We've all heard the Biblical story of David, whose well-aimed stone brought down the giant Goliath.
When negotiating telecom services, small companies armed with powerful negotiating techniques can do as well or better than their larger counterparts. Here’s how:
Know what you have and what you need. Whether it’s excess phone lines, unnecessary features or too many shared mobile-plan minutes, most companies pay for services they don’t need. The solution: an audit. Review contracts with service providers or a third party to understand what you are paying for. For example, most businesses can function with a ratio of one line for every three employees. Internet providers can provide traffic studies to ensure that the bandwidth you are purchasing is being utilized.
Scrutinize services. Carriers love to sell emerging services like hosted voiceover Internet that are margin-rich and tie the client more closely to the provider. Sometimes basic services get the job done for less. Ask whether the service will: 1. Improve the customer experience; 2. Increase efficiencies and/or productivity; 3. Reduce costs. If a carrier can’t give you a “yes” on at least two of these, you probably don’t need the service.
Be willing to walk. Ever negotiated for something in a foreign country? You thought you got a good deal at 20 percent off, and then discovered another traveler got the same item for 70 percent off. How? The sharp negotiator probably started with an absurdly low offer and started to walk away at some point in the deal. Telecom isn’t much different. Usually, all services are negotiable. Compare quotes from three sources. Ask for free features, free equipment or free months of service. Keep pushing until the carrier says no at least three times, and then walk. The offer they come back with then is usually their best.
Leverage. In negotiation, the person with the most information usually wins. You need benchmark data on what others are paying for the same services to negotiate from an informed position. Many telecom consultants have this type of data based on the multitude of clients they represent. I’ve never gotten a carrier to pay a customer, but I’ve been able to negotiate lots of free stuff based on knowing the precedent a carrier has set with another client.
Telecom savings negotiator Sean Fox is owner of a Cincinnati-based franchise of Schooley Mitchell Telecom Consultants. Schooley Mitchell is the largest independent telecommunications consulting firm in North America with over 10,000 clients. The company is not affiliated with any telecom carriers and leverages that objectivity to save customers an average of 28 percent with no up-front costs. Learn more at TeleCommunicationsNegotiator.com.