Software Perpetual License Category Procurement Intelligence Report

A changing ecosystem within the End User Software and Hardware market also affects the procurement process, cost dynamics and supplier attractiveness for the buyers of Software Perpetual License. In a bid to differentiate themselves in an overcrowded technology space, suppliers are now focusing on creating industry-specific specialized products. Buyers see this trend as an opportunity to procure more targeted solutions and are developing internal capabilities to identify and leverage innovations in the supplier base.

The supply market has undergone several structural changes including introduction of several new vendors every year, M&As and vertical integration efforts of suppliers. This has resulted in some issues such as erosion of previously established supplier relationships but has also opened new opportunities to onboard new suppliers that offer a solution with better fitment or a wider range of offerings in .

The cut-throat competition in the category is compelling suppliers to go aggressive on their pricing structure and increase their spend on sales and marketing activities. As a result, most suppliers are feeling a pressure on their margins and trying to offer higher margin value added services to have a better control on their profitability.

As market conditions become more dynamic and procurement practices get more sophisticated, category managers need to be cognizant of the best practices that work for their Software Perpetual License category procurement. The report offers a succinct analysis of Software Perpetual License procurement best practices.

For example, Developing a strong understanding of the potential vulnerabilities of service providers can help buyers limit their potential losses and also gives the bargaining power to demand services from more robust measures in the SLA.

It is important for category managers to track and measure the performance of suppliers against a defined set of KPIs that are agreed upon by both parties. Buyers should engage with providers that offer mobile applications and online dashboards to monitor essential performance parameters of the products and services procured.

Transferring to a new supplier can be often costly and can further get exacerbated by instances of vendor lock-ins. Buyers must scrutinize the offerings of service providers for any possibilities of vendor lock-ins and demand client testimonials from service providers to assess such possibilities. Watch out for products/services that are priced excessively low, as they can often result in costly lock-ins.

Software Perpetual License procurement managers also need to proactively identify and mitigate potential risks that can arise in the supply chain or contracts for Software Perpetual License procurement. Some examples include: