Cutting costs has become a major priority, especially in today’s economy. If you haven’t done so already, one way to easily cut costs is to revisit your telecommunication expenses. Telecommunication expenses can be anything from telephone expenses to Internet connectivity to equipment. If your contract with your current telecom provider is about to expire, you should take this opportunity to re-evaluate your expenses.
60-90 days prior to the expiration of your contract(s), reach out to your current vendor(s) to see if you can negotiate reduced pricing. If you cannot, you should consider looking for a new one altogether. You want to make sure you have enough time to evaluate each new vendor and their rates for services without feeling pressured. Remember, if you do decide to switch carriers, you will most likely have to provide notice of termination to your current vendor.
Before you begin, make sure you have the following information available and are also familiar with it.
1. When does your contract expire? As mentioned above, you want to start your process about 2-3 months before your contract expires. This will help you get the most price reductions. It may be a bit difficult to get a provider to reduce charges during a contract term, but as you get closer to the end of your contract term they may be more willing to negotiate rates to keep you as a customer.
2. Does the contract auto-renew, and for what term? Is important to know if your contract has an auto-renewal clause and what it entails. The auto-renewal could be short term, such as month-to-month, but it can also renew at whatever the initial term was. If you do choose to change providers, be sure you fully understand the auto-renew policy in your contract to avoid early termination fees.
3. What services are you currently purchasing, and from how many providers? When speaking with your current vendor(s) you want to have some understanding of what you services you are subscribed to and whom you are purchasing from. Many times you can get all your telecom services from one vendor and at a discounted rate.
4. What are you currently paying today for your services (this includes fees and surcharges)? When seeking a reduction in costs, you have to know where you are starting from. In addition to the actual price for a particular service, it is important to consider what additional fees and surcharges you are paying as well. What you are saving in price with one vendor you could be paying in surcharges and fees, and as a result, making the overall cost more. If you are unsure of a fee or surcharge, ask your vendor.
5. Do you need to keep all the services? Have a look and make sure that you need everything you have. There may be services that you no longer need and can cancel. Any good provider will offer you a free analysis of your business needs.
6. Do you need additional services, or need to change the type of service you have? One service to look at is Internet bandwidth and making the move from switched to dedicated services. With the growth of IP, have a look to see if you need to upgrade your bandwidth. Contract renewal time is always a good time for an upgrade; vendors like to see this type of growth. If your business has grown and you currently have switched services, you may want to consider switching from switched services to dedicated services. Dedicated services, even though they have an access MRC, tend to have lower rates.
Once you have gathered all of your information, your first step would be to contact your sales representative from you current vendor. If you are unsure of who your sales representative is, or how to contact them, you can contact customer service.
Once you have reached the appropriate person, explain to that them that you would like to discuss renewing your contract and you are also looking to reduce your currently monthly spend. They may ask how much you are looking to reduce your cost by, so be prepared with an answer. If you are not sure, asking for 10% - 20% reduction would be a good place to start.
The sales rep may ask what term you are looking to sign for. Normally, the longer contract you are willing to agree to, the better pricing you will be able to get. If you believe that in the short term, you are going to need to order additional services, even if they are with another provider, you should discuss that with them as well.
After your current vendor has given you some information, take time to evaluate it. If you are not happy with what they have given, see if they can do anything more. You can also start to price out competitors to see if they can beat your current vendor’s price. Don’t forget to consider fees and surcharges.
When contacting a new potential vendor, make sure you have all your information, including copies of your previous bills. The more information you can give a potential vendor the better they can understand what you need, and therefore can put together their best offer.
The key to getting the best deal is to simply ask. It never hurts to ask about a rate, charge, surcharge or fee. The worse thing they can say is no, but you may be surprised on how often they say yes.