1 - Determine the TCO of this contract for three years. (Show all excel work and formulas)

2 - How would you approach the supplier about reducing the TCO for computers over the life of this contract (describe your negotiation strategy)?

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Exhibit 11.14 COST ELEMENTS Purchase Price (Step 1): • Equipment (Step 2) • Software License A • Software License B Software License C Acquisition Cost: TCO Calculation for One Purchase Option COST MEASURES Sourcing Administration Usage Costs: Installation Equipment Support • Network Support • Warranty • Opportunity Cost-Lost Productivity End of Life: • Salvage Value Supplier quote: $1,200 per PC (Steps 3 and 4) Supplier quote: $300 per PC Supplier quote: $100 per PC Supplier quote: $50 per PC 2 FTE @ $85K and $170K for 2 months 1 PO @ $150, 12 invoices @ $40 each $700 per PC (PC move, install, network) $120 per month per PC-supplier quote $100 per month supplier quote $120 per PC for a 3-year warranty Downtime 15 hours per PC per year @ $30 per hour $36 per PC Exhibit 11.14 COST ELEMENTS Purchase Price (Step 1): • Equipment (Step 2) • Software License A • Software License B Software License C Acquisition Cost: TCO Calculation for One Purchase Option COST MEASURES Sourcing Administration Usage Costs: Installation Equipment Support • Network Support • Warranty • Opportunity Cost-Lost Productivity End of Life: • Salvage Value Supplier quote: $1,200 per PC (Steps 3 and 4) Supplier quote: $300 per PC Supplier quote: $100 per PC Supplier quote: $50 per PC 2 FTE @ $85K and $170K for 2 months 1 PO @ $150, 12 invoices @ $40 each $700 per PC (PC move, install, network) $120 per month per PC-supplier quote $100 per month supplier quote $120 per PC for a 3-year warranty Downtime 15 hours per PC per year @ $30 per hour $36 per PC

Answer rating: 100% (QA)

1 Deter mine the T CO of this contract for three years Show all excel work and formulas ANS WER TC O for Three Years Purchase Price Equipment Step 2 1 ... View the full answer