Got burned by a vendor contract clause I missed

Was reviewing a supplier agreement in my office downtown Atlanta last week and realized they buried a 3 year auto-renewal term on page 14. Ended up paying $8,200 in early termination fees after 6 months because I didnt spot it. Anyone else ran into hidden auto-renewal traps in vendor deals?

2 comments

2 Comments

cora40022d ago

My office is in the Buckhead area so I see this kind of stuff all the time with small businesses around here. One thing nobody talks about is how these contracts often have a "minimum monthly commitment" clause buried in the fine print that locks you into a certain spend level, not just a time period. I had one where the auto-renewal was bad enough, but the real kicker was they also required a 90-day written notice to cancel even if you caught the renewal date (which is basically designed to fail). So even if you spot the auto-renewal on page 14, you still get trapped by the notice window on page 3 or wherever they hide it.

the_julia22d agoTop Commenter

@cora400 nailed it with the notice window trap, that's the real sneaky part. Always scan for both the auto-renewal clause and the cancellation notice period side by side before signing, they love to split them up. I keep a checklist now just for these two things because missing either one means you're stuck for months.