexibility in the end when it comes to the difference between winning or losing your business.
An advantage of discussing contract terms as part of your evaluation is that it will give you an indication of what sort of authority your local contacts have in relation to negotiation. Flexibility of approach may help you distinguish between otherwise similar suppliers. A multi-national where the decision-making authority resides in a different country (and possibly a different time zone) may be more frustrating and, ultimately, less flexible to deal with than one where you have direct access to the decision makers.
Single or multiple suppliers?
If you are purchasing a large or complex system you may also need to decide whether you are prepared to contract with more than one supplier. It is likely you will need to purchase hardware and, possibly, consultancy as well as software. In preparing your Invitation to Tender you will need to say whether you will consider vendors who can only supply part of the package or whether you want the successful supplier to contract with you for the full solution. There are many advantages to the latter approach including time saved on contract negotiation and, more importantly, accountability. If your contract is solely with the software supplier they can’t turn round when things go wrong and blame either the hardware or the consultants who implemented the product. If you do contract separately, you need to ensure that the software vendor validates the specification of the hardware you are purchasing and the hardware supplier warrants their equipment will run the software you are buying etc, etc.
