Supplier Review & Benchmarking

Telecoms Service & Price Review

Challenge

Our food retail & wholesale client’s 5-year contract for telecoms services was due for renewal the following year. Our client needed to review sourcing options and put in place a new commercial arrangement that gave price savings and improved delivery.

Our client had been in an outsourced networking services contract with the same supplier for 5 years and intended to renew services with the incumbent for 2-4 years, without a full market review and therefore required assurance that the proposed charges were competitive.

Our client also needed to ensure that the contract and associated governance addressed delivery concerns.

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Solution

Compared current charges to like contracts to understand price competitiveness

Identified the price reductions that would be achievable with a new contract

Evaluated sourcing options – extend all services with incumbent, go to market for all services, go to market for a new mobile provider with other services retained by incumbent

Brokered meetings between our client and other clients to discuss in detail experiences with alternate mobile providers

Following decision to extend all services with incumbent, drafted the new contract schedules and led negotiations

Ensured the new contract was agreed and signed by client and supplier stakeholders

Outcome

A two-year extension with guaranteed price reductions

  • Our client signed a two-year extension that guaranteed price reductions of 10% p.a.
  • Charges for all services were brought to market competitive levels
  • Service level (dropped call ratio) for the mobile service introduced
  • Contractual provisions allow our client to move ~ 5% of users to alternate mobile providers with no penalty or increased charges
  • No termination for convenience charges for the mobile service
  • Governance mechanisms simplified
  • Dashboard for ongoing review of mobile service performance introduced
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Value

Annual savings of 10%

A set of contract schedules that align to market best practice and address legacy delivery concerns

The ability to answer questions from internal stakeholders on the competitiveness of charges

Enhanced ability to pinpoint delivery issues as they arise

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