A price increase from your software supplier: five ways to respond

Every year around the same time they arrive: emails from suppliers adjusting their rates. Often by a few per cent, sometimes by more. Most businesses accept it without replying. That is understandable, but usually not necessary. And if you do not respond before the notice date, you often pay the new price for a whole year.

1. Read what your contract says

Check whether your contract or the terms and conditions allow a price increase during the term, and under which conditions. Sometimes the increase is linked to an index or to a maximum. Sometimes the price may only go up at renewal. That determines how much room you have.

2. Look at the notice date

Your negotiating position is strongest while you can still give notice. If the notice date is coming up soon, respond before that date. If it is far away, note when you want to have the conversation.

3. Reduce the number of licences

The quickest saving is often not in the price per licence, but in the number. Count how many people really use the tool and ask whether you can go back to that number.

4. Offer something in exchange for a better price

Suppliers value certainty. A longer term, or paying yearly instead of monthly, can be a reason to keep the old price or give a discount. Only do this for software you are sure you will keep using.

5. Ask, in a friendly and specific way

A short, businesslike email works best. For example:

Dear [name], thank you for your message about the new rates from [date]. We have used [product] since [year] with [number] users and are happy with it. An increase of [percentage] does not fit our budget for next year. Our contract renews on [date]. Can we discuss whether we can keep the current price, for example with a two-year renewal or with yearly payment? I look forward to hearing what is possible. Kind regards, [name]

Write your own email in a minute. Go to the negotiation email generator

Not every supplier will agree. But if you do not ask, you will certainly pay the full price.

Contracker keeps track of the price history of each contract and prepares a draft email with the facts well before the notice date. You change it and approve it; only then is it sent. See how it works.