Customer renewal letters: Services contracts pre expiry date
A contract renewal for services is sometimes difficult. The client may well be shopping around for better offers. It's far better to get in first, prior to expiry, with an offer to retain business than simply allowing the client to disappear.
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Depending on the kind of service you're providing, you may well be able to offer an incentive to the client. You can cost the incentive, and do a basic calculation on values. You can even simply keep the contract on the same costs, and lock in a customer.
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This can also be a good check of your customer retention program. If you find your customers responsive to your renewal offers, you're getting a good indication of customer needs for your business.
This example is of a plumber renewing a contract for 24 hour services to a large apartment complex. The plumber has figured out that retention of this contract, which is a large slice of his business, is worth an incentive. He can't add extra services, because he's already doing everything, but he can offer a cost break to strata management, which will appreciate it.
Example:
Business letterhead
Addressee
Your reference
Our reference
Contacts
Dear…
Renewal of contract
Just a note to remind you that the existing contract for supply of plumbing services expires on 31 January 2020. We will of course provide a one month period of service on contract terms after expiry as a grace period. After the end of this period our services will be provided at normal retail costs.
We'd like to propose a continuation of the existing contract for another five years on the existing terms and charges, if you're so inclined. This would represent a meaningful saving on costs compared to retail charges.
If you would like to consider this offer, or wish to suggest an alternative arrangement, please contact me directly on the above phone or email.
Yours sincerely
Sign
Title
Date
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Business Letters 
