Putting a $ amount on trust

I bumped into a business associate the other day and he was telling me a horror story about a new LMS implementation that went horribly wrong at a large fortune 500 company. Accordingly to him they had an excellent computer systems validation (CSV) team in place and all was going well. Suddenly the company found a cheaper supplier and kicked the first guys out. The new guys came in and didn't know what they were doing and all the wheels fell off the bus. Does this sound familiar? Have you had similar experiences with 'cheaper' low quality vendors replacing 'more expensive' top quality guys and gals?

My associates seemed to be of the opinion that this is happening more and more. Companies focus purely on the $ amount being charged and don't look at the bigger picture i.e. the cost of bringing a new group up to speed, building relationships between team members, additional time spent on project management, policing the quality of the final product etc. Much of these activities can be grouped under the broad label of trust. Can you trust you supplier to deliver a quality product on time and on spec? What dollar amount can you put against that feeling of trust? Is it really worth getting someone new in and not having that trust and security? Is the example I cited a case of shortsightedness or is there more to it? Your thoughts are appreciated.

Personally I have a network of suppliers that I've selected based on both cost and quality. Once they've been selected I consider them as part of my company and I build a long term relationship based on both parties mutually benefiting. Unless their price to quality ratio drastically increases I wouldn't cut the relationship to save a few $'s somewhere else. To me, if it looks too good to be true it probably is. Putting a $ amount on a business relationship built on trust is highly risky and not worth the gray hairs. In my case I am losing hair at a rate of knots, so I have to take good care in this department.