Expert Negotiators of World-Class Telecom Contracts

Fortune 1000 Manufacturing Company

Situation: This G2 client was nearly complete in their own negotiations with both the incumbent and other Tier-1 carriers. This multiple carrier RFP was part of a corporate-wide initiative to disjoin three individual business units and form separate operating companies. This formation of independent operating companies would require separate new contract agreements and the potential reduction of revenue to each winning carrier. The challenge would be to maintain and improve the current pricing while committing to only a fraction of the previous spending.

A modicum of savings was earned by this client’s internal negotiators and the leading carrier was informed they had won the business. G2 was engaged to target improvements in the contractual terms and conditions. Further price reductions were not expected.

Upon G2’s Value Assessment and evaluation of the leading carrier proposal, it was obvious that subsequent improvements to both rates and terms and conditions were highly probable.

Negotiation: G2’s knowledge of all industry-wide market conditions enabled the creation of the highly credible leverage necessary to attain aggressive pricing despite the certain decline of revenue commitments. G2 informed all carriers that any previous decisions or considerations were void and that our mutual customer will be receiving a recommendation from G2 following further negotiations and proposal responses.

In less than a week, G2 took over and resumed negotiations. To streamline the negotiation it was necessary to create and distribute new negotiation documents. Revised usage statistics were provided in a format that best assisted the carrier special pricing organizations to evaluate the profitability of aggressive pricing. A formal Carrier Requirements Letter was also presented in order to set appropriate expectations for pricing and contract elements.

Result: The four weeks of supplementary negotiations resulted in an additional 12% reduction of telecommunications long distance expenditures and millions of additional dollars contributed to the bottom-line over the life of the agreement. All contract terms and conditions were also improved limiting the overall liability to the carriers during this client’s period of growth as a separate entity. The commitment structure and amount maximized flexibility while retaining the most aggressive pricing. Finally, more robust Service Level Agreements were formulated to assist in provisioning issues and possible operational loses.

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