When dealing with Amazon, it's crucial to present other options your team is considering. Highlight offers from competitors, especially if they've quoted lower prices for similar functionalities. This provides leverage and reinforces the need for better terms with Amazon. You may say, 'We are evaluating several options and other suppliers have quoted significantly lower for similar functionalities. Our finance team is very cost-sensitive, and we need competitive pricing to move forward.'
Utilize Amazon's competitive landscape to negotiate better pricing. Communicate that other suppliers are providing competitive advantages that Amazon needs to match or exceed, such as lower rates or additional features at no extra cost. For instance, 'We have found that X competitor offers X% less for comparable services, making it challenging for us to justify a higher spend with Amazon.'
If your organization does consider multi-year commitments, emphasize that such contracts would normally require considerable discounts. This can help offset the initial higher costs with Amazon. You might phrase it like, 'Due to our finance structure, multi-year agreements are only feasible with substantial discounts. We rarely sign multi-year contracts unless there's a compelling value provided.'
If faced with an unexpected rate uplift, focus on negotiating its removal by underscoring budget constraints. You can reference previous agreements where no uplift was anticipated, saying, 'We budgeted based on historical pricing without expecting an uplift. In light of current pricing models elsewhere, we expect to maintain last year's rates to continue our partnership.'
Ensure you negotiate for the removal of auto-renewal clauses, which can lock your organization into unfavorable terms. State that as a policy requirement, your finance team will not approve auto-renewals, expressing, 'To proceed with any agreement, we must remove auto-renew terms to maintain flexibility in our budgeting and procurement.'