The Bottom Line

Patrick Goodwin, President

Recent Posts

Always Vigilant: The Potential Cost of Not Auditing Vendor Invoices

Posted by Patrick Goodwin, President on Jan 11, 2018 12:00:00 PM

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Vendor contract management is something that every financial institution (FI) undertakes as part of the cost of doing business. The average number of contracts a bank or credit union may have varies, but it is not unusual to see the number fall in a range of between 100 to 500 contracts on average. 

While every FI is looking for ways to trim costs, many treat vendor contract management as a responsibility that can be simply added to the list of duties held by an employee that probably already has a full plate. The ever-increasing complexity of contracts and the growing number of vendors can make this approach very expensive for an institution. 

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Topics: Vendor Contract Management

Vendor Contract Negotiations: In Pursuit of a Win/Win

Posted by Patrick Goodwin, President on Nov 29, 2017 9:00:00 AM

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While the vendor contract negotiation exercise does not need to be an adversarial one, the chances for a happy outcome are increased when both parties feel they are being treated fairly. In fact, that is the goal of most vendors and financial institutions (FIs) we have worked with. After all, vendors have no future without FIs and FIs have not future without vendors. It is in everyone’s best interest to work toward a deal that meets the needs of all the parties around the table.

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Topics: Vendor contract negotiations

Regulations Are a Fact Of Life: Don’t Let Vendor Contract Management Create More Expenses

Posted by Patrick Goodwin, President on Aug 2, 2017 11:30:00 AM

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The spiraling cost of complying with an ever increasing regulatory burden is possibly the greatest challenge facing US banks and credit unions – it’s not an exaggeration to label it an existential threat for some institutions. However, this threat can be mitigated by utilizing expertise available from compliance and strategic sourcing firms as well as via software automation. It won’t make the regulations go away, but it makes the process more efficient and helps make it less likely that something is overlooked.

Download, Beware of Greeks Bearing Gifts

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Topics: Vendor Contract Management, Vendor Contracts, strategic sourcing, Vendor contract

Never Sign a Vendor Contract Amendment without Vetting it

Posted by Patrick Goodwin, President on Jul 27, 2017 10:30:00 AM

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Vendor contract amendments can seem pretty straight forward – a few paragraphs over a couple of pages that offers some modifications to the master contract that probably represent some improvement to current terms and conditions. The amendment may be perfectly innocuous or it may suggest some material changes. Either way, it is important not to treat this as a "no brainer."

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Topics: Vendor contract, Vendor contract amendment

4 Questions to Ask Your Next Strategic Sourcing Partner

Posted by Patrick Goodwin, President on Jun 1, 2017 9:00:00 AM

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Engaging with a sourcing partner can be an effective means to improve your institution’s bottom line and protect your operations from the distractions that can be created when management must handle such duties themselves. However, it is important to note that not all sourcing management firms are created equal. As with all partners you select, some of these firms will be a better fit with your culture and objectives than others. We suggest asking the following questions before selecting a strategic sourcing partner.

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Topics: strategic sourcing

The Power of the Bid in Vendor Contract Negotiations

Posted by Patrick Goodwin, President on May 3, 2017 9:00:00 AM

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All banks and credit unions rely on third party vendors for products and services to support the backbone of their operations. These relationships are typically governed by long-term agreements and when those vendor contracts are up for renewal, the common reaction is to sign an extension with the incumbent. Assuming service levels have been acceptable, switching costs – especially for anything connecting with a financial institution’s core system – tend to be so onerous that there’s rarely any appetite for the hassle and resource diversion that accompanies a de-conversion.

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Topics: Vendor contract negotiations

Expecting Regulation Reform? What it Means for Your Vendor Contracts

Posted by Patrick Goodwin, President on Mar 29, 2017 9:00:00 AM

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In the weeks preceding last November’s US election, bankers spoke of finding ways to apply common-sense tweaks to the edges of onerous regulations like the Dodd-Frank bill. A few short months later, talk has shifted to an outright repeal of the Durbin Amendment, if not of Dodd-Frank itself. We had expected such efforts to gather steam over the next 90-120 days. However, the general pace of reform has been slow, which will likely mean attempts to streamline Dodd-Frank may not begin this soon. 

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Topics: Vendor Contracts

Effectively Manage Vendor Contracts During a Merger or Acquisition

Posted by Patrick Goodwin, President on Aug 11, 2016 9:00:00 AM

In today’s economic climate, mergers and consolidations of financial institutions are fairly common.  Anyone who has been involved in one knows it is a time of opportunity and critical decisions. So many considerations go into such transactions, most of which legal teams oversee. There are benefits of working with companies offering proprietary benchmarks and experience that goes well beyond the scope of work offered by traditional advisors – bringing an innovative and proven approach that mitigates expenses and maximizes revenue.

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The 7 Most Expensive Vendor Management Mistakes

Posted by Patrick Goodwin, President on Mar 10, 2016 9:00:00 AM

Financial institutions are full of smart professionals—straight shooters who know how to judge character and structure a deal. But even the wisest among them overlook savings opportunities when dealing with third-party vendors.

Pressed for time and facing salespeople determined to sell their services at a premium, these otherwise successful professionals can find themselves at a disadvantage and end up paying for it.

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