{"id":"6fdf820a-1ec6-4a57-95ec-a7121617b4fc","shortId":"P8y9sP","kind":"skill","title":"vendor-evaluation","tagline":"Evaluate, select, and contract with vendors and SaaS tools. Use this skill when comparing alternatives, running an RFP, scoring vendors against criteria, negotiating contracts, planning a switch, or assessing a vendor's risk. Triggers on vendor evaluation, RFP, vendor selection, ","description":"# Vendor Evaluation\n\nPick the right tool or service, negotiate fair terms, and avoid the lock-in traps. Stack-agnostic. Applies to SaaS, infrastructure providers, agencies, and any external dependency.\n\n---\n\n## When to use\n\n- Selecting a tool or vendor for a new need\n- Evaluating alternatives to a current vendor\n- Build vs buy analysis\n- Renewal coming up: should we stay or switch?\n- Running a formal RFP or RFI\n- Comparing finalists in a vendor selection\n- Negotiating a contract\n- Assessing vendor risk (financial, security, dependency)\n\n## When NOT to use\n\n- General cost reduction (use `cost-optimization`)\n- Specific contract legal terms (those go to legal)\n- Performance issues with an existing vendor (try fixing before switching)\n- Hiring an agency for a one-off project (lighter framework needed)\n\n---\n\n## Required inputs\n\n- The need (what problem are you solving, what would success look like)\n- Constraints (budget, timeline, integration requirements)\n- Stakeholders (users, IT, security, finance, legal)\n- Existing context (what's already used, what's been tried)\n- Compliance requirements\n\n---\n\n## The framework: 5 phases\n\nA structured vendor evaluation. Skip phases at your peril.\n\n### Phase 1: Define the need\n\nBefore looking at vendors, define what you actually need.\n\n- What problem are you solving?\n- What's the user / use case?\n- What does \"success\" look like in 6 months? In 2 years?\n- What's the budget (range, not just ceiling)?\n- What's the timeline?\n- Are there must-have integrations or constraints?\n\nThe temptation: skip this and start demoing. Vendors are happy to show off; you end up choosing what looks shiny rather than what fits.\n\n### Phase 2: Build vs buy\n\nBefore evaluating vendors, decide whether you should build instead.\n\n**Build when:**\n- It's core to the business (differentiating)\n- The need is so specific no vendor matches\n- The economics work at your scale\n- You have the team to maintain it\n- Vendor lock-in would be unacceptable\n\n**Buy when:**\n- It's table stakes (not differentiating)\n- The need is well-served by existing products\n- The economics favor it\n- The team should focus elsewhere\n- The vendor's specialization beats your generalism\n\nMost teams over-build. The rule of thumb: buy unless there's a strong reason to build. Then question even that strong reason.\n\n### Phase 3: Generate the shortlist\n\nCast a wider net than feels comfortable, then narrow.\n\nSources:\n- Internal team's existing knowledge\n- Industry analyst reports (Gartner, Forrester, etc.)\n- Peer recommendations (other companies similar to yours)\n- Reviews (G2, Capterra; with caveats about review quality)\n- Adjacent vendors you already use (often have the feature you need)\n- Open-source alternatives\n\nCast wide first. Aim for 5-8 candidates. Then narrow to 2-4 finalists for deep evaluation.\n\n### Phase 4: Score the finalists\n\nUse a scorecard. Without one, you'll be swayed by demo theatrics or who has the friendliest sales rep.\n\nScorecard dimensions (weight by your situation):\n\n**Functional fit (40%):** Does it do what you need? Edge cases handled? UX quality. Workflow fit.\n\n**Technical fit (15%):** Integration with your stack. API quality and completeness. Data export and portability. Performance at your scale. Self-hosted, hybrid, or SaaS-only.\n\n**Operational fit (10%):** Onboarding effort. Training and adoption. Documentation quality. Support quality (test by submitting a ticket). SLAs.\n\n**Security and compliance (10%):** SOC 2, ISO 27001, HIPAA, etc., as applicable. Data residency. Encryption at rest and in transit. Access controls and audit logs. Penetration test results (ask). Subprocessors.\n\n**Vendor health (10%):** Years in business. Funding and runway (or revenue if private). Customer base size and similar customers. Public references. Roadmap visibility.\n\n**Cost (10%):** License or subscription cost. Implementation and onboarding cost. Training cost. Integration cost. Opportunity cost (in-house resource time). Switching cost (in case of failure).\n\n**Lock-in risk (5%):** Data export quality. Standard formats vs proprietary. Migration paths to alternatives. Open standards alignment. Contract escape clauses.\n\nScore each finalist 1-5 on each dimension. Multiply by weight. Sum.\n\nThe score isn't gospel. It surfaces the tradeoffs.\n\n### Phase 5: Negotiate\n\nMost enterprise contracts are negotiable. Most aren't negotiated.\n\n**What's negotiable:**\n- Price (multi-year, volume, prepayment, end-of-quarter timing)\n- Terms (payment schedule, renewal terms)\n- Success commitments (training, onboarding, support)\n- SLAs (uptime, response time, credits)\n- Termination clauses (auto-renewal, notice period, data export)\n- Liability caps and indemnity (legal will care about these)\n- Subprocessors and data handling (security/legal cares)\n\n**Common negotiation moves:**\n- Multi-year discount (3-year for a 15-30% discount is common)\n- Volume tiers (commit to higher usage for a per-unit discount)\n- Annual prepayment for a discount\n- Free or discounted onboarding\n- Pilot pricing (trial period at reduced rate)\n- \"Most favored customer\" clauses (if your size warrants)\n\n**What to avoid:**\n- Multi-year lock with no escape clause for material breach\n- Auto-renewal with short notice window (under 60 days; want longer)\n- \"All right, no further negotiation\" stance from the start\n- Signing without legal review\n\n---\n\n## Workflow\n\n### Step 1: Define the need\n\nWrite a one-page brief: what we need, why, success criteria, constraints, stakeholders.\n\n### Step 2: Build vs buy\n\nHonestly answer the build/buy question. Document the rationale.\n\n### Step 3: Generate shortlist\n\nWider net first, narrowed via desk research:\n- Read summaries\n- Skim reviews\n- Look at customer logos\n- Skim docs\n- Skim API specs\n\nEliminate obvious misfits. Land on 2-4 finalists.\n\n### Step 4: Run demos and trials\n\nFor each finalist:\n- Demo with the use case (don't take their default demo; bring yours)\n- Trial period if possible\n- Reference calls with similar customers\n- Pilot with real data if feasible\n\nDon't be charmed by the polished demo. Try it with your real workflow.\n\n### Step 5: Run security and compliance review\n\nCritical for any vendor handling sensitive data:\n- Request SOC 2 / ISO 27001 reports\n- Review their security questionnaire (most have one ready)\n- Verify data handling matches your requirements\n- Identify subprocessors\n\nThis can take weeks for enterprise vendors. Start early.\n\n### Step 6: Score\n\nApply the scorecard. Do this collaboratively with stakeholders.\n\nThe scoring conversation matters more than the final number. It surfaces disagreement (one person scored UX 5, another scored 2: why?).\n\n### Step 7: Negotiate\n\nWith the apparent winner:\n- Open negotiation by asking for terms (not just price)\n- Be willing to walk\n- Run negotiations with #2 in parallel where appropriate (gives you leverage)\n\n### Step 8: Plan the rollout\n\nContract signing is the start, not the end. Plan:\n- Onboarding owner\n- Training plan\n- Migration plan if replacing an incumbent\n- Success criteria at 30, 90, 180 days\n- Renewal calendar\n\n### Step 9: Document\n\nRecord:\n- The decision and the rationale\n- Alternatives considered\n- Scorecard results\n- Negotiated terms\n- Renewal date and notice deadlines\n- Owner of the relationship\n\nThis is gold for the next renewal or the next similar evaluation.\n\n---\n\n## Failure patterns\n\n**Skipping the needs definition.** Demoing first. Buying what's shiny. Realizing 6 months in that the actual need wasn't met.\n\n**Single-source decisions.** Talking to one vendor; deciding. No comparison. Probably overpaying or under-fitting.\n\n**Charisma-driven decisions.** Buying based on the sales rep's likability. The product is what you'll use for years; the rep won't be there.\n\n**Reference calls that the vendor curated.** Of course their references love them. Find references the vendor didn't suggest.\n\n**Glossing over security.** Security review skipped because of timeline pressure. Then a breach. Slow down or accept the risk explicitly.\n\n**Demos that don't match the use case.** Their default demo, not yours. Always do a use-case demo.\n\n**Trial that doesn't simulate real usage.** A trial with synthetic data tells you the product works in synthetic conditions. Use real (or close to real) data.\n\n**Negotiating only on price.** Terms, SLAs, and exit clauses matter more for long-term satisfaction than 5% price.\n\n**Auto-renewal without notice tracking.** Renewal happens; rate goes up 15%. No one was watching. Track renewals; review with notice.\n\n**Lock-in without exit plan.** Tightly integrating into a vendor's proprietary surface. When you want to leave, you can't. Plan exit at the start.\n\n**Multi-year contract for an unproven vendor.** Save the multi-year for vendors you trust. New vendor: shorter term, evaluate after.\n\n**No internal champion.** Tool selected; no one drives adoption. Tool sits unused. Identify the champion before signing.\n\n**Negotiating after a verbal commitment.** \"Yes, we want to buy\" means they have less reason to negotiate. Keep options open until terms are settled.\n\n**Ignoring red flags in security review.** Vendor's security responses are evasive or incomplete. Treat as a no.\n\n**Comparing apples to oranges.** Vendors price differently (per user, per usage, flat). Build a comparable cost model at your scale.\n\n---\n\n## Output format\n\nA vendor evaluation document includes:\n\n- **Need brief:** problem, success criteria, constraints\n- **Build vs buy decision:** with rationale\n- **Shortlist:** 2-4 finalists with brief description\n- **Scorecard:** filled out per finalist\n- **Demo and trial notes:** what was learned\n- **Security and compliance summary:** findings per finalist\n- **Reference call notes:** what customers said\n- **Recommendation:** which vendor, with rationale\n- **Negotiated terms:** what was agreed\n- **Rollout plan:** onboarding, training, migration\n- **Renewal calendar:** with notice deadline\n\n---\n\n## Reference files\n\n- [`references/evaluation-rubric.md`](references/evaluation-rubric.md) - Scoring template with weighted dimensions, 1-5 scale criteria for each dimension, and a worked vendor-comparison 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