I’ve Audited 6 Years of Elevator Specs—Here’s Why Your Procurement Process Is Stuck in 2020

The Old Playbook Is Costing You

Procurement manager at a 300-person property management firm. I've managed our elevator service budget ($180,000 annually) for 6 years, negotiated with 15+ vendors, and documented every single order in our cost tracking system. I’ve seen the numbers. I’ve seen where the money disappears.

I'm gonna say something that might upset some folks: If you're still using the same elevator procurement and maintenance strategy you were using in 2020, you're overpaying by at least 17%. I've got the data to back that up.

Let me rephrase that: what was best practice in 2020—'get three quotes, go with the lowest unit price'—is actively costing you money in 2025. The industry has changed. The technology has changed. But a lot of procurement processes haven't.

What I Found in the Data

When I compared our Q1 2024 and Q1 2025 spending side by side, same vendor group, I noticed something weird. Our per-unit cost had dropped 4%. But our total spend was up 11%. That math doesn't work unless something else is happening.

It's tempting to think you can just compare unit prices and that's the whole story. But identical specs from different vendors can result in wildly different outcomes. Here's what I found when I dug into our data across 6 years and 180 orders:

• The 'lowest quote' trap: Vendor A quoted $12,000 for a standard maintenance contract. Vendor B quoted $10,800. I almost went with B until I calculated the full TCO: B charged $1,200 for 'emergency call-out' fees (which A included), $800 for 'after-hours' (included in A), and $450 for a 'setup fee' they mentioned in the fine print. Total: $13,250. Vendor A's $12,000 included everything. That's a 10.4% difference hidden in the fine print.
• The 'local is always faster' myth: This was true 10 years ago when service networks were sparse. Today, a major OEM like Otis has a regional service hub that can dispatch a technician faster than most local independents. Our average response time with our local guy was 4.2 hours. With Otis's regional service? 2.8 hours. The 'local is faster' thinking comes from an era before modern logistics and distributed service centers. That's changed.
• The 'newer is always more expensive' fallacy: We were dead set on keeping an old 1990s hydraulic elevator running because 'the new stuff is too expensive.' But after tracking our repair costs ($8,400 in one year for parts and labor on that single unit), the new Otis Gen2 we priced out had a projected 5-year TCO that was 22% lower—even with the upfront capital cost. Seeing the old elevator vs. the new model side by side in our cost tracking made me realize we were spending 40% more than necessary on artificial emergencies caused by aging equipment.

The Three Biggest Procurement Mistakes I See (and Made)

1. Ignoring the 'True Cost of Emergency'

Most procurement RFPs I see focus on the scheduled maintenance price. They ignore the emergency call-out line item. This was a huge oversight for us.

(Should mention: we had a contract that looked great on paper—$9,600 annual. But every single after-hours call was $350 plus parts. Over a year, with 8 emergency call-outs, that added $2,800. We didn't budget for that.)

The 'cheap' option resulted in a $1,200 redo on a gearbox repair when the local guy couldn't find the right parts. We paid for his learning curve.

2. Treating Contract Renewal Like a Commodity

Oh, and here's another one: comparing renewal quotes as if they're all the same thing. They're not.

After comparing 8 vendors over 3 months using our TCO spreadsheet, I built a cost calculator. The biggest factor wasn't the price of a standard maintenance visit—it was the scope of parts included. One vendor included all controller logic boards. Another included only mechanical parts. A third excluded all Otis-specific parts. The 'cheapest' annual contract ended up costing 40% more over the year because of excluded components.

Our procurement policy now requires quotes from 3 vendors minimum, but with a mandatory line-by-line comparison of excluded items. Because I got burned on hidden fees twice before I learned.

3. Underestimating the 'Soft Costs' of Reliability

When we switched vendors in mid-2024, the cost savings were immediate—17% off our annual contract. But the real savings? Our property managers stopped fielding tenant complaints. The old vendor's elevator was down 3-4 times a year for unscheduled maintenance. The new system (a modern Otis Gen3 with predictive maintenance) has had zero unplanned downtime in 8 months.

I can't put a dollar figure on that, but I can tell you the leasing manager says it's worth more than the 17% savings on paper.

What About the Counterarguments?

I know what some of you are thinking: 'This guy just got lucky with one vendor switch. The industry hasn't changed that much.'

Fair. I've been in procurement long enough to know that one data point isn't a trend. That's why I track all our data. Across 6 years and 180 orders, the trend line is clear: the cost of doing nothing (sticking with old equipment, old contracts, old vendors) is rising faster than the cost of upgrading.

Another objection I hear: 'Modern systems are too complex. We don't want to be locked into proprietary tech.' I understand that concern. But the reality is that Otis, as a market leader, has the service network to support that complexity. And the data shows that proprietary tech from a market leader with a deep parts catalog often costs less over the long run than cobbling together components from multiple vendors.

But hey, I'm not saying every old elevator needs to be ripped out tomorrow. What I'm saying is: if your procurement process hasn't been updated since 2020, you are leaving money on the table. The industry has evolved. Your evaluation framework needs to evolve with it.

The fundamentals—reliability, cost, service—haven't changed. But the execution has transformed. And if you're not updating your benchmarks, your benchmarks are getting you beaten.