Wednesday, October 15, 2014

Tips from an industry insider: Black and White is Not So Black And White. The Dark Side of Conferencing Invoices and Contracts.

I got a phone call a few months ago. It was from a perspective customer and as expected, he was curious about Optelcon, but guarded. This CIO was wondering if we could really save them the kind of money that he'd heard about.
He wanted us to review their $40,000 in conferencing expenses to see if we could find any savings that their internal auditors had not been able to find. They'd apparently gone through their invoices with a fine-tooth comb and couldn't find any discrepancies between their invoices and the per-minute rates that were in their contract. Still, he was surprised that the service was costing so much more than he'd initially hoped.
I felt confident we could help.  With our last 12 global enterprise clients engagements, where we've been called in to audit and analyze their conferencing records, we'd been able to save them 53% to 86%--most often by their next billing cycle.
I asked him if he knew that conferencing companies offered a second billing portal where customers could download the raw data of their phone usage?  That's where Optelcon does the detailed analysis with our rate engines and proprietary analysis methods. At this point, I could almost feel him leaning forward in his chair. You see, most businesses only review the summary reports that are easily available from the conferencing company's main billing portal. Companies don't know about this second portal. And this "convenience" the conferencing companies offer doesn't allow for the detailed analysis that's required to really figure things out.
After we've gone through the invoices--with our hundreds of years of collective experience at doing this type of analysis--clients literally can't believe how much we're able to save them. We've had the opportunity to see thousands of vendor invoices, contracts and RFP proposals. So we're experts at this. Regardless of how much time is still left on the contract term, we still consistently help our client's reduce spend. 
Clients really feel good about having us on their side of the negotiating table.
After our call, this client went into the billing portal and sent us one of the only available billing reports. Sure enough, the per-minute charges agreed exactly with their contracted rates. But what clients don't often realize is that there's a line on the bill called "TOTAL TAXES AND FEES" that can add up substantially. In the case of this client, this line alone was more than 70% of their monthly bill. This is where we dig in. We sometimes see that the client is using a service that isn't part of the contract and so it gets billed out at the company's "standard" and often most exorbitant rate. Sometimes, buried in the 90+ pages of pricing schedules and surcharges that often accompany the contract is a note about minimums. I've seen $15 per-call minimum charges that are often more significant than the per-minutes charges.
As with so many of our other clients, when we combine 100+ years of experience with the most granular level of billing detail we lowered their monthly conferencing bill from $40,715 to $14,926; a savings of 63%.
In the next blog, I'm going to go through some of the numbers in detail, so you can see exactly where the savings came from. I'm also going to give you a few other suggestions on things you can do to save yourself some real money when it comes to conferencing.
In the meantime, if you have a minute and want to give us a call, we can go through the types of services and savings that Optelcon can provide. You can also enter your information in the "Contact Us" fields at the right.
If you're not ready for that just yet, I'd suggest that you subscribe to our blog if you've found this piece to be helpful.
A final note about this client. He, of course, was pleased with the work that Optelcon had done for them, but I think one of the surprises that he and other clients often see is that just because the contract appears to be black and white, it doesn't mean that it's really black and white. In this case, the addition of fees and surcharges dwarfed the agreed-to per-minute changes.
Until next time,