Pamila Kew / November 9, 2015

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Pamila Kew / November 9, 2015

Renegotiating Service Contracts

Case Study:   Finding better pricing for Service Contracts   (January 2011)

Our client, a Church with two locations, was paying $700 a year for a service contract for their Avaya Partner phone system.   The maintenance firm was located about 1.5 hours away and very seldom had to make a service call over the previous lifetime of the service contract.   The vendor contract auto-renewed for 3 years if not notified in writing 30 days prior to expiration, and each renewal added about a 15% increase in the annual price.

In the course of our normal analysis, we came across this contract and inquired.   The Church administrator wasn’t really sure what it was and asked us to investigate.   Upon doing the necessary research we were able to ascertain the details from the incumbent company.   We then wrote an RFQ and sent it to local phone system vendors, soliciting bids.   The winning bid, from a local company about a mile away, was for $30 a month.   We asked for a discount to pay annually at the beginning of the year.   The new vendor was awarded the contract for $300 a year on an annual basis for 3 years.   Our client was very pleased that we did the diligence for them which resulted in a reduction of over 50% in their annual cost.   This was in addition to the 50% savings we had already set in place with their recent telecom optimization.

Pamila Kew / November 9, 2015

Saving money with existing suppliers

Case Study:   Saving money on cellular with existing carriers   (April 2010)

Our client, a public school in Michigan with an enrollment of 2,200, was not sure we could save them any money, but their stated objective before signing the agreement with us was that they did not want to change cell phone providers.   They were very happy with their provider and were using the direct connect minutes of their existing carrier as part of their business process, and many staff used more direct connect minutes than cellular.   Add to this the fact that the school was receiving a hefty 25% discount on plans and services because they are a public school.

After our analysis, which they very quickly approved, told them we could save approximately 16%, we began making the changes and after the first quarter audit they were pleasantly surprised that we exceeded the original estimate and were in fact saving them 23%.   Remember, they were already receiving a 25% discount from the provider.

Our results proved that we could do a better job of managing their plans and services than their own, dedicated account rep.   We also saved them on text overages as a few of their employees were texting.   We were able to catch the overages prior to the end of the month when they would be billed, thus saving the school several hundred dollars a month in text overages.   We continue to monitor their accounts on a monthly basis to be sure the current plans are a fit.

Additionally about 6 months after our initial implementation, the school wanted to switch ½ the users to smart phones from another supplier.   We coordinated that switch and had the dedicated account manager from the new carrier arrange for the new phones, switchovers and setting up the original plans for each user.   After 3 months of monitoring usage, we were able to recommend cost savings in the range of 20%.   Additionally, because our client is so busy with their day to day responsibilities, we noticed the “Friends and Family” plan had not been used.   We did the analysis of the top 10 phone numbers called, implemented the changes and dropped an average of 1,000 minutes from their usage all by having the expertise to do this.     Again, this is after a dedicated account manager was already managing the account.   Needless to say, our client is very pleased with our services.

Pamila Kew / November 9, 2015