Zero-fee procurement explained. Last reviewed:
Zero-fee procurement means the organisation buying technology pays its procurement adviser nothing. The adviser is paid by the provider that wins the work, so the decision owner receives no invoice. That is a payment structure. It is not a claim that the arrangement has no incentives, and this page sets out where they sit.
What is zero-fee procurement?
A procurement adviser helps an organisation define what it needs, scan the market, evaluate providers and negotiate a contract. In a zero-fee model the organisation is not the one who pays for that help. The provider selected at the end pays the adviser, usually as a capped, success-based fee. Providers that are shortlisted but not selected pay nothing.
How does independent technology procurement work without charging the client?
The work runs in the same order as any other engagement, and only the source of payment changes.
- Requirements are agreed with the client first, ranked with MoSCoW (must, should, could, will not), before any provider is contacted.
- The adviser scans the wider market and scores providers against those requirements, using evidence such as references, certifications and contract terms.
- Pricing is normalised so proposals built on different units can be compared line by line.
- The client chooses a provider and signs the contract directly with it. The adviser is not a party to that contract and takes no resale margin.
- The selected provider pays the adviser’s capped fee. The client does not.
How do zero-fee sourcing firms make money?
From the selected provider, and only if the client selects it. The fee is capped and success-based. The rate is agreed with each provider individually, so it can differ between providers on the same shortlist. CYBORIUM discloses the rate to the client on request. The firm does not build, sell, resell or operate technology.
Where does the conflict of interest sit?
It sits in the fee rate. If one provider pays a higher rate than another, an adviser has a reason to prefer it. A zero-fee model does not remove that. It limits and exposes it:
- The fee is capped, so there is a ceiling on what any one outcome is worth.
- Providers that are not selected pay nothing, so there is no reason to pad a shortlist.
- Scoring weights are fixed with the client before providers are approached, so a late change in emphasis is visible.
- The decision belongs to the client. The adviser records the evidence and the score. It does not choose.
- The rate is available on request, so the client can ask what applies to the provider it is leaning towards.
How does zero-fee compare with other ways of paying an adviser?
Every payment model puts the incentive somewhere. The useful question is where.
| Model | Who pays | Where the incentive sits | What to ask |
|---|---|---|---|
| Hourly or day rate | The client | Toward longer engagements | Is there a cap on hours? |
| Fixed project fee | The client | Toward doing the minimum that fits the scope | What is excluded from scope? |
| Percentage of savings | The client | Toward a lower price, sometimes at the cost of fit | How are savings measured, and against what baseline? |
| Zero-fee, provider-paid | The selected provider | Toward providers with a higher agreed rate | What is the rate for each provider, and is it capped? |
| Reseller margin | The client, inside the product price | Toward the product the reseller sells | Does the adviser resell anything on the shortlist? |
| Software subscription | The client | Toward the platform’s own workflow | Does it cover advice or only tooling? |
What should you ask any procurement adviser, including us?
- Who pays you, and does the amount differ by provider?
- Do you sell, resell or implement anything you evaluate?
- Will the contract sit between me and the provider, or pass through you?
- What happens to providers that are shortlisted but not chosen?
- Can I see the scoring, the weights and the evidence behind them afterwards?
When is a zero-fee model the wrong choice?
When the organisation wants an adviser with no financial link to any outcome at all. A fixed fee paid by the client gives that, at a cost. Zero-fee suits organisations that want market-wide coverage and a documented selection without a separate consulting budget, and that are comfortable asking the questions above. What would change our description of the model: if unselected providers were ever charged, or if rate disclosure were refused on request, zero-fee would stop being an accurate label.
Judge any advice fee against the size of the decision. Gartner forecasts Australian IT spending at A$172.3 billion in 2026, up 8.9 per cent on the previous year, and a single enterprise contract inside that total will usually outweigh the cost of testing it properly. Value for money is the core principle of the Commonwealth Procurement Rules, and the ANAO has repeatedly found that entities fall short on documentation rather than on price. A payment model is worth choosing if it leaves a record you can defend.
Sources
- Gartner Forecasts IT Spending in Australia to Exceed $172 Billion in 2026, Gartner, September 2025.
- Commonwealth Procurement Rules, Department of Finance.
- Procurement and contract management, Australian National Audit Office.
Where to read more
- What is procurement as a service?
- How to engage an independent procurement service
- Procurement as a Service
- the honest answers on hidden costs
- How the CYBORIUM method works
Zero-fee procurement in short
Zero-fee procurement changes who pays the adviser, not whether incentives exist. The client pays nothing, the selected provider pays a capped fee, and the rate is agreed with each provider and disclosed on request. Treat zero-fee procurement as a payment structure to be tested with the questions above, not as a promise that no conflict exists.
Want this applied to your own shortlist? Get the Procurement Readiness Brief or tell us about your project. The client pays CYBORIUM nothing and chooses the provider.
Frequently asked questions
What is zero-fee procurement?
It is a model where the organisation buying technology pays its procurement adviser nothing. The selected provider pays the adviser a capped, success-based fee, and providers that are not selected pay nothing.
Who pays CYBORIUM?
The provider the client selects. The client does not pay CYBORIUM and receives no invoice. The fee is capped, the rate is agreed with each provider individually, and it is disclosed on request.
Is the fee the same for every provider?
No. The rate is agreed with each provider individually, so it can differ between providers on a shortlist. That is why scoring weights are fixed with the client before providers are approached.
Does the adviser choose the provider?
No. The client chooses and signs the contract directly with the provider. The adviser records the requirements, the scores and the evidence.
Does zero-fee mean there is no conflict of interest?
No. The incentive sits in the fee rate paid by the selected provider. A cap, a no-pay rule for unselected providers, pre-agreed scoring and disclosure on request limit and expose it.
