- February 3, 2018
- Posted by: Taylor
- Category: Our thoughts
We like having options it keeps things fresh and incumbents on their toes. Yet strangely enough the same cannot be said for some organizations, because they are of the mindset if its not broken no need to fix it! Let’s peel this back and examine how such a strategy may be comforting on the surface, but disastrous as cancer if when left in place.
Vendor A has had your business for several years and they are cordial with no major issues of the service or services provided. Vendor B, C and D have been calling on you for awhile and yes we are all busy, so you say things are good and I really do not feel like its worth my time. Now in spite of your loyalty to Vendor A they have kept you with the same plan (Insurance carrier) for several years with marginal increases. You embrace the increases because the cost of change is to expensive and you like the rep for the most part.
Renewal comes around again and this time Vendor A brings in substantial increase and you get upset demanding a justification. What your given is prices are going up and we hate to be the barer of bad news but you need to increase your budget and stomach this increase.
Your reaction is what? As you fume at the audacity of Mr or Mrs who could do no wrong prior to the meeting and now you want to show who is boss right? You scramble to get some options because hey we all want to look like we did our due diligence when presenting to the C-suite our recommendations.
Vendor D saves your bacon with a substantial decrease and your asked why is their pricing model so much less than the incumbent and you really do not have an answer for this.
But we do.
Lack of competition creates a false sense of security and so pricing, service and all of the things that you felt were so great look terrible when bench marked against competitor who has not had the business.
Sadly enough we see this routinely in our business and the amount of money that is loss due to I am not really unhappy is staggering. Everyone wants to challenge the cost of healthcare but no one wants to talk about the enablers of the problem.
That would be in the following order (Insurance company + Brokers relationship with your current Insurance provider+ Your cozy relationship with the Broker = A steady diet of incremental increases + fees + commissions with every major brokerage reporting increased earnings for FY2017.
Just think about all of this the next time you say cost is out of control.
TaylorSolutionGroup is a US Military Veteran Owned Boutique Brokerage.
Out-behaving the competition one client at a time.