Time to negotiate a New Telecom Contract?After reading this article you'll be ready to negotiate that next telecom contract like a seasoned pro. The first steps to successful telecom contract negotiation begins by simply understanding
key areas which most contracts are based.
Sound simple? It is.
Telecom Contracts: Do We Really Need Them?
Businesses sign contracts for all types of telecom services. In fact, you may have contracts in place for local, long distance, wireless, voice and data, etc. Keep in mind that information contained in this article can be applied to just about any telecom contract negotiations.
A telecom service contract is an easy way for a service provider to lock you into a predetermined rate structure and set of conditions for a specified period of time. Having contracts in place makes it easy for a carrier to count customers. Multi-year contracts also help solidify customer base - in other words, they can count on predictable revenue.
Contracts can also be to your advantage as well. Having contracts in place eliminates guess work when conducting routine audits of your telecom services. You'll never be able to verify that your accounts are being billed correctly without using contract terms and rates as a comparison.
The 7 Key Elements Included in Almost All of Telecom Contracts You'll Sign
Listed below are seven common characteristics and elements that will arise when negotiating your telecom contracts. Use them as a "checklist" before you begin. It's best to know what you want before negotiations get under way.
Keep in mind that best deals seem to materialize when there is element of "win-win" involved. Concentrate your negotiations on just two or three critical items that will make biggest difference and have most value to you and your company.
1. Most carriers will combine different offerings to maximize overall volume and revenue. Today more than ever, carriers are fighting to be your one-stop shopping for a variety of telecom services. The fact that they CAN offer you every telecom service, doesn't mean you should follow their advice. Handle one at a time, then see how overall package can be put together for your benefit and maximum savings for your company.
2. All telecom contracts will require a minimum volume commitment. This commitment is usually in terms of pre-discounted revenue per month. Variations could include annual usage, net revenue amounts or total minutes of usage. Determine your level of commitment based on previous months or years. Be aware that there are often additional sub-commitments included for specific service elements. FACT: The more volume you offer carrier, better rates you'll be able to negotiate.
3. All require a minimum term commitment. Two or three year terms are most common, but contracts can be written for shorter or longer periods. Like volume commitments, longer term - better rates. Service providers are usually willing to renogotiate an existing contract , even if only half contract remains. Before renegotiating an existing contract, be sure that there are no early termination penalties or fees in existing one.
