We seem like we have been in RFP-ville lately….many of our customers are going through the renegotiating process and it is indeed a learning experience. This blog post will be part of a series and offer some tips for before, during and after the process in order to have you avoid some pitfalls you might otherwise plunge down.
First: You’re In Control
This is the only time in a few years when you actually have leverage with the carrier. Take advantage of it and USE IT! We love to do RFPs and really see the results from a job well done. Don’t let the carriers tell you something can’t be improved. It always can, especially if you are willing to do some good negotiating. Laugh a little; trust us, there will be plenty to laugh about.
Second: Do your homework
Learn everything you can about the competition, the industry and offerings to other customers. This is where we really make a difference. As a WEM firm, we see across all carriers and many customers, and while we cannot provide specific data on specific customers or carriers due to confidentiality agreements, we can guide and provide many industry suggestions on what offerings are out there to similar type customers. You can’t believe what a difference it makes just to have us sit at the table and keep the providers honest.
Third: Ask for as much as you can
You won’t get better discounts if you don’t ask for things. Ask for as much as you can, the carriers can only say “no” and will often say OK or counter offer. The good ones will negotiate a clever term or a creative way to give you what you need and also be able to satisfy their finance team requirements. Often it can be all in the framing of the issue. Additionally, there are so many ways to save money on the bill and several buckets carriers can dip into to provide you with creative credits. Ask for them!
Fourth: Know your numbers, then ask for stuff AGAIN
If your corporate budget requires a 20% reduction in spend, make sure to let the carriers know your numbers and how far off they are. Frequently, with a good business case, they can go back to their pricing folks and get stuff if they know it will take “$X”. We had a great relationship with a carrier working on an RFP and we simply said, listen, we need $X to get the job done. It was a significant number, but it was an accurate one and it worked. The carrier came through, got their contract executed and we got a great deal for the customer.
Fifth: Actually read the final documents before you sign them
It will never cease to amaze us how many times the language you thought you agreed to is not the language that ends up on the final agreement. Be sure to read it, get clarification and make ANY changes you believe need to be made to insure your rights are protected.
Finally, HAVE FUN
While this is a long process if done properly, be patient and use the time for reviews and processing to marinate and insure you have deal you want. Then, step back, make sure the changes are implemented and reap the financial rewards.
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