Wait… Don’t Sign

As a business owner, we understand just how busy you can be. Often times you have to be everything to everyone and more than likely fill many roles. The reality is it is overwhelming at times. But some items in business require you to slow down.  One of those is contracts.

Technology vendors like Gamma Tech Services are always battling the ever changing nature of technology.  If there is a way to provide some guarantee for us, we are all for it.  Contracts are one way that this can be accomplished, but they aren’t always a good deal for the one signing them.

What most business owners don’t realize is that the contract is negotiable and often can be removed completely.  Often if it can’t be removed, it can be used for leverage for lower pricing for a longer commitment.  When you sign the contract, understand that you are stuck with that company for the full length of the contract or pay severe penalties.  Below we have listed the contracts that most businesses are signing and how to ensure you get the best deal.

 

  • Internet (Comcast)
    • Normal Term: 3 Years
    • Negotiate: 1 Year
    • Details:  Comcast Business Class Internet sales reps will try to get you to sign a 3 year contract.  This is easily moved down to a 1 Year.  They will tell you that with a 3 year you can get lower pricing, but the offer is not worth it, and with competition finally entering the market in SWFL through Fiber providers such as Summit Broadband, you don’t want to find out you are stuck with Comcast 2 years from now.
  • Phone Services
    • Normal Term: 3 Years
    • Negotiate: No Contract
    • Details: Most phone services will negotiate their contracts.  We have seen them negotiate in two ways.  One is through lower pricing for a longer term and the second is for a short or sometimes even no contract.  With companies like Comcast, it is a little bit more difficult to negotiate but smaller companies are more lenient.  We find that phone systems are in the middle of great change and reality is you don’t want to be stuck with a phone company that is not providing the service you need.  Be especially weary of VoIP companies.  Remember that with VoIP your phones run over your network and if your network is poor, your phones will be as well.  How does the phone company handle these issues when they happen and will they just point their fingers at your network?  With our product, GT Voice, we don’t even ask for a contract and if we are your IT vendor, there is no finger pointing.
  • IT Managed Services
    • Normal Term: 1 Year
    • Negotiate: 1 Year with Cancelling Fees
    • Details:  IT Managed Services can be a little tricky.  From our prospective, we want to make sure the business is not going to take advantage of us by paying us for 1 month and then cancelling.  We also have significant start up costs that come into play.  Your mileage will vary, but we find that negotiating for a contract with “a way out” is the best model here.  It’s not wise to sign a longer contract in exchange for lower pricing.  Remember, you are buying a service and not a product.  Unlike a product, you don’t have anyway to truly guarantee the level of service will be maintained and having a long contract will only serve as a temptation for low quality service.  We have seen it many times, and the results are not good.
  • Printer Lease
    • Normal Term: 1 Year
    • Negotiate: Up to 3 Years
    • Details:  Your printer lease is a good item to negotiate lower pricing in exchange for a longer term.  Printer technology doesn’t change much and we find that if the company you are leasing from has been in business for a while and has a good reputation, they will continue to provide good or at least adequate services when needed.  In the end it’s the printer that you are leasing and lower pricing can really add up if you print large quantities.
  • Security Monitoring
    • Normal Term: 1 Year
    • Negotiate: Up to 3 Years
    • Details: Security companies are built for subsidizing installation costs in exchange for monitoring contracts.  If you are thinking you want your security system monitored, and you should, then you have little to lose and much to gain.  Negotiate for a longer term, up to 3 years, and get the installation of the actual system as low as possible.  In the end you’ll find that you can save quite a bit.
  • Merchant Services (Credit Card Machines)
    • Normal Term: 1 to 3 Years
    • Negotiate: No Contract, or a smart contract.
    • Details:  Merchant Services companies are notorious for shady business practices.  They promise 1.6% rates and when your bill comes you find out that most of your charges came in at 4% since they were “business” cards.  The moral of the story?  Keep them honest by avoiding the contract when possible, but be strategic.  Sometimes these companies will offer savings on the their terminals in exchange for a contract.  What most small businesses don’t realize is that you can have several merchant services accounts. This means that if you decide you no longer like your current company, you can “switch” by no longer using the old company to process the cards.  Be careful though, as some contracts require a high monthly payment or a minimum processing fee that might take away this option.

Next time you are presented with a contract, stop and ensure you can’t make any changes to the contract before you sign.  It might save you thousands in the end.  Our customers who are a part of our IT Managed Services can and should involve us in any of these negotiations so that we can ensure you get the best bang for you buck combined with flexibility in the the future.