Third-party Lease Review
From this review a report is prepared listing vulnerable sections and clauses, and proposing more amenable alternate wording. The printer or purchasing agent can then negotiate with the supplier.
This in-house negotiation step is fraught with its own frustrations, as the supplier knows there are only days before the existing lease expires and the new one must go into effect or further usurious fees are enacted from the old lease. Automatic renewals, sometimes as long as 12 months, may be enacted if proper notification lease requirements are not taken. In other words, request the standard equipment lease from the supplier at the time they submit their RFQ response, which is 60 days or more before the old lease expires, or their bid is considered nonresponsive. (The game can be played both ways.)
Many printers find that the most successful methodology is to have this third party lease expert negotiate these new preferred terms for them. This is often done in a conference call with both the printer and expert talking to the manufacturers’ lease department. This is the first time that the printer will discover a delightful surprise. (All other surprises described in this article have intentionally been horrific, though unfortunately too often realistic.)
The surprise is that the manufacturer’s leasing department is often happy to negotiate the terms of the lease, particularly with another professional who understands what the gobbledygook actually means.
There are two other opportunities to negotiate a lease agreement after it has been signed and is in force. The first is during the due diligence of a merger or acquisition and involves the leases of the firm to be acquired. The second is a lease of a firm undergoing foreclosure. Under both of these circumstances the equipment manufacturers have been reported to be eager to discuss more amenable terms.