Stopping End Users from Shopping Quotes

By: John Honovich, Published on Aug 28, 2012

Nothing is more frustrating to an integrator than spending dozens of hours preparing a design / sales proposal and then having the end user take it and shop it to the integrator's competitors. This practice is increasing, fueled by the ease of sharing across the Internet. Many bemoan it as simply a fact of life. In this note, we look at three practices to help rectify this practice.

The Approaches

We will review each one in order:

  • Charge end users for the design proposal, offer them a 100% credit on purchase of system integration
  • Include terms and conditions restricting sharing the proposal to any third parties
  • Combine these two options together as contrasting offer

Charging

Charge the end user for preparing and submitting a formal design proposal, including camera selection, location, network layout, etc. Often the charge is between a few hundred dollars and few thousand dollars, depending on the scale of the system desired.

If the end user chooses to buy from the integrator who designed the system, the integrator will offer a 100% credit against the system being deployed so the end-user essentially gets the design for 'free'. If the end-user goes elsewhere, the integrator at least gets paid for their design works.

The upside is obvious - it protects the integrator from doing free work. However, the downside can be significant. The end user may simply reject the integrator from the start and find one of the many other integrators willing to do design work for free to increase the chance of winning a deal.

Terms and Conditions Restricting Redistribution

Give design proposals to end users for free but include terms restricting end users from sharing the proposal with any third parties. This eliminates the barrier of having an end-user pay but increases protection for the integrator against being shopped around.

Raising this can be tricky as it is not something a user commonly expects. An integrator could:

Get Notified of Video Surveillance Breaking News
Get Notified of Video Surveillance Breaking News

  • Formal contract: Put it in writing and make the end-user sign. This provides the strongest legal defense but will increases end user fear to commit formally.
  • Verbal agreement: Simply explain and have the buyer agree verbally ('gentlemen's agreement'). While this weakens legal strength, it does set clearer expectations and can encourage the user not to shop. A follow up email from the integrator confirming the discussion can help reiterate the agreement without having to sign legal documents.

Most integrators would be better served with a verbal exchange rather than a signed contract, as it is more likely to be well received and it is imprudent to sue prospects anyway.

The Combo Option

The best approach may be to offer these options in combination, allowing the end user to either pay for the proposal, allowing them to shop it around or to simply agree that they will not redistribute it. What we like about putting them together is that it establishes a clear value for the integrator's design work without forcing the user to pay it. If an end user really wants to shop the design proposal, let them see that it has real value. Encourage the end user to see the design work as a critical differentiator and not something thrown away to get business. Indeed, even the user would be better off as a shoddy, poorly thought out design is likely to cause far more critical problems later.

We believe that many customers are either unaware that this is a problem or, at least, would be more respectful if integrators clearly but politely set better expectations.

Comments : Members only. Login. or Join.

Related Reports

Security Sales Course January 2020 - Last Chance on Jan 02, 2020
Notice: This is the last chance to register for the course. This sales course is customized for the current needs and challenges specific to...
2020 IP Networking Book Released on Jan 06, 2020
The new IP Networking Book 2020 is a 280 page in-depth guide that teaches you how IT and telecom technologies impact modern security systems,...
Avigilon Launches 'Renewed Products Program' on Mar 19, 2019
There are lots of 'pre-owned' cars but pre-owned IP cameras? While such programs are common in other industries, in video surveillance, they are...
Undercutting Partners, Arbitech Sells Millions In Unauthorized Axis on Mar 29, 2019
One of integrator's top complaints about Axis is poor margins. An enterprising, ethically questionable distributor is solving that. Inside this...
Manufacturer Favorability Guide 2019 on Jun 12, 2019
The 259 page PDF guide may be downloaded inside by all IPVM members. It includes our manufacturer favorability rankings and individual...
Axis Will Not Block Resellers on Jun 10, 2019
While Axis generally has strong favorability amongst integrators, the biggest complaint is their channel model, which results in smaller integrator...
Beware African 50,000 IP Camera Contract Scam on Jul 12, 2019
A “Nigerian Prince” scam for the video surveillance market is going around. You, or at least we, could be lucky enough to be the single bidder for...
UTC Really Screwed Up The Interlogix Shut Down on Sep 27, 2019
UTC has made many mistakes in security over the years, however, the shutting down of Interlogix is one of the biggest screwups in industry history....
Axis Cracks Down On Illicit Channel Sales on Nov 01, 2019
Axis has stepped up efforts to crack down on illicit channel sales according to various industry sources, though, Axis denies this. Online sales...
Verkada Salesman Falsely Alleges Competitor Bankruptcy on Jan 02, 2020
A Verkada salesman falsely told a large end-user that the user's VMS provider faced bankruptcy. Verkada management acknowledged the error to...

Most Recent Industry Reports

Hazardous & Explosion Proof Access Control Tutorial on Feb 27, 2020
Controlling access to hazardous environments requires equipment meeting specific ratings that certify they will not start fires or will not...
Motorola / Avigilon Drops ISC West on Feb 26, 2020
Motorola Solutions has pulled out of ISC West 2020 effective immediately, because of coronavirus concerns, IPVM has learned. This is done amidst...
Cancel or Not? Industry Split Over ISC West on Feb 26, 2020
The industry is split, polarized, over whether ISC West 2020 should run or be canceled. New IPVM survey results of 400+ respondents show heated...
Coronavirus Hits Sony, Bosch Says Switch on Feb 26, 2020
Sony's fall in video surveillance has been severe over the past decade. Now, they may be done. In this note, we examine Bosch's new...
Video Surveillance Cameras 101 on Feb 25, 2020
Cameras come in many shapes, sizes and specifications. This 101 examines the basics of cameras and features used in 2020. In this report, we...
Favorite Video Analytic Manufacturers 2020 on Feb 25, 2020
Video analytics is now as hot as ever, driven by the excitement of advancing deep learning offers. But what are actually integrator's...
Latest London Police Facial Recognition Suffers Serious Issues on Feb 24, 2020
On February 20, IPVM visited another live face rec deployment by London police, but this time the system was thwarted by technical problems and...
Masks Cause Major Facial Recognition Problems on Feb 24, 2020
Coronavirus is spurring an increase in the use of medical masks, which new IPVM test results show cause major problems for facial recognition...
Every VMS Will Become a VSaaS on Feb 21, 2020
VMS is ending. Soon every VMS will be a VSaaS. Competitive dynamics will be redrawn. What does this mean? VMS Historically...
Video Surveillance 101 Course - Last Chance on Feb 20, 2020
This is the last chance to join IPVM's first Video Surveillance 101 course, designed to help those new to the industry to quickly understand the...