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The IT Agenda: Move Beyond the Free Lunch

To put that situation in managerial accounting terms, the fixed cost of storage was miniscule compared with the variable cost of labor necessary to provide that storage. So we let users believe that getting more storage would be expensive and inconvenient for them, and somehow they managed to find other places to dump their junk.

But deception probably isn't the best basis on which to run a business. There's a better way to ease the pain all around: chargebacks.

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Ah, Those Dreaded Chargebacks

Sure, chargebacks can be torture. How do you determine precisely what things cost so you can charge users accurately for your services? And how can you assure users that your prices are reasonable when you don't want to raise the prospect of outsourcing to vendor competitors?

Chargebacks are the only way to distribute costs fairly throughout an enterprise. And they can pay off big time once you implement a well-thought-out system and work through the lingering kinks.

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