Negotiating early exit of a photocopier contract

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Dynamic

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#251336 19-Jun-2019 21:15

Hi Team

We have a small client that is NZ office of an international company, and they are about to close the local office except for one rep that will work from home. They have asked us for advise about exiting their copier contract which is 20 months into a 60 month agreement. We were not involved in the sourcing of this copier.

Has anyone any tips based on experience?

Cheers.

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sdavisnz

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#2261129 19-Jun-2019 21:17

You'll need to contact them and they will prob make you pay out the full amount or they will sue the international company.

That's why I don't work in the photocopier business.

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sqishy

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#2261152 19-Jun-2019 21:59

First check what 60m deal you had, could include paper, toner etc related charges. There is always an exit price. An alternative is to see if you can have them hold for later i.e effectively a credit in case.

xpd

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#2261197 20-Jun-2019 07:28

The copier contracts IME are generally pretty tight, and don't allow much for movement if you change your mind on things unless it means more money for them. You'll probably find it'll have to be paid out or if theres a one off exit fee. But does come down to whats in the fine print.

Sometimes if the supplier (Ricoh, Xerox etc) has contracts with the rest of the global company, something can be worked out, but usually with NZ, offices are left to source their own suppliers and contracts rather than fall under an global one.

XPD / Gavin

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trig42

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#2261218 20-Jun-2019 08:48

There will be a (large) exit fee involved.

If the parent company wants to close their NZ office, it will be one of the costs of doing so.

I looked into terminating our copier contract with only 12 months to go of 60 and the exit fees were pretty horrendous. We decided to leave it in place until it runs its course. Luckily, our office is still open, so it isn't a dead cost.

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#2261333 20-Jun-2019 10:34

Yea it's just an equipment lease. They will need to request the settlement amount. It will be large.

Dynamic

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#2261360 20-Jun-2019 11:03

Thank you, team. I appreciate your thoughts.

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#2261478 20-Jun-2019 12:57

Is there a no-assignment clause in the contract? Potentially you could find someone to take over the contract for a discount?

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#2265095 26-Jun-2019 15:09

I asked a few of our clients without copiers if anyone was interested in taking over the contract, and a couple considered it but declined in the end.

Costs are around $130/month, 40 months to go, 0.7c per black and 7.5c per colour A4 side if anyone in Auckland is interested for themselves or a client. If you make a cheeky offer around the monthly cost, it just may be accepted. I suspect they are currently up for the full remaining rent. I'd put you in touch directly rather than getting in the middle.

“Don't believe anything you read on the net. Except this. Well, including this, I suppose.” Douglas Adams