Many savvy elevator owners and managers make a practice of negotiating their elevator contracts to secure the best pricing and service. If you are new to negotiating elevator maintenance contracts terms, have no fear! Here are AuditMate’s Top 5 Negotiation Tips:
- Request Standard Maintenance Frequency Intervals – try to avoid contract language stipulating vague “periodic” maintenance frequency and instead request “monthly” or “quarterly” intervals. This ensures your vendor is contractually obligated to service your equipment at regular intervals that you can monitor. To help you track compliance, require that the mechanic check in onsite during every visit.
- Request Maintenance Activity Reports – Request that your vendor report the maintenance activities planned for each visit. Also request your vendor to provide work tickets that show all tasks performed during each visit. Keep these records for future reference to assess repairs, callbacks, and any root cause analyses that may need to be performed on the equipment. Otherwise, your vendor is required to keep written maintenance records in the machine room so that you always have access to them.
- Review Your Parts Coverage, Testing, and Obsolescence Terms – Make sure you fully understand what parts are and are not covered. Ideally, all parts and labor for repairs of major and minor parts based on normal wear and tear should be included in a full maintenance agreement. If there are parts that are excluded or prorated, make sure you have a good understanding of what your obligation and costs will be should you have to pay for the repair. Even better, negotiate a price upfront for any excluded repairs. Make sure that all currently required testing is included or if not, what your obligations are to perform the testing or what the additional costs will be. Finally, review the contract’s obsolescence language to ensure the term is fair for both parties and so you don’t end up paying more than you should for any repairs. Consider requesting that all parts less than 20 years old be included as part of your agreement or that you’ll only have to pay the difference between the old part and the new part. Special bonus tip: Any time you receive a callback invoice or repair proposal, cross-reference it with your contract to make sure you aren’t paying for parts that are included in your agreement.
- Hourly Repair and Callback Rates – Most vendor contracts don’t automatically outline hourly rates. Because this lack of information can potentially torpedo your budget when you have an unexpected callback or repair invoice, it helps to get the hourly rates for straight-time, over-time, and travel time listed in your contract. Many vendors will negotiate a percentage discount off their standard rates if you simply ask. Once you have negotiated rates, make sure the invoices you receive reflect them.
- Callback Coverage – Most contracts cover callback repairs that happen during “regular” hours. Yet, these “regular hours” can be different for different businesses. Make sure you negotiate a reasonable window that works for your business, so you have the support you need to keep your equipment running without constantly paying extra invoices. These coverage hours ARE negotiable, so don’t be afraid to ask for them to be adjusted to better accommodate the busiest riding hours of your elevators. Remember that callbacks due to misuse, vandalism, or unforeseen events (even riders dropping items into the pit) are rarely covered, so you should expect invoices when you receive service for them.
This list of tips is in no way comprehensive and there is no “one-size-fits-all” solution. Elevator contract negotiations can involve different strategies and tactics to achieve ownership goals and the best functioning equipment, which means there are many ways to obtain a fair contract with your elevator service provider.
And remember, if you’d like to know how your current contract stacks up or if you want to ensure you are only paying for the services you are actually getting, contact AuditMate. Our customers benefit from our fully enforceable SAFE Maintenance agreement that includes tailored terms in all these categories and MORE!