Due to the fact that managing and controlling maintenance contracts with different providers can be difficult, enterprises tend to not focus on negotiating best prices for support and maintenance contracts. In fact, according to a recent Gartner report, maintenance costs swallow 15% to 25% of total enterprise IT budgets, and network managers must constantly reduce and control these expenses. To help decrease these wasted expenditures, Gartner has identified four solutions that can be applied to all types of networking equipment.
Negotiate Maintenance Contract Pricing With Equipment Purchase Pricing
Since enterprises often apply less diligence to price negotiations for maintenance contracts than they do to the purchase of network equipment, Gartner recommends that enterprises negotiate their support and maintenance contracts when purchasing network equipment. Once the vendor has been selected and the hardware has been purchased, it will require support and maintenance, however at that point, enterprises have little leverage, allowing the negotiated support/maintenance discount to be served as the basis for future negotiations.
Ensure Appropriate Maintenance Level for Network Equipment
Consider how critical each piece of equipment is to your business and assess the risk of having a lower level of service (if any), since not every device requires the same level of maintenance. Gartner recommends that enterprise have an updated network documentation and inventory record (like CloudCover), which identifies the maintenance service level for each network component. Based on extended (i.e. discounted) pricing, one year of maintenance typically accounts for 5% to 10% of the initial net purchase price for routers and switches and 15% to 25% for ADCs and WOCs.
Centrally Manage Your Maintenance Contracts
When dealing with a large variety of network devices on many contracts, each having separate vendors and expirations dates, its important to have a place (like CloudCover) to centrally manage all this information. An up-to-date, accurate inventory is crucial to creating a successful maintenance strategy and avoiding problems caused by unforeseen coverage gaps.
Take Advantage of Limited Lifetime Warranties
Although organizations can expect reduced support and maintenance costs as a result of limited lifetime warranties, they should examine the details of these warranties to determine whether they actually reduce their lifetime support and maintenance costs. It's also important to carefully examine "the fine print" about what is covered on these often-limited lifetime warranties. Make sure to evaluate the impact that a prolonged failure will have on the network to determine the importance of an extended warranty.
With CloudCover, users can manage all the above-mentioned strategies on a single interface. Use one interface to view all contracts, reseller, and maintenance vendors. Use one interface to place all service requests, track all service activity and measure overall performance. CloudCover is the solution to reducing the constant battle of network equipment maintenance costs.