On Premise CRM Buying Tips

By Jelani Harper
Updated: May 13, 2011

There is a definite shift in consideration for the purchasing of an on-premise Customer Relations Management system, as opposed to that of the hosted, on-demand variety. The nature of the on-premise product, which is entirely housed and operated on a company’s own property, requires a greater regard for a business’ in-house information technology team. Additionally, the significant difference in cost between the two types of CRM products—hosted CRM are paid for in relatively low monthly installments while the purchasing of hardware and software for the on-premise version necessitates a substantially higher initial cost—also places a greater emphasis on the negotiations involved in the actual purchase.

IT Concerns

It’s best to fully evaluate the capabilities of a company’s IT support system before purchasing an on-premise CRM. All facets of installation, operation, maintenance, integration, and hardware and software updates are typically performed by the company itself, unlike the service support plans offered as part of hosted CRM products. Consideration should be given to an enterprise’s present system requirements to ensure that its IT team will be able to implement it with the selection of a particular CRM. Additionally, employers should be aware that both IT specialists and relevant company employees may require training to enable a smooth transition to the new product—how much and how costly it will be, of course, depends upon each specific CRM.

Negotiation

A number of key tips can assist companies in the negotiation of the purchase of an on-premise CRM, which requires a substantial amount of capital to procure and is a significant component of the vendor selection process. In addition to detailed on-site demonstrations from sales representatives, businesses should also seek a trial phase (ideally of both hardware and software) to better gauge how effective it will be for their specific customer relationship needs. Advanced research should enable businesses to determine a CRM proprietor’s standard rate of discount, which should be requested during pecuniary negotiations. A willingness to offer one’s company as a reference may further decrease the initial price of an on-premise CRM, while other points of negotiation should include reduced rates for upgrades and training, as well as for consultant and implementation costs.

As is the case when considering the buying of any CRM, companies are advised to research their own specific needs, prognosticate those for the future, and evaluate each individual vendor based upon its capacity to fulfill those requirements. Product reviews of a company’s history, features and testimonies of other customers should sufficiently provide this information.
 

Featured Research
  • The New 2016 SMB CRM Comparison Guide

    Selecting a CRM system is not easy. That's why our CRM expert has compiled this new SMB CRM comparison guide to provide you with the information you need on the top 40 CRM software solutions available on the market. more

  • How to Get the Most out of CRM

    Studies suggest that 63% of CRM projects fail. But your business doesn’t have to be among the failures. You can see ROI on your investment in CRM by implementing an effective plan. more

  • CRM on a Budget in 2017

    With some businesses spending hundreds of thousands of dollars on CRM, it’s easy to fall into the trap of thinking that you need a hefty budget in order to purchase a quality CRM solution. Not so. more

  • 2017 CRM Buyer's Guide

    Customer Relationship (CRM) software has become one of the most important business tools in today’s world. By allowing you to better connect with new and existing customers, CRM is an indispensable tool for sales teams and customer service teams alike. But with so many choices available, it can be difficult to decide on a solution. more

  • The New 2016 CRM Comparison Guide

    Our new 2016 Q4 CRM Comparison Guide includes all the information you need to make the best purchase for your business. With relevant information on over 40 CRM vendors, you can learn what solution offers the features and pricing you need. more