Another quote arrives, and it is still above the planned budget. It is tempting to conclude that suppliers are too expensive or the project is unworkable. First, investigate the gap.
These steps help with budget analysis and scope preparation. If a formal procurement procedure is already underway, establish the available actions with the person responsible for running it.
Revisit the original number
Did the budget come from comparable contracts, an early conversation or simply the amount available? Have integrations, migration or a longer support period been added since then?
Check the comparison basis too: VAT treatment, contract duration and included work. In the price database, look for similar scope rather than a matching contract title.
Identify what drives the cost
During preparation, ask suppliers to break estimates into major areas and explain the unknowns. A cost may reflect actual delivery work or an assumption made because information is missing.
Uncertainty about an old system calls for investigation. A large volume of content still requires migration work even if it is described perfectly. These are different problems and need different decisions. Better documentation may reduce uncertainty; it cannot make the underlying work disappear.
Prepare three clear options
One option is the full scope with a revised budget. Another is a smaller first release that states which tasks users can still complete. A third is an investigation stage if the scope cannot yet be defined responsibly.
For each option, show the price, timing, internal workload and consequences of deferring work. Do not present a smaller scope as the same service with a discount. The person approving the budget needs to understand the result being purchased and what the organisation is choosing to leave out.
Every number in this article, plus thousands of other contracts, is in the database.
Open the database