Fallow year, fresh terms: using the quiet season to renegotiate your contracts

Let’s be honest, summer and early autumn are a bit of a lull for most businesses. The year-end chaos has passed, the new financial year targets haven’t quite kicked in yet and there’s a brief window where you can actually think straight.

For procurement and legal teams, that breathing space is valuable. It’s the perfect time to dust off your contract portfolio, review what’s working (and what isn’t) and get things tidied up before the autumn rush hits.

Rather than letting the quiet months drift by, use the time to sharpen your commercial position and move on from legacy arrangements that stopped serving you well a few renewals ago.

Identifying contracts ripe for renegotiation

First things first: you need to actually know what contracts you’ve got. Sounds obvious, but you’d be surprised how many organisations are running on a combination of memory, filing cabinets and good intentions. Every business should have a proper contract register, a central record of your key agreements, start dates, expiry dates, notice periods and any break or renewal clauses. If you haven’t got one, building it should be the first priority.

Once you can see what you’re working with, focus on three categories: contracts coming up for expiry in the next three to six months; contracts with break clauses that give you a chance to exit or renegotiate; and those contracts that have been quietly rolling over on auto-renewal while nobody was paying attention, potentially at rates that made sense in 2019 but certainly don’t now.

Pay close attention to notice periods. Many commercial contracts in England and Wales require 60 to 90 days’ written notice to prevent automatic renewal. Miss that deadline, even by a day, and you could find yourself locked in for another full term on unchanged (and potentially unfavourable) terms. Diarise these dates well in advance, set reminders and make sure someone in the team clearly owns the job of serving notice on time.

Benchmarking: know your market before you negotiate

Walking into a renegotiation without doing your homework is essentially just asking your supplier to be generous. Before you pick up the phone, invest some time in benchmarking. That means understanding what the going rate is for what you’re buying, identifying alternative suppliers and working out whether the service levels you agreed to a few years ago still actually fit your business.

A few practical steps worth considering:

• Get competing quotes: even if you fully intend to stay with your current supplier, having a credible alternative strengthens your negotiating position considerably. Nothing focuses a supplier’s mind like the prospect of competition
• Look at the service level data: has your supplier been hitting their KPIs? If they’ve been missing targets or scraping through by the skin of their teeth, that gives you perfectly legitimate grounds to renegotiate pricing or tighten up performance standards
• Think about volume and scope: have your requirements grown or shrunk significantly since you first signed on the dotted line? If so, the pricing structure probably needs a rethink
• Keep an eye on the broader market: if the market is softening, suppliers will be keener to hold onto your business and may be open to concessions. If things are tightening up, locking in decent rates now could save you a headache down the line.

Leveraging market conditions

Timing matters. If your sector is seeing prices come down, overcapacity or increased competition among suppliers, you’re negotiating from a position of strength. Use that leverage to push for better pricing, improved payment terms, tighter service levels or more flexibility – things like shorter commitment periods or more generous exit rights.

The quiet season itself works in your favour too: suppliers often want to lock in revenue before their own year-end, so they may be more willing to offer concessions during traditionally slower months.

Common pitfalls to avoid

• Sleepwalking into automatic renewals: as mentioned above, auto-renewal (or ‘evergreen’) clauses are everywhere in commercial contracts, and they’re perfectly enforceable under English law provided the wording is clear. The real danger isn’t that they exist, it’s that nobody in your team noticed the renewal window closing until it was too late. Set those reminders
• Living with legacy terms that have gone stale: contracts that have rolled over multiple times without anyone taking a fresh look often contain pricing, liability caps or service levels that bear little resemblance to today’s market. Don’t assume a contract is still a good deal just because it was a good deal five years ago; the market has almost certainly moved on, even if the contract hasn’t
• Not knowing what contracts you’ve actually got: if your register is out of date, or worse, doesn’t exist, you risk contracts renewing without anyone in the business even knowing about them. This tends to happen most with lower-value agreements, but it all adds up. Death by a thousand unnoticed renewals, if you will
• Failing to document renegotiated terms properly: if you renegotiate terms, get them recorded in a formal deed of variation or side letter, signed by both parties. Do check whether the contract itself has specific requirements about how variations must be made; some contracts specify that emails don’t count as ‘in writing’, which can catch people out. Relying on informal correspondence alone creates unnecessary risk.

Action plan for autumn readiness

1. Audit your contract register. Make sure it’s complete, accurate and has all the key dates and notice periods you need. If it doesn’t exist yet, now’s the time to build it
2. Flag your upcoming deadlines. Identify every contract with an expiry, break, or renewal date in the next six months and make sure someone specific owns each one. Vague ownership leads to missed deadlines
3. Prioritise by value and risk. Focus your renegotiation energy on the big-ticket or high-risk contracts first. You can’t do everything at once, so be strategic about where you spend your time
4. Do your homework. Gather market data and get alternative quotes before you start any conversation. Knowledge is power (and leverage)
5. Serve notices on time. If you want to prevent auto-renewal, serve your notice in the right form and within the contractual timeframe. No excuses
6. Document everything. Make sure all renegotiated terms end up in properly signed written variations. If it’s not in writing, it didn’t happen – at least not in any way you can easily prove.

The bottom line? Treat this quieter period as a strategic opportunity, not dead time. Get your house in order now and you’ll head into autumn with a leaner, sharper contract portfolio and without the unpleasant surprise of discovering you’re locked into terms you never meant to accept.