Accepting Gifts From Vendors

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A vendor that you’ve been working with gave you two highly coveted (and very expensive!) tickets for your favorite NFL / College Football team as a holiday thank you gift.  Should you accept them?

Before running down the office hallway and doing your own version of Lance Moore’s touchdown dance (I’m a Saints fan!), check to see what your company’s policy is on accepting gifts.  If you’re unsure whether your company has this kind of policy, talk with a co-worker and if that doesn’t work, give your Human Resources department a call.

Many companies have a policy on what kinds of gifts customers can accept and what the dollar amount on those gifts can be (i.e. no higher than $25.00). So, it’s important to understand what gifts you can or can’t accept before the holidays are in full swing and you’re fighting off NFL tickets and child-sized gift baskets full of sausage and cheese that don’t expire until 2019.

I’m sure at this point you’re asking yourself, “Why would vendors send me gifts when I have to turn them away?” Because that’s what they do. They’re salespeople. They’re running the razzle-dazzle towards the end of the Q4 goal line and along the way, they wanted to send you a thank you gift for 2013. If you’re on the phone with a vendor and they mention sending you a thank you gift, kindly let them know what your company’s policy is on accepting gifts and thank them for the sentiment.

Honestly, I let vendors know that I don’t accept gifts. They’re welcome to send a holiday card, but I like to keep everyone on the same level playing field. Just because they send me an edible arrangement of deliciousness that costs less than $25.00 doesn’t mean I’m going to buy more software licenses from them next year! So, keep that in mind as well.  If you don’t feel comfortable with the whole gift acceptance issue, just let the vendors know that you enjoy working with them (as long as you still enjoy working with them!), thank them for the offer and explain that you don’t accept gifts from vendors.

Good Luck, Happy Holidays and Geaux Saints!

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How Much Are You Paying Your Technology Vendors Upfront?

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Too much? Some of you are thinking, “I don’t pay vendors a dime upfront!”.  Some of you stopped and thought, “Well, I did that before, but I’d never do it again.”  And, some of you said, “Yeah, what’s the problem with it?”

The problem with paying vendors too much upfront is that you lose leverage when the rubber meets the road. When the vendor tells you that the software you paid millions of dollars for upfront is “working as designed” when you know it’s a defect, what leverage do you have? Unfortunately, if you’ve paid too much upfront for the software, you don’t have many legs to stand on.

Now, don’t get me wrong, scenarios where 20% of the contract value is paid upfront isn’t an issue. Tiered payments throughout the contract as the vendor meets their milestones is a great idea and also isn’t an issue.

I’m talking about all or nothing payments up front or large lump sums paid for services not yet rendered or software not yet delivered.  I’ve heard of Tier 1 technology vendors commanding over $1,000,000 up front before performing technology services on a $3,000,000 contract. Really? A cool million? For what? First class seats? You better hope you’ve got the GSA rates in your contract or you really will be paying for first class seats!

If you have a vendor telling you that they have to have all fees paid upfront or a very large sum paid upfront for services or software, ask the five why’s to get to the center of that tootsie roll pop. I guarantee you’ll find something fishy!