Introduction

Given the global economic uncertainty, buyers of outsourcing services continue to focus on spend optimization. Not surprisingly, Everest Group has observed an increased buyer adoption of price benchmarking and a corresponding proliferation in benchmark providers over the last two years.

Though the efficacy of price benchmarking in identifying price improvement opportunities is well established, we have come across several situations where the usage of “off-the-shelf” or “quick-and-dirty” benchmarks failed to provide any negotiating leverage to buyers.

This viewpoint outlines some of the common challenges buyers need to be aware of in order to derive meaningful benchmarks.