One of the most important factors in the vendor selection process is to develop contract negotiation tactics. A successful contract negotiation simply means that both parties will search for positives that will benefit the two parties in every aspect while they achieve a fair and equitable deal. Business owners need to understand that a contract that benefits both sides will provide a strong foundation to build a long lasting relationship between outsource and the outsourcee.
Here are some helpful tips to help you to effectively negotiate the contract with your chosen vendor:
• You need to explain carefully and clearly all the important prerequisites, terms and of course, conditions.
• You need to provide precise information on what goods and/or services that you want the vendor to provide.
• This is very important: Vendor’s compensation needs to be clearly stated; the total cost, the schedule for payment and financing terms.
• There should also be acknowledgement of the following:
• Effective dates
• Renewal dates
• Completion dates
• Termination dates
• You will also need to clearly identify and attend to potential hazards and liabilities
• Lastly, as an outsourcer, you will need to define and set very realistic expectations for this relationship presently and of course into the future.
Outsourcers sure need to know the difference between what they want and what they actually need. Business owners can do this by reviewing their priorities all through the contract negotiations planning process and they should also do it one last time at the very end. Outsourcers also need to make sure that they ask the hard questions such as “will this be top priority for my business or is it just a nice idea that we have one?” and “How will it affect my company if I do not have it?” Make sure you have what your company needs, and not things that will make you loosen the purse strings unnecessarily.
With outsourcing, you need to understand that it is not all about how cheap the services you are getting are but how good the results are. There is absolutely no point choosing an outsourcing company that will not add value to your business.
It is important that you dot your Is and cross your Ts when you are negotiating a contract with an outsourcing firm – especially if you plan on having a real long relationship with the company.
Daven Michaels is an award-winning outsourcer and author of the book, ‘Outsource This!’ Daven has been honored more than any other individual or outsourcing organization. You can get more information on outsourcing by visiting www.123Employee.com