Auto-Renews and Escalators

Allastair Meffen

Looking to do some analysis on the benefits of keeping an AR in our contract that also includes an escalator of some type whether a flat 5% or something linked to CPI for example. Auto-renew clauses are pretty standard but what are you typically seeing for time, is 30,60,90 days? I understand that the answer can be nuanced depending on the type of contracts your customers sign but just looking for a rough swag. Then I would like to understand what if any behavior change did you see with your customers once an escalator was included. Did more contractors NR Ontime early just to get out of clause or did it lead to more negotiations at the time of renewal. Finally, what have people found around including multi-years in the AR. If a customer starts in a two year then their AR would be also be into a two year, for example.

Thank you in advance for you thoughts.

Jordan Silverman

We are just in the process of implementing this so I am also interested!

Right now 90% of our clients pay monthly so we are increasing the monthly rate 5% after the clients 12th month of billing.