Long-term contracts are dead - here’s why...
Contracts are about customer service - and in a COVID-19 world, customer service has been pushed into the spotlight as businesses struggle with lockdowns, social distancing requirements and other (varying) regulations. Businesses are customers too. And they are changing the way they engage suppliers - becoming more risk-averse, and more careful about committing to expenditure, like long-term contracts that tie them into products and services.
Says Euphoria Telecom CEO John Woollam: “What if the supplier goes out of business? What if your business needs change? The current uncertainty means businesses need to very carefully consider what they commit to - and why.”In a world where you can change your streaming service provider, delivery service, ride-sharing service or even your bank in a heartbeat, business to business companies are taking a leaf out of the consumer technology book, and offering month-to-month contracts, all in the name of the customer experience.
Here are a few reasons why you should look for a technology provider that isn’t trying to tie you in:
Flexibility - with month-to-month you are not tied into something that may not suit you over the long-term.
Risk - month-to-month contracts mean you can give notice and terminate rapidly if you need to.
Service - the incentive to provide excellent service vanishes once a provider has you tied in.
Choice - you can change providers as your needs change, much like you’d move streaming services.
“Subscription models popularised by streaming services are just as relevant - if not more so - in the business to business space,” says Woollam, “particularly the telecoms sector, which has become a byword for bad service. The same free to leave models that services like Uber, Netflix, Spotify, and the banks use should be the default for telecoms too.
“It’s time the telecoms market adopted an opt-in rather than lock-in approach,“ he argues, “And if your provider isn’t approaching your commercial relationship with your best interests in mind, it’s time to vote with your feet.”