By Exceed Group on Jan 1, 2019 8:00:00 AM
As your corporate wireless contract comes to a close, it may be tempting to renew the same terms for another cycle. This is especially true if you've had a favorable relationship with your vendor. But by doing so, you are missing an enormous opportunity to reduce operating costs, improve service level agreements, update termination rights, and much more. Instead, take the time to execute a successful carrier negotiation using these tips.
1. Know Your Contract Dates
A well planned and well executed contract negotiation can take several weeks from start to finish. If you wait until your contract expires to open up discussions with your carrier, you will inevitably end up making concessions. Ensure that you give yourself enough time to properly research, plan, and move through the negotiation process without being rushed. Begin planning roughly 6 months before your contract end date and let your carrier rep know that you'd like to open up contract discussions.
2. Identify Needs and Objectives
As businesses evolve and grow, so do their wireless needs. It's important to analyze your usage and identify areas where your contract may be lacking. For example, if you have seen an increase in international travel, you may want to negotiate for discounted international rate plans to be included in your new contract. If continuous data overages seem to be the problem, then your objective may be to get a larger data pool. A wireless expense management (WEM) system is invaluable for this type of analysis. It allows you to look at usage trends, overages, equipment purchases, miscellaneous fees, and it can even help you identify underutilized features and services. Whether you use a WEM or manually review your data, it's important to identify the needs of your business and compare them to your current contract.
3. Do Your Research
A lot can change in the 2 to 3 years you've been sitting on your contract. It's important to take a look at the current rate plans being offered by your carrier and the other major providers. How do these rates compare to your current contract? What types of promotions are being offered across the board? Don't stop at business plans either, take a look at the rates being offered to consumers. Often times, the aggressive promotions reserved for consumers or new customers can be extended to a business account.
"I routinely see companies using previous contracts as their only point of reference in negotiations. This is a huge mistake." - John Mastro, Mobility Services Manager
4. Don't Be Dazzled By Empty Add-ons
When a carrier offers you discounts and free features, they are designed to give the impression of value. However, something like "free international text messaging" doesn't really provide any value unless your employees travel internationally. The carriers know this and will fill your contract with as much "perceived value" as possible. Don't let these empty add-ons distract you from the features and services you really need.
5. Include Procurement Options
Carriers may offer several different options for device procurement including installment plans, device subsidies, and bulk discounts. Make sure you thoroughly review these options and their effect on the rate plan. Look at the total cost of the device plus the rate plan over a 24 month period to determine which option is the most cost effective. This is also an excellent time to consider upgrading your devices across the board. Negotiate an equipment discount for upgrading all (or some) of your devices and ask for special pricing to continue for the life of the contract on the items you purchase most often. Check the buyback rate for your old equipment and ensure that it is on par with market rates.
6. Leverage an MDM Subscription
Do you utilize a mobile device management (MDM) system or are you considering implementing one? If so, the subscription can be billed through your wireless carrier. This is an additional revenue stream for the carrier and can potentially help you leverage a larger discount. Ask your carrier rep if there are incentives for adding MDM or moving your subscription.
7. Be Willing to Switch Carriers
Changing carriers can be a minor inconvenience at best or a major hassle at worst. Carriers know this and are not as willing to make concessions when they are the incumbent. They are typically more generous when a client can offer an increase in business (line counts) or when they know they will lose your business. Seek pricing from alternate carriers and be willing to use this as leverage when you negotiate. The more lines you have, the more your carrier will be willing to work with you.
Navigating the ins and outs of carrier contracts is a complex process, so don't be afraid to seek expert guidance when appropriate. Industry experts can help ensure your contract is flexible, includes proper "out" clauses, and provides terms that are favorable to your business. If you'd like to discuss Exceed Group's contract negotiation services, please call us at (630) 832-4950.