[Whitepaper] Innovative Models for Purchasing Public Sector Software

As a public purchasing professional you’ve likely become accustomed to doing more with less, while expectations in both procurement visibility and efficiency continue to grow. The challenges you’re likely facing run the gamut: limited to non-existent budgets, mid-year purchasing needs which don’t line up with budgetary allowances, justifying the expense of sporadically-needed applications, sharing an application while footing the entire cost, unfunded mandates, and applications which only meet some of your needs.

This is where innovative pricing models – developed by software providers who work with small and mid-size schools and local governments – save the public purchasing professional’s day by offering:

• Software as a Service, the most common and user-friendly alternative pricing model for business applications;
• The “Freemium” model, which offers limited-use free products. For some smaller schools and agencies, the free limited-use product may meet many (if not all) of their needs;
• Modular software, allowing customers to purchase features a la carte;
• Following the no-cost model, where businesses who are benefitting from convenience, data, services, etc., are paying rather than the system provider/user (e.g., the local government) doing so;
• An alternative payment model offered by forward-thinking companies in an effort to better serve small and mid-size customers allowing them to pay-per-use;
• Transaction and convenience fees where the user pays a small fee based on a percentage of the transaction value.

As a public sector purchasing professional you can leverage the aforementioned pricing models to increase your purchasing power by:

• Asking software and application providers for an alternative pricing models;
• Using free versions of business applications, which are great for learning. Oftentimes the free, limited-feature version will meet your organization’s needs;
• Asking for pro-rated annual pricing;
• Creating an innovative pricing model, which is shared among all users.

If you’re not already taking advantage of these innovative ways to purchase for the public sector, it’s time to start!