How to Negotiate with Your IT Vendors

Two things are invariably true in the modern business landscape: technology will play an integral role in operations, and obtaining this technology will require a relationship with vendors and service providers. As such, anyone seeking to run a business successfully must interact with these external parties and enter into business contracts.

This needs to be handled carefully, so while we aren’t offering legal advice, you should follow a few practices before and during the negotiation of an IT contract.

First and Foremost, What is an IT Contract?

An IT contract is an agreement between you and any of your given technology vendors that (generally speaking) will outline a few key elements of your business relationship. This document frequently incorporates the following components:

• The End User License Agreement: This gives an organization the license to use a given service, defining the contract's length and other terms.
• The Master Services Agreement: This defines the services being licensed to the recipient organization and outlines the expectations the licensee should have.
• The Bill of Materials: This outlines any goods and services to be delivered to a client, covering everything in detail.

Naturally, a lot goes into creating this kind of agreement, allowing you to negotiate a better deal. Here are a few tips to help you do so.

5 Ways to Improve Your IT Contract Negotiation Skills

1. Have your goals and requirements in mind.

If you come to the table knowing what you need and expect, you’re already starting off on the right foot. By addressing baselines like these from the beginning of your vendor relationships, you’re putting yourself in a better position for success.

2. Do your homework.

As you come to the table, you should also come equipped with plenty of information at the ready. Look into the vendor you’re speaking with, gaining some idea of their prices and trends in the industry at the time. This data will give you a bit more of a bargaining chip.

3. Seek a mutual win.

One of the nice things about the relationship between a business and one of its vendors is that there’s nothing that says it has to be a one-sided one. These negotiations can benefit all parties involved, especially if examined from a fact-framed perspective.

4. Keep it simple.

An overly complicated arrangement dictating your relationship with a vendor will only make things more challenging… especially at the beginning of your dealings with them. Starting with the basics and growing from there will be more useful to both parties.

5. Take your time.

A good negotiation will usually take longer than you may want to invest, but you should resist the urge to speed through things just to get them done. Instead, make sure that you fully address all of the elements that must be discussed.

Hopefully, these steps will help you negotiate things with your vendors. If you need additional assistance, you can add us to your ranks and take advantage of vendor management where your IT is concerned.

Give us a call at (888) 814-4843 to learn more.