Are You Overpaying Vendors in the AI Era?

Here's what your vendors don't want you to realize:

The expertise you pay them for?

A lot of it isn't scarce anymore.

For years, vendors knew things you didn't.

They put in work and could do things you couldn't do.

Now, AI lets you do a lot of those things without all the experience.

Stuff that needed specialized knowledge and defined systems only takes a prompt.

Plus, AI can do it cheaper and faster.

This doesn't mean your vendors aren't still worth it.

But what you're paying for is changing.

So it's time to start evaluating them differently.

How to Evaluate Your Vendors

Your goal isn't to start cutting vendors.

But you need to understand what you're getting.

And make sure it's still worth what you're paying.

Here's what to ask:

1. Are they being transparent about AI?

Are they telling you how they're using AI on your work?

Or are they charging the same while AI does the heavy lifting?

This is important.

2. Is what they provide still as valuable?

Six months ago, their expertise justified the price.

Today, could someone on your team do 70% of it?

Be honest.

3. Could you realistically bring this in-house?

Could your team handle this with AI tools while keeping up with everything else?

Do they have bandwidth and interest?

Have they built the skills to manage AI tools and iterate?

4. Are you paying for expertise or execution?

If you're paying for expertise, is it still rare?

If paying for execution, is there value in keeping the work off your plate?

It's okay to pay for execution, just make sure it's money well spent.

5. Would renegotiating make sense?

Maybe you reduce the scope, but they keep managing the workflow.

Maybe you shift from retainer to project-based.

Maybe their value is purely execution and that's worth paying for.

How to Move Forward

You shouldn't blow up every vendor relationship.

Most vendors still provide value in expertise, execution, or both.

Just know that partnerships are changing.

What made vendors valuable six months ago may not make them valuable today.

In another six months, it'll shift again.

More specialized AI tools will emerge.

Your team's AI capabilities will continue to grow, too.

The vendors worth keeping will adapt with you.

They'll be transparent about how AI is changing the work.

And will guide you through this transition.

The ones to be concerned about are the vendors who act as if it's business as usual.

What if you're a vendor to someone else?

Your clients are asking the same questions about you.

Instead of hiding how you're using AI, be transparent about it.

Show them how AI makes your work better or more valuable.

Then price accordingly.

Vendors who succeed won't be the ones pretending nothing changed.

Your team can do more than you think.

The 5-Day AI Advantage Challenge builds the iteration skills and judgment your team needs to handle work you're currently paying vendors for.

See What Your Team Can Do →