Situation:
A global provider of cellular and satellite enabled IoT Asset Tracking, Fleet Management and Industrial solutions hired G2 to support a corporate mandate to drive down cost of goods sold. G2 was tasked with delivering material cost savings on cellular access costs despite the Customer’s major cellular carrier agreements being renegotiated within 12 months of G2’s engagement. Further headwinds were created by the fact that the incumbent SIMs were allocated across three primary Carriers and the threat of loss minimized since a physical SIM swap is required to switch Carriers.
Negotiation:
G2 first compiled an inventory of the Customer’s existing IoT SIM deployments for each incumbent Carrier to gain a detailed understanding of SIM count, monthly recurring and usage-based charges along with utilization trends for Data, Messaging and Voice services. Leveraging its robust benchmark database, G2 quantified the gap to market for each incumbent Carrier and drafted customized RFP documents to close the gap to market. After receiving the initial RFP responses, G2 facilitated subsequent rounds of negotiations using Carrier specific Feedback Letters to address the remaining deficiencies within each Carrier offer.
Result:
The enhanced leverage provided by G2’s benchmark data and executive contacts within each Carriers’ pricing organization delivered robust savings. Costs with the Customer’s largest incumbent Carrier were reduced by 34% over the new agreement term while costs with the Customer’s second largest incumbent Carrier were reduced by over 12% over the new agreement term. Along with pricing, G2 focused on the terms associated with any minimum spend or exclusivity commitments to ensure the Customer has enough flexibility to adjust to the fluid demands of its over 1.5M and growing global fleet of SIMs.