Frequently Asked Questions about Negotiating Vendor Contracts
HOW CAN A CONTRACT REVIEW BENEFIT MY FINANCIAL INSTITUTION?
A regular audit of your vendor contracts, especially if you’ve never had a third-party review, can give you valuable insight into not only significant savings opportunities, but improved contract terms and service upgrades. Also, depending on the type of contract or agreement there may even be increased revenue potential. Overall, for many of our clients getting our expertise provides them great peace of mind when making such important purchase decisions.
HOW EARLY DO I NEED TO START NEGOTIATING WITH MY VENDORS TO HAVE ‘NEGOTIATING LEVERAGE’?
Typically, contract reviews should start 18-24 months before the contract expires. However depending on the type of contract or agreement it could be as soon as 12-18 months prior to the renewal or expiration date.
HOW LONG DOES A RENEGOTIATION TAKE FROM START TO FINISH?
Once we issue a request for proposal (RFP) to a vendor, we give them 30 days to respond. The whole process from start to finish can take about 3-4 months depending on the complexity of the project.
WILL WORKING WITH JMFA TO RENEGOTIATE OUR CONTRACTS CREATE A PROBLEM WITH OUR EXISTING VENDOR RELATIONSHIPS?
To the contrary, JMFA’s involvement helps preserve the relationships you’ve built with your vendors. As an objective third party, we eliminate the discomfort that can come with directly negotiating costs with your account representative. We bring a highly professional approach to the negotiating process and a valuable knowledge of industry benchmarks, for healthy vendor relationships.
WILL THIS BE TIME-CONSUMING FOR ME AND MY STAFF?
Not at all. We take the task off your plate. Our team of experts negotiate with vendors every day and will dedicate their full attention to your financial institution’s best interest. You simply provide our team with your contracts and invoices, and we will present you with the options you need to make the most informed strategic decisions for your financial institution.
WHAT TYPE OF CONTRACTS WILL JMFA ANALYZE AND NEGOTIATE?
Core data processing, debit/credit card processing, ATM maintenance/branch maintenance contracts, EFT network processing, card brand agreements, all telecommunications services (local, wireless, long distance/toll free, internet access, phone system maintenance, etc.), internet banking, item/image processing, armored car agreements, credit reporting for consumer loans, and others upon request.
I AM HAPPY WITH MY VENDORS. DO I HAVE TO CHANGE VENDORS IN ORDER TO WORK WITH JMFA?
No, the majority of our clients remain with their existing vendors but secure an extended agreement with lower prices, better terms and conditions, and higher standards of service. However, if it is in your best interest, we will guide you through a conversion and assist in the tough decision of selecting a new vendor. With our extensive experience, we will compare pricing, terms and conditions, service, obtain references and set up demonstrations to ensure you get the very best agreement for your organization. Learn more about JMFA Contract Optimizer.
Read about some of our client success stories.