Let’s Talk Workstation Procurement
As your Managed Services Provider, ProviDyn’s goal is to promote standards that will maximize service quality, operating agility, and budgetary predictability.
Since an IT system is only as strong as its individual (and modular) parts, we are firmly committed to ensuring all elements are closely vetted before integration.
We are also committed to making sure you understand the business rationale behind all of our recommendations.
For example, what is the real cost to procure and integrate a new workstation?
You need to know. You also need to be accountable to team members who may have questions.
In the spirit of “In God we trust, everyone else bring data,” we are going to provide three simple scenarios for you to compare and contrast.
Real cost figures assume hardware, services, and an exploration of the relevant soft costs.
This analysis does not cover sales tax and shipping fees. Those are assumed to be uniform.
Scenario # 1 - You Find a Good Deal and Run With It
After receiving a quote from ProviDyn for a Lenovo ThinkPad T14 Laptop, you decide to look around and do a little gut check on the price.
You end up on Amazon and find an item that most closely fits the specs for $1,279.99.
Note: even if you search by the manufacturer’s product number, Amazon doesn’t always have the exact items in stock. They also have a lot of gray market products, discontinued items, close-outs, and many are not automatically covered by 3-year manufacturers’ warranties.
If you visit Office Depot and CDW online, and use the precise manufacturer’s product number, you may find exactly what you’re looking for: $1,549.99 and $1,574.99, respectively.
Both of these offers include 3-year manufacturer warranties.
However, since these prices are higher, you opt to go with Amazon.
First things first, you don’t have to be an MIT graduate to select the type, make, model number, and included accessories.
However, concerns may arise over the time involved. How long will it take you to get it, right?
Do you know how to integrate the device within your organization’s technology stack?
Accounting for salary, benefits and netting out vacation time, if you’re an office manager making $60,000.00 per year, you’re a $39.00 per hour resource.
Learn More: Office Manager Salaries
Assuming finding, ordering, and setting up the new device only takes four hours, you’ve just turned a $1,279.99 laptop into a $1,435.99 laptop.
And other costs are on the way.
Are you prepared to deal directly with Amazon, the particular seller on Amazon, the manufacturer, and UPS or FedEx if a return is warranted?
The following information is cited verbatim from Amazon Warranty & Support Details:
“...Any returned computer that is damaged through customer misuse is missing parts, or is in unsellable condition due to customer tampering will result in the customer being charged a higher restocking fee based on the condition of the product…”
I interpret this as a warning to “Do It Your-Selfers” who damage the product, trying to set it up.
Scenario #2 - You Find a Deal Then Delegate the Rest to ProviDyn
Let’s assume you receive a project quote from ProviDyn and decide to shop around.
You might even say to yourself, “I thought technology was getting cheaper and faster? I’ll buy something myself and have ProviDyn do everything else.”
Let’s assume you order the Lenovo ThinkPad T14 Laptop you found on Amazon for $1,279.99 and send it to ProviDyn.
If your hourly rate is $39.00, and it took you two hours to research, and find the right specs, the $1,279.99 laptop is now a $1,357.99 laptop.
Once it arrives at ProviDyn, engineers have to prep the machine because it may have shipped with adware, bloatware, and even malware. Unfortunately, that’s a thing these days.
Learn More: Malware On New Computers
ProviDyn also has to charge you a variable build fee instead of a fixed-fee.
Why? This purchase decision is outside the scope of the process defined in our Master Services Agreement. It requires time-consuming workarounds to make sure the new device conforms to quality control, cybersecurity, and insurance liability standards.
If it takes four hours to prep the machine, the extra charges may amount to $700.00. The tab on the new laptop is now $2,057.99.
This fee is not written in stone. Extra fees are considered on a case-by-case basis and are rarely enforced unless we expect higher than normal support effort. For example, one of our clients bought a machine at Best Buy with the wrong operating system (Windows Home) and we treated it as a time and materials engagement.
We just want to be forthright about mentioning this to protect ourselves against a deluge of unconventional workstation build requests. We also want to encourage our clients to follow a process that was designed to maximize client satisfaction.
There are other considerations. What if it needs to be returned? Did you order a Core i7 but receive a Core i5 instead? Did you unwittingly order a refurb - without a warranty?
What if you went for an HP laptop and it won’t fit into your Lenovo docking station?
You’re now on the hook with an Amazon seller for all of the Warranty & Support logistics...if it’s actually available.
Scenario #3 - ProviDyn Manages the Entire Project for You
ProviDyn sends you a quote and the total cost is $1,780.00. Naturally, you wonder why the total cost is more expensive than Amazon, Office Depot, and CDW.
Let’s discuss the factors that affect the total cost.
When ProviDyn acquires a laptop for $1,400.00, we mark it up by 10% to cover our costs (and be competitive with MSRP pricing with reputable online sellers like Office Depot and CDW). So this line item comes to $1,540.00.
This makes the laptop more expensive than Amazon, and less expensive than Office Depot and CDW.
However, ProviDyn makes a significant investment of time and capital before you see our quote, as well as after you approve it.
A system engineer using a real-time procurement management system sources three different wholesale distributors: Ingram Micro, Synnex Corp, and Tech Data to procure what you need - and what will align with your network architecture.
Special attention is paid to supply chain availability and shipping timelines. This is critical with current pandemic trends and other events that impact distribution.
ProviDyn extends credit to you and buys the product on your behalf.
We don’t simply ship the item to you; it is set up, imaged, and configured with your network for a fixed build fee of $350.00, no matter how long it takes - two hours, four hours, six hours, or more.
ProviDyn has Return Merchandise Authorization (RMA) for all warranty issues and returns. And we’ll do all of the legwork if the item is not a fit.
We have reviewed three basic pricing scenarios:
- $1,435.99 and counting!
- $2,057.99 and counting!
- $1,890.00 and final! The cost is capped.
And we haven’t even broached the topic of locking in better pricing for larger volume orders, including manufacturer specials and rebates.
Going through Amazon sellers can be risky and expensive. Buying from Office Depot and CDW is not a turnkey endeavor and requires additional steps and costs.
By consolidating the sourcing, configuration, and integration processes into a unified workflow, ProviDyn helps you avoid logistical glitches, delays, and unforeseen costs.
For a little perspective and a final word on soft costs. Everyone at your company is relying on team members to collaborate and be actively engaged.
When a high-value executive is waiting for a machine to arrive or be configured correctly, they aren’t contributing at 100%. The same can be said of everyone else in your organization. A weakness in one area affects all areas regardless of whether you make $250,000.00 or $50,000.00 per year.
I hope this gives you a transparent view into our pricing rationale and the concrete business reasons for allowing us to handle all of the procurement details on your behalf.
Please share this article with your Technology Planning Committee, and contact the procurement department at email@example.com if you would like to set up a call to discuss further.