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Would you give a 5% price reduction to renew a contract?

Discussion in 'Business Operations' started by Toro 455, Jan 21, 2013.

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  1. Toro 455

    Toro 455 LawnSite Member
    Posts: 238

    That's what the letter in front of me says. To quote it goes like this:

    ""Our company has recently merged with CPG International. As a result we are undergoing a cost reduction program. As part of this program, we are examining all of our expenditures and analizing each of our strategic vendor relationships to identify opportunities for improvement.

    Our relationship with you has been identified in this process and is currently under review. We request that you reduce pricing by 5% on all future transactions."


    Would you go for it? I did! E-mailed them back today with an "OK I'll do it."

    I figure 95% of something is a heck of a lot better than nothing!

    Are you seeing request like this?
     
  2. grandview (2006)

    grandview (2006) LawnSite Gold Member
    Posts: 3,466

    Fishing,that's what they are doing.
     
  3. KS_Grasscutter

    KS_Grasscutter LawnSite Gold Member
    Posts: 3,331

    If it was something that accounted for 25% or more of my income I'd probably go for it, but otherwise not a chance. Most of my customers will be getting a 5% INCREASE this year. How much does it cost you to buy a Baconater value meal compared to this time last year?? Everything is going up. I'm guessing your 5% reduction of income is actually a reduction of nearly 10% of the buying power of the money from that account compared to last year.
     
  4. Mustang

    Mustang LawnSite Member
    Posts: 36

    Only if they reduce services received equal in value by 5%.
     
  5. jsslawncare

    jsslawncare LawnSite Bronze Member
    Posts: 1,674

    5%, yes I would too. Cause I know I'm 110% over priced.
     
  6. dieselfuel

    dieselfuel LawnSite Member
    Posts: 114

    Yes, I'd give 5% discount - with 5-10% less work done on the property.
     
  7. slowleak1

    slowleak1 LawnSite Senior Member
    Posts: 532

    Guess you got ANALized in more than one way.
    Posted via Mobile Device
     
  8. CHUCK'SLAWN

    CHUCK'SLAWN LawnSite Member
    Posts: 81

    Let corporate america reduce their CEO's paycheck and they will save lots of money
     
  9. Nate'sLawnCare

    Nate'sLawnCare LawnSite Bronze Member
    Posts: 1,001

    I ate at one of my favorite steak houses yesterday, and the "2 for $20" special is now 2 for $22. Maybe you should have told them you are not in a cost cutting mode and said you would provide fewer services for a reduced rate. What happens at next renewal based on this?
     
  10. KrayzKajun

    KrayzKajun LawnSite Fanatic
    Posts: 10,742

    Good one Doug.
    Posted via Mobile Device
     
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