Waste Management Melbourne: Do You Need a Long Term Contract?
Waste Management Melbourne: If you have a waste management contract in front of you from a potential garbage collection supplier you may be thinking “Do I really need to or want to sign an exclusive contract with a supplier for up to three years”?
It is easy to understand why a waste management Melbourne supplier may want to lock you into a long term contract i.e. security of revenue and the potential to increase your prices down the track. They may provide an artificially low rate at the beginning of the contract to entice you into signing – remember that most business sales reps will be rewarded financially (in one way or another) for getting you to sign the dotted line – often their remuneration will also be based on how long you sign for.
Why would you not want to sign a long term waste management Melbourne contract?
The reasons why a waste management Melbourne customer may not want to sign a long term contract are numerous. They include considerations such as you may be only starting in business and not want to lock in a long term contract; you have not shopped around many suppliers so are uncertain whether you are receiving a good deal; you may need to move business locations during the life of the contract; or simply you do not want to be locked into a long term waste management Melbourne contract. After all, within 3 years – your business could be a very different entity than it is now!
Rollover clauses in Waste management Melbourne contracts
There will likely be a rollover clause in any contract you see for waste management Melbourne services. This clause could read something like the below:
“This waste management agreement will automatically renew at the end of each term for a further term of 3 years unless either party gives the other written notice of termination at least 30 days prior to the end of the relevant term”.
Clauses like this can also be known as automatic renewal or evergreen clauses and wll renew a contract unless notice to terminate it is given within a time window prior to the expiry date. A major issue with clauses of this type is that most business owners are extremely busy and can easily miss this window – they have more to be doing than looking at small print in old contracts!
Changes to rollover law in November 2016 and also in November 2017
Legislation came into force on 12 November 2016, providing small businesses with similar protection to private individuals. The unfair contract terms protections available under Australian Consumer Law will also be extended to cover small business contracts ( a small business will have fewer than 20 employees and the contract value will be capped at $300k or$1m if it is longer than a year).
Unfortunately, the new laws will not apply retrospectively but only on contracts agreed or varied after 12 November.
Of interest to Waste management Melbourne customers are provisions in contracts that the legislation views as “unfair”
A. The right to unilaterally vary the contract
B. Early termination fees
C.Limited or no liability
D.Automatic rollover or evergreen clauses
E. Right to terminate without cause
F. Liquidated damages
From this date – it will be much harder for suppliers to sign customers to automatic rollover clauses.
Subsequent to this ruling – the ACCC has further ruled on the issue in November 2017 – you can see details here.
Your alternative for waste management in Melbourne
Waster.com.au provides low cost, flexible 30 day contracts that are the opposite of a long term locked in contract. Our pricing will not vary until 30 June 2018 and we rely on excellent service to keep customers – not constraining contracts. Have a look at our waste services to see the difference we can make to your business. We also cover whether your supplier will hold you to contract in our blog on waste bins Sydney.
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