No matter how often you negotiate software contracts, it never gets any easier. You must ensure the software satisfies your company’s requirements while also ensuring the seller isn’t overcharging or fiddling with the terms of the contract. Software negotiation is a team effort that involves extensive planning, engagement and even a little bit of luck! Negotiations for software contracts don’t begin or end at the vendor’s negotiating table. Before you even meet the vendor’s sales team, preparation begins. Before an agreement is finished, a lengthy process of investigation, talks, and changes must be completed. In some cases, this might take weeks or even months.
Ways to negotiate for Software Discounts
- Create a team for purchasing and negotiating
A great team will go a long way towards ensuring that you sign a beneficial deal during the software negotiation and selection stages. Include colleagues with various business specialities to get opinions on software choices from various business units. Choose the required software features, the budget, the ideal contract term, etc., as a team.
- Carry out extensive research
You can narrow down your selection of providers based on their product offers, price concessions, and many other factors with the help of thorough research. You can use it to examine different vendors’ software pricing models and obtain market information. Additionally, it will assist in identifying vendors’ advantages and disadvantages, marketing plans, USPs, etc. Read consumer reviews on third-party websites to find out what real customers have to say about various suppliers and their products.
- Adaptable negotiating tactics
Support services comprise the technical assistance that software providers offer for its implementation and upkeep, including installation help, help with data migration, product updates, and remote troubleshooting. Negotiate with service providers to receive these benefits for no or little cost. Other assistance options to consider include mobile applications, a dedicated customer service agent, training videos, and neighborhood resources. Most software consumers are frequently motivated by price. Look out for hidden fees, including :
(a) Installation and maintenance costs,
(b) Data transfer fees, and service charges, even though the prices and discounts indicated on vendor websites may appear alluring.
(c) Negotiate with vendors to get a price that covers all or a large portion of the contract period.
(d)As the number of your users grows, look for discounts.
Consider negotiating for lower termination fees, a longer warranty, and reduced maintenance costs. Discuss hidden expenses, such as price hikes at the conclusion of a contract, with your finance team so that you may evaluate goods based on the T&C rather than just the given price. Customers are troubled by the fine print in most T&C papers. It is challenging to understand because of the language’s complexity and the usage of several technical and legal jargons. Many companies buy software as a service (SaaS) online without reading the T&C agreement. Such purchasers run the danger of incurring further charges, losing data privacy, etc. Therefore, during the software assessment phase, you must ensure that all T&Cs are fully disclosed.
- Plan out your negotiations
Your negotiating strength will grow if you plan out the timing of your contract negotiations. Vendors will feel pressure to complete the contract and close their books if negotiations are prolonged toward the conclusion of their quarter or fiscal year. Before agreeing to a contract, give yourself adequate time to resolve any uncertainties or clarify any gray areas. Plan ahead of time when purchasing software to avoid a last-minute scramble. Preferably begin the process 12 months before the conclusion of your current contract.
- Be ready to leave if necessary
Be certain that you are not compromising by being explicit about what you definitely require before signing a contract. If your demands are not met, be prepared to leave. Have a workable backup plan in the form of your next preferred vendor, and be prepared to start fresh talks. You may occasionally need to alter your bargaining strategies or expectations.
Wrapping Up
Make sure your business is ready for the most crucial discussion during the lifespan of your software. To sum up, collect your team of negotiators, comprehend the hidden fees and acceptable contract clauses, and then devise a successful strategy that puts the vendor under further pressure.
