How familiar are you with your school’s contracts? Time for a review?

It’s never easy managing all of the contracts your school may be engaged in – now imagine doing that across three different schools. That is the task that Louise Hatswell, director of finance/business manager and founder/chair of South Yorkshire School Business Leaders Group (SYSBL) inherited, and one she has come to enjoy. What better satisfaction than (re-)negotiating your school’s contracts and getting the best value for money?

One of the first tasks I undertook when starting in my role working across three schools was to review contract information.

Bad communications

The first that caught my attention was the text communication system. My previous school was a similarly sized secondary and the system I Implemented there cost just over £2,000 a year for unlimited texts. I was, therefore, stunned to see that the secondary I now worked for was spending over £7,000 a year on theirs! I obtained quotes for alternative systems and found one that was much more cost effective and offered a solution which included an online payment facility for parents – at less than half of the current cost.

The danger of roll overs

I contacted the current provider to enquire about notice periods only to be told that the contract had automatically renewed the year before onto a rolling three-year contract. There was no record of this anywhere in the school. I then asked if there was any way we could negotiate an early termination; they refused and said we would have to pay the monthly license cost until the contract expired.

I asked if we could renegotiate the text cost as the contract had been set up seven years previously. Again, they refused. I calculated the costs of the new company I had sourced, and the minimum monthly license cost, and it still worked out cheaper than using the original provider. I gave them notice that we did not want to renew the contract when it expired in two years’ time and we took out the new contract. We still saved money over the remaining two years and are now saving even more.

Further investigations

After further investigation I found that this was not the only contract with a rolling renewal! There was another hefty amount paid for a dust mat contract so I arranged to meet with the providers and asked that the contract be reviewed.

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The dust mats in the main entrance had an old-school name on which had been changed several years earlier. The mats around the rest of school were also in poor condition. Even though the contract had rolled over, nothing had been renewed. I negotiated to have new mats provided, including new corporate doormats at the main entrances, and a reduced contract price, saving around £1,000 per year over the remaining contract.

The war on paper

The photocopiers on two of the schools were due for renewal and, using the Crown Commercial Service Framework, machines were leased at very competitive prices, with the lowest copy charges I have seen. The copier in the third school was in a longer lease with a number of years left to run; the copy charge was much more than the new contracts.

Again, I contacted the company, asked for the contract to be reviewed, and they agreed. The machine was replaced with a newer model and a much-reduced copy charge and, although it meant taking out a new lease contract, it still saved a significant amount of money over the life of the new contract.

Final words

As school business leaders, we constantly seek to make savings and secure the very best deals – achieving value for money and demonstrating best value – but, with historical contracts containing rolling renewals and long notice periods, sometimes our hands can be tied.

I would urge everyone to check the small print of contracts and give notice in writing immediately if there is a rolling renewal clause in the contract or have a robust system in place detailing notice periods and a reminder system in plenty of time to obtain renewal quotes prior to the notice period. If you are stuck with a historical automatic renewal, speak to the provider and ask to review the contract to see if you can improve the service, reduce the costs – or both!

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1 Comment

  1. Very good advice. Software contracts are another area to review carefully. Long term tie ins are not necessarily best value from a cost perspective and may lack flexibility if the school changes its status e.g. becomes an academy or part of a MAT.

    Be sure to always test the market at renewal!

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