Voluntary Benefits supplement 2004: Negotiation – Do-it-yourself discounts

Do you want to offer champagne benefits on a beer budget? You might even want to dip a toe in the world of voluntary benefits yourself before shelling out for a specialist provider, or add some locally flavoured discounts that your national provider can’t.

Whatever the reason, by brushing up your DIY skills and negotiating deals directly with suppliers you can liven up your benefits package – without spending a penny.

But first, a word of caution. Whether you go through a provider or arrange the deals yourself, two golden rules apply. It’s vital to research the kind of benefits that would appeal to your staff and ensure that suppliers are reputable and financially sound.

Karen Edwards, a director at benefits provider Personal Group, says: “It is important that employers make sure that they’ve got an understanding about the service levels the supplier has to agree to and that they understand the procurement process providers go through.”

So how do you go about cutting out the middleman and wangling your own voluntary benefits? Your first move is to stretch out your negotiating muscles and pick up the phone. Or, “ring and beg”, as Jo Bayliss, work-life balance co-ordinator at Shrewsbury and Telford NHS Trust, puts it.

The Trust has secured a number of voluntary benefits for staff, including money off of childcare and discounts at local restaurants. “We just ring them and say ‘would you be prepared to give staff a discount?’,” she says. Matthew Ansell, Bringme’s head of marketing, agrees that a bit of canny wheeling and dealing can yield results. “Go armed with the facts,” he says. “Suppliers will want to know how many staff are going to be interested. The tip is to know who you are going to communicate the offer to; what the take up is likely to be; how quickly you are going to communicate it; and how you are going to deliver it. That’s the best way to get a good deal. If you can prove to the supplier that you can get them what they want, then they’ll do it.”

Other employers take advantage of existing business relationships to get their mitts on generous discounts for staff. British Airways (BA) offers employees a range of voluntary benefits, including financial advice, discounted entry to theme parks and, of course, cheaper holidays and flights. “Most were arranged one-to-one with myself or people from my team meeting with potential providers,” says Chris Hunt, a reward manager at the airline. “But some of them are through companies coming to us or through relationships we have with external companies, on a business footing. We’ll know something about them if we do business with them.”

However, Hunt is firmly against you scratch my back, I’ll scratch yours arrangements. “It’s not done on that basis of us getting some sort of benefit back out of it. Many employers from many other companies have said ‘how about something quid pro quo’? Obviously they are after discounts on travel and that’s not the market that we’re in.”

BA is a member of the Benefits Alliance, a group of community-spirited blue chip employers which use their bulk-buying power to get deals for staff. A similar club, the Charities Buying Group, exists for voluntary sector organisations.

Joining such groups can be another effective way of putting benefits in place and still avoid using a provider.

However you put your benefits together, NHS’s Bayliss recommends keeping things simple: “We try to do things that don’t have a high workload and won’t be complicated to put in. We don’t want them to be too complicated for staff either. They have to be able to just flash their card and get the discount.”

All this is fine, but can these do-it-yourself discounts really offer the same value for money as schemes from voluntary Goliaths such as Bringme and Youatwork?

Sally Ward, reward manager at retailer Dixons, says: “You can get slightly better [discounted] deals [from specialist providers]. They have got the buying power that we just don’t have. I wouldn’t say the discounts are hugely better [though], only slightly.”

Top tips on sourcing suppliers
• Get inside information – try to get advice from other organisations that have put in similar benefits.

• Get web wise – scour online directories for suitable suppliers. Check out the Department of Trade and Industry website for details of Regional Supply Offices and other government bodies that may be able to assist.

• Keep your suppliers close – hone your negotiation and communication skills. Build relationships and don’t just contact them when things go wrong.

• Join forces – get together with other employers to form a consortium and boost your buying power.

• Think smaller – it isn’t always the large, well-known names that are on employee’s preferred supplier list. Again, do the research and find out what the possibilities for your future scheme are.

Source: The Chartered Institute of Purchasing and Supply