When the Telecom Bids Arrive

The negotiation begins after you receive the bids from the voice and data vendors that are participating in your RFQ.

This is the ninth installment of CarrierBid’s eleven part series on the telecom procurement process.

Don’t choose a leader after you receive the bids back, doing so will reduce your leverage.  You want all the vendors to believe they’re still in the running when you go back to them for better pricing and terms.  Anticipate and plan for multiple rounds of negotiation; build the time to do so in your schedule.

It’s important to be specific with negotiation demands and feedback to receive the best returns.

What to evaluate:

• Price times volume.
• The net price, don’t just focus on discounts and credits.
• Regulatory charges, access charges, admin fees and surcharges.
• Incremental rates for long distance, wireless minutes, voice conferencing, etc.
• Cost to add new circuits, like SIP trunks, MPLS, Ethernet, POTS lines and other more traditional phone and internet services.
• Commitments levels.

What to look out for:

• Non-stabilized rates.
• Staggering terms and multiple commitments – they muddle contract tracking and decrease leverage.
• Vendor mischief – delay tactics, reneging and the introduction of new commitments, terms or fees late in the negotiation.
• Trading cushion for savings.  The carriers will ask for this but relenting will reduce your flexibility and leverage.

The negotiation process is a test of wills – carriers, like AT&T, Qwest and Verizon, are the experts and have the experience – entering the process with a fanciful attitude will cost you.

Working the Voice and Data Vendors

At this point in the process you will want to collect or provide contract drafts.  Compare the rates, revenue and term commitments, discounts and credits on the draft to what was negotiated.  Make sure you address adverse terms in the Service Guide.  If the carrier is amending an existing contract, make sure there are no adverse changes to the terms and conditions you negotiated for.

The telecom procurement process can be arduous and full of pitfalls – there’s no reason to go at it alone – enlist the services of CarrierBid to usher you through the process.

If you would like to receive more information regarding CarrierBid’s telecom consulting and procurement services, please complete the web-form on the right side of this page.