Procurement fee models

How procurement consultants actually get paid

There are three ways a technology procurement advisor gets paid: you pay them a day rate, they take a margin on what they sell you, or the provider you select pays them a fee. Each one shapes the advice differently, and only one of the three is usually disclosed.

Model 1

You pay a day rate

The cleanest incentive. You engage the advisor, they invoice you, and nothing they recommend changes what they earn.

What it does to the advice. Very little, which is the point. The distortion sits elsewhere: the cost lands before you have any value, so scope tends to shrink to what the budget allows rather than what the decision requires. Advisors on day rates also carry a mild incentive toward longer processes.

Ask: is the fee fixed or time-and-materials, and who decides when it is done?

Model 2

They take a margin on the sale

The advisor recommends a product or service and then sells it to you, or receives a rebate from the vendor who does. Resellers, VARs and many managed service providers work this way.

What it does to the advice. This is the model with the structural problem. The recommendation and the revenue are the same transaction, so the advisor cannot be indifferent to which product wins. It does not make the advice worthless, but it does mean the shortlist is bounded by what they can sell.

Ask: do you resell, implement or operate any of what you are recommending, and what is your margin on it? An advisor who will not answer the second question has answered it.

Model 3

The provider you select pays

You pay nothing. The advisor runs the evaluation, you choose, and the provider you chose pays the advisor a fee.

What it does to the advice. The obvious objection is that it biases the advisor toward whoever pays most, and that objection is legitimate. It is worth understanding exactly how the model is bounded before dismissing or accepting it.

  1. Is there a cap, and is it in writing? Without a ceiling, the incentive is unbounded.
  2. Does the rate vary between the providers on your shortlist? In most arrangements it does, because rates are negotiated with each provider separately. That is the real conflict, and it is the question almost nobody asks.
  3. Do shortlisted but unselected providers pay anything? If they do, the advisor is paid for shortlist length rather than shortlist quality.

How CYBORIUM is paid, specifically

We use model 3, so treat everything above as interested rather than neutral. Here are our own numbers.

Your organisation pays nothing and never receives an invoice from us. If you select a provider, that provider pays us. For managed services the fee is capped at 20% of revenue. For technology it is a 50/50 split. It is ongoing rather than a single payment.

The part most advisors leave out. The rate is agreed with each provider individually, so it is not identical across every provider on a shortlist. That means an incentive gradient exists. We do not think the honest response is to claim it away. The response is to bound it and to make it visible: the cap is contractual, providers you do not select pay us nothing, and we will tell you the rate that applies to any provider we have shortlisted if you ask.

You contract directly with the provider. We sell nothing, resell nothing and operate nothing, so there is no margin anywhere in the arrangement.

The four questions worth asking anyone

Whatever model you are looking at, including ours:

  1. How are you paid, by whom, and is there a cap in writing?
  2. Does what you earn change depending on which option I pick?
  3. Do you resell, implement or operate any of what you recommend?
  4. Will you show me the evaluation criteria before you show me the shortlist?

An advisor who answers all four in a sentence each is more trustworthy than one who says there is no conflict. Every commercial model has one. The question is whether it is capped, disclosed, and pointing somewhere you can live with.

Last reviewed: 7 September 2026