This tactic involves presenting competition as an alternative to the supplier. It works best when you can articulate that a competitor has quoted a lower price for similar functionality. This introduces a sense of urgency and competitive pressure to the incumbent supplier to provide a better offer. Communicate openly about competitor pricing while making it clear that your finance team is focused on getting the best pricing for the renewal.
This tactic focuses on negotiating the removal of the annual uplift percentage that often accompanies renewals. Customers should clearly articulate their planned budget and emphasize that this uplift was not outlined in previous agreements. This tactic proves effective when combined with the argument that many other suppliers provide more favorable pricing for existing customers as they expand their product suite.
Highlight how any increase in usage should come with lower per-unit pricing due to the savings associated with economies of scale. By emphasizing that your company intends to increase usage significantly, you can argue for more favorable pricing structures moving forward. Ensure to ask for future pricing tables to capture this growth and its cost benefits.
This tactic involves asking the supplier to remove any auto-renewal language from the agreement. By putting forth that this requirement is mandated by your finance department, you build leverage in negotiations for favorable terms on renewal. The key is to convey that issues around auto-renewal are serious enough to jeopardize the deal if not addressed.
Leverage the financial constraints and point out that many competitors provide essential security features without additional costs. This can be used to negotiate a discount or even waive the security features offered in your renewal agreement, especially if these features weren't part of the original budget.