7 Steps to Find a Great Vendor in Software Development

An average IT company spends on vendor payments from 30 to 60% of its budget.

This means that choosing a vendor in software development is the point that requires special attention and detailed choice.

In fact the success of software is directly connected with how effective your vendor is.

So if you want to find a vendor company which would not only care about its profits, but also conduct some market research and sales analysis and support the interests of your IT company, you’d better use a systematic approach.

As you probably understand getting a good vendor is not an easy thing to do. So here are the steps need to be taken.


1. Get as many details of the project as possible

First and foremost one should get a clear picture of the project scale, software functional requirements, additional services and future prospects.

Remember that to get what you want, you need to know what you want. This rule is relevant not only for choosing a vendor, but also for many other business situations.


2. Create a team

Once you know what you need, it’s high time to create a team, which would be choosing a vendor. Make sure to include in it people, who know the product from different angles: development, strategies, marketing etc. Make up the list of priorities and plan the budget you are going to spend while choosing the vendor.


3. Make the list of the possible vendors

 There are 3 main ways to find a vendor: 

  • Ask your friends or business partners for referrals. Remember you are not the first person looking for a vendor. If you know people who already have had positive experience using the services of the vendor, this might work the same way for you. But don’t rush with conclusions, just put the recommended vendors in your candidate list.
  • Use the databases of trade associations. This variant is good for those who like to work with high-class professionals and is ready to pay for it. Vendors from such associations will probably cost you more, but you can expect more efficient result from them.
  • Just google them. Today there is almost no information you can’t find in Internet. Use search engines to expand the list of the candidates.

4. Conduct the first stage of selection

 To make the list of candidates shorter it is advisable to gather information about the following details: 

  • How experienced the company is
  • How much would it cost
  • Size of the company
  • Competitive advantages

This can be done by phone or e-mail. Eliminate unsuitable companies and continue the selection. 

Choice word in a dictionary under magnifier


5. Conduct the second stage of selection

By this step you should have 5-6 possible vendors left. Meet with them and discuss: 

  • Your viewing of the software promotion
  • Support duration
  • Your priorities and needs
  • Technologies used by the vendor
  • Financial security

Make sure to ask for the samples of work, so as to have a better picture of the experience the vendor has. After this step cut the list down to 2-3 vendors.


6. Make up request for proposal (RFP)

Request for proposal is aimed to give as much information about your candidates as possible.

Feel free to include in the list all questions you are interested in. Typical points are:

  • CV of people, who are going to work on your project
  • List of clients and references
  • Licenses and certificates
  • Business plans
  • Contact data
  • Other specifications

This would help you to learn more about your future partner.


7. Choose the right vendor

Once you have all this information you can pass to selecting the final candidate. Make sure it will perform good requirements and progress tracking and allow frequent releases.

And final advice: don’t start with big projects. Just give the final candidate a test one to know whether you can trust him or not. And if everything is fine, continue your cooperation.


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Peter Kudlacek

Peter Kudlacek


Peter Kudlacek is a CEO at Apro Software . He has been in software development business for the last 15 years. He succesfully built several IT companies.