The phone call I received from a newsagent yesterday was all too familiar. They wanted to get out of a contract they had signed a year back and wanted to know if I had any ideas. The five-year agreement was not working for them. They say they were losing money as a result. The problem is that the contract lists few obligations of the supplier, thereby providing little in the way of an out.
Before you sign a contract for any product or service, check…
- That all supplier promises and obligations are documented to your complete satisfaction. I have seen contracts which document the newsagent’s obligations without covering the supplier’s obligations.
- That the agreement permits you to leave for valid reasons and without undue penalty. I have see a contract which does not provide fair reasons for leaving.
- That you can get out with reasonable notice.
- That there is a reasonable mediation process for dispute resolution.
- That you are not contractually responsible for their legal fees should you decide to take action against them.
- That you are in control of your business at all times. I have seen contracts where a supplier can act for you without you necessarily knowing they are doing this.
- That you are not blocked from accessing your business data. I have seen a situation where a newsagent has been denied access to business data because they refused to pay what they were told was an optional software support fee.
- That you are not precluded from switching to a competitor immediately on get out. I have seen contracts where you are blocked from switching to a competitor for a year after the end of the contract.
- That any claims made in the sales process against competitors are documented and signed by the supplier representative. If someone bagging a competitor refuses to do this you have every right to not believe them.
Check every contract carefully. Take your time. Get legal advice.
It’s easier to get out of a marriage than some of the contracts I have seen newsagents sign.
Hi Mark,
Can I get in contact with you privately? I’m wondering if you know anything about Aussie ATMs going into liquidation.
Danielle, 0418321338 is the best number or mark@towersystems.com.au by email.
Excellent advice. Newsagents take note.
Very helpful – I just have not done enough myself regarding contracts / leases in the past and it has come back to bite me. This could be a good fact sheet.
I hear that many ATM companies have changed their model since we signed our contract in 2006 but be warned about on-premise ATM’s. We were new to the business and were promised the world by an ATM provider and it was a disaster from almost day 1. It ended up COSTING us about $200 a month even though we were utilising it as best we could. I’d steer clear unless you get significant advice from fellow business owners with the exact same deal and your lawyer.
Hi Mark,
Thanks for wonderful informative Blog.
I am looking to get into newsagency business, is there any chance I can call you to get your expert advise.
Thanks
Sateesh
Certainly Sateesh. 0418321338. Any time tomorrow after 6:30am.