Negotiating Discounts from Distributors and Manufacturers

Author: Brian Rhodes, Published on Feb 17, 2012

In competitive bids, an integrator's threshold between profit and loss can be very narrow with a single point being significant. Sometimes, purchasing large volumes of equipment seems to be the only obvious way to get discounts. In this update, we examine other tactics to successfuly negotiate additional discounts from your distributors and manufacturers.

Here are the six recommendations with details to follow:

  • Ask the 'Regional Sales Manager' (RSM) of the manufacturer who is 'the best' distributor to buy a specific product through.
  • Ask all your local distributors to provide written quotes on the same 'bill of materials' (BOM).
  • Involve your distributors on the front side of all big RFP/RFQ responses. 
  • Take advantage of 'project' pricing programs and discounts.
  • Make it very clear to your RSMs where you stand with proposing their company's equipment.
  • Negotiate with the distributor or RSM to include free manufacturer training into a big sale.

Ask the 'Regional Sales Manager' (RSM) of the manufacturer who is 'the best' distributor to buy a specific product through.

This basically comes down to asking which distributor the manufacturer RSM likes best. RSMs may know which distributors have current promotional deals or buy product the cheapest. Being aware of this information can result in buying at a better discount, but sometimes it is just the RSM trying to 'grease the gears' by throwing business to a favored distributor. 

Ask all your local distributors to provide written quotes on the same 'bill of materials' (BOM).

Distributors will often price match each other. Pick the overall lowest quote, and if they are high on one or two items, let them know 'where you need to be' in order to buy that product through them. However, be prepared for all your distributors to catch wind that you buy this way. It could impact your relationship.

Also, be aware that buying from 'non traditional' security distributors can also yield compelling pricing.  Simply shopping around on the internet can turn up interesting sources of equipment from sources not specifically positioned as 'security distributors'. You might be able to encourage price matching based on those results.  

Involve your distributors on the front side of all big RFP/RFQ responses. 

This way, distributors have time to work their own internal resources to find you the best price/ alternative products/ ready-made kits for you to propose.  Simply making sure that you communicate your project requirements clearly (without the rush of an urgent deadline) can bring surprising pricing results from your distributor.

Take advantage of 'project' pricing programs and discounts.

Get Video Surveillance News In Your Inbox
Get Video Surveillance News In Your Inbox

Even if you are not sure of the final disposition of equipment/quantities for an opportunity, fill out the pricing discount application with enough dollars of equipment and enough differing products to give you enough information of how to build your final quote as details are refined. Even if the final project proposal falls 'just short' of meeting the minimum dollars to qualify for project pricing, you can directly appeal to your Distributor or RSM to honor the discount pricing already extended. 

Make it very clear to your RSMs where you stand with proposing their company's equipment.

If you hate a manufacturer's stuff, tell them so. Be upfront when telling them why. They will work hard to change your opinion, often in the only manner that they have authority: pricing. 

If high pricing prevents you from competitively proposing good equipment, make sure that the manufacturer's RSM understands this.  They may not be able to change things immediately, but this feedback is helpful for them to hear and elevate to the 'upper echelons' of the companies they represent.  Knowledge of your local market may help a manufacturer price equipment in a way that makes you more profitable. 

Negotiate with the distributor or RSM to include free manufacturer training into a big sale.

A common complaint of integrators is the cost of training on a manufacturer's product. Though this negotiation does not directly affect the cost of purchased equipment, it may result the integrator spending less money to install it. Be upfront in telling your RSM that having trained installing technicians will deliver a better end-user experience for that company's equipment.

Comments?

While we have had success with the tactics above, negotiating discounts is certainly more art than science. Do you agree? Disagree? What other tactics do you use?

Comments : PRO Members only. Login. or Join.

Related Reports

Amazon Going To ISC West on Apr 05, 2018
Move over ADI and Anixter? Amazon will not have a booth at ISC West but they will be there meeting with security companies, offering Amazon's...
Forced Door Alarms For Access Control Tutorial on Apr 04, 2018
One of the most important access control alarms is also often ignored. "Forced Door" provides a vital and even critical notification against...
Understanding The 20+ Lock Functions on Mar 27, 2018
While locks can look the same, they may operate in significantly different ways. To make understanding them simpler, widely adopted industry...
'As-Built' Drawings Tutorial on Mar 20, 2018
Closeout documentation can be invaluable for future expansions or maintenance work, and 'as-built' drawings are a key aspect for finishing projects...
Access Control - Restricted Keys Guide on Mar 15, 2018
Not all doors, even in larger facilities, can justify using electronic access control. And even for doors that do have electronic access control,...
Rack Mounting NVRs Tutorial on Mar 14, 2018
Rack mounting recorders is common in professional systems, but manufacturers are making it difficult, with simple design failures causing multiple...
Vehicle Gate Access Control Guide on Mar 07, 2018
Vehicle gate access control demands integrating myriad systems to keep unauthorized cars out. Everything from high voltage electrical, to...
Cellular (4G / LTE / 5G) For Video Surveillance Guide on Mar 06, 2018
In this report, we explain using cellular for video surveillance including: 4G vs LTE vs 5G 4G standards 5G future Advantage: Placing cameras...
Door Position Switches (DPS) For Access Control Tutorial on Mar 05, 2018
Door position switches do not get enough respect. They solve a major problem of access control systems yet are frequently ignored or...
Dynamic vs. Static IP Addresses Tutorial on Mar 01, 2018
While many cameras default to DHCP out of the box, that does not mean you should use it. This may seem basic for some, but those new to the...

Most Recent Industry Reports

May 2018 Camera Course on Apr 25, 2018
Save $50 on early registration until this Thursday, the 26th. Register now (save $50) for the Spring 2018 Camera Course This is the only...
Death Of A Dummy Camera Manufacturer on Apr 25, 2018
5 years ago, IPVM gathered insights from a dummy camera manufacturer, who was then the top selling dummy camera provider on Amazon and 3rd in all...
Hikvision Critical Cloud Vulnerability Disclosed on Apr 25, 2018
Security researchers Vangelis Stykas and George Lavdanis discovered a vulnerability in Hikvision's HikConnect cloud service that: just by...
The Yolo Bro And The Death of Journalism on Apr 24, 2018
There's an old quote: The job of the newspaper is to comfort the afflicted and afflict the comfortable Unfortunately, the opposite is more...
DMP Adds Ring Video Doorbell Integration on Apr 24, 2018
Video doorbells have become one of the hottest items for security systems. After several years with no doorbell, DMP has announced integration with...
Milestone 2017 Financials Examined on Apr 24, 2018
For ISC West 2018, Milestone released ... their financials, touting "strong revenue growth in 2017". However, there were discrepancies with the...
Chinese Manufacturer Kickstarter Campaign Huge Success (EverCam) on Apr 23, 2018
In a week, a Chinese manufacturer's expertly done Kickstarter campaign has received $1.4 million in pledges, an incredible amount for a video...
Favorite Biometrics 2018 on Apr 23, 2018
Biometrics are on the rise, or at least integrator opposition to them is declining, according to new IPVM integrator statistics.   Almost half of...
Dahua and Hikvision Win Over $1 Billion In Government-Backed Projects In Xinjiang on Apr 23, 2018
Dahua and Hikvision have won well over $1 billion worth of government-backed surveillance projects in China’s restive Xinjiang province since 2016,...
Global Real-Time Video Surveillance - EarthNow on Apr 20, 2018
A new company, EarthNow, with backing from Bill Gates, Airbus and more, is claiming that: Users will be able to see places on Earth with a delay...

The world's leading video surveillance information source, IPVM provides the best reporting, testing and training for 10,000+ members globally. Dedicated to independent and objective information, we uniquely refuse any and all advertisements, sponsorship and consulting from manufacturers.

About | FAQ | Contact