In his article, Scotwork focuses on explaining how the total cost of ownership (TCO) analysis is conducted and how the analysis's information can be used collaboratively with other strategies (Scotwork, 2021). The article also depicts how the information gained from TCO analysis can be used in preparing and conducting negotiations between various parties within the business environment. Thomas's article, on the contrary, displays the fundamentals of cost and price analyses in the business world (Thomas, 2021). In this article, the author shows why businesses must conduct price and cost analyses for successful negotiations.
Thomas' objectives include defining cost and price analyses and showing their importance to the business environment. In price analysis, the author notes that the strategy helps identify the best market prices, enabling one to launch an effective negotiation strategy (Thomas, 2021). Through a good understanding of the market prices, one can easily identify the negotiation techniques to use. In essence, one can only understand the market price analysis through the competition comparison. The author also defines cost analysis as a complex process through which direct and indirect costs that lead to the final product or service price are evaluated. Through price and cost analysis strategies, businesses can easily identify the expected expenses, thus selecting the best negotiation techniques (Thomas, 2021). Scotwork, on the other hand, aims at achieving his article's goals by first presenting the TCO approach, showing the importance of engagements in early procurement, and analysis of the balance of power.
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In his article, Scotwork defines TCO analysis as a process involving two steps. The first step involves collecting data based on different supplier offerings, including reliability, price, customer support, and the expected lifetime (Scotwork, 2021). The second step involves assigning weight to all the equipment aspects based on their value and significance to the organization's specific situations. The TCO approach is critical in positioning organizations in better negotiation positions with suppliers, thus enabling maximization of the long-term equipment values and services. Through TCO analysis, organizations can understand all the costs involved in purchasing and handling tangible products. In essence, hard costs include shipping, spare parts, installation, and price costs (Scotwork, 2021). On the contrary, soft costs can easily be overlooked during budgetary planning, and they could lead to the emergence of unexpected increases in costs. The TCO analysis helps companies overcome this challenge by ensuring that all the costs are accounted for, thus removing additional expenses.
Thomas' objectives are involved in educating readers on the importance of cost and price analysis. The article outlines ways through which the cost analysis method can be used in ensuring effective negotiation. The author notes that, in understanding cost drivers, one must identify the direct costs (Thomas, 2021). In this article, the author defines direct costs as elements, profit, or material, which directly influence a product's final price. According to the author, direct costs include fringe benefits, base salary, materials, sub-contractors, and workers. The author also notes that indirect could be critical during the cost analysis and negotiation process (Thomas, 2021). The article outlines indirect costs like those involved in marketing and advertising, legal fees, repairs, rent, insurance, taxes, utilities, depreciation, and indirect labor. In essence, both the direct and indirect costs are critical areas of consideration during the cost analysis and negotiation processes.
The two articles show minimum or no bias from their authors. In essence, the authors use appropriate language and do not focus on convincing the readers. The articles are also presented in factual ways, with the authors citing the sources of their facts, including statistics (University of Wisconsin, 2021). The authors are also credible and not biased because their work is not opinionated but rather factual and reflects the two sides of the study topic.
References
Scotwork, R. W. (2021). Total cost analysis aids purchasing negotiations. Chemical Engineering. https://www.chemengonline.com/total-cost-analysis-aids-purchasing-negotiations/?printmode=1
Thomas (2021). The fundamentals of price and cost analyses. https://www.thomasnet.com/articles/engineering-consulting/price-cost-analysis/
University of Wisconsin (2021). Identifying bias. https://libguides.uwgb.edu/bias
