Usually, negotiating at a distance is a matter of circumstance, not choice. Typcially in purchasing you enter into a negotiation already having done some research and knowing what you want. I can't really say I have gotten better results due to distance.
I am not certain who "we" is. However, in a capitalist society, outsourcing is a healthy activity, so long as the outsourcer is focused on total cost of ownership (as opposed to price).
It is far more likely that we are looking at total incremental cost i.e. total expenditures due to the purchase. However, the intent is to look at TCO. I am far more interested in why you aren't certain that we do.
Lean Tip #93 - Build a strong supply chain by conducting joint improvement activities.
A collaborative supplier relationship model is essential for supporting a Lean supply chain. Conduct joint improvement acitivities with the following emphasis:
1. Exchange best practices with suppliers.
2. Initiate kaizen projects at supplier's facilities.
3. Set-up supplier study or work groups.