Elevator maintenance is essential to just about anything organizations do with their buildings. Because they’re so commonplace, many companies may not even consider that they could be saving on these fixed costs. And even if they were to scour the fine print of their contracts, they may have no idea what the next step would be to realize those savings.
That’s where SIB Fixed Cost Reduction enters, changing the way companies think about fixed costs like elevator maintenance.
Understanding Elevator Maintenance Contracts
SIB Fixed Cost Reduction will examine contracts, and our experts will find the wiggle room, uncovering opportunities for savings. We will get answers to important questions such as:
- When does overtime apply under the contract and what percentage of these jobs can actually wait until business hours have begun?
- What are the differences between trouble calls and repairs and how do these differences relate to the contract?
- Is travel time a significant portion of the money seen on the invoices?
- If maintenance is missed or incomplete, is the organization entitled to a refund for the charges that month or not?
- How many “trouble calls” count as regular monthly service calls that are included in the contract?
- What is the average response time for a trapped passenger? Does the elevator maintenance company offer refunds when elevators break down?
- What is the availability of spare parts on the market? Is the organization paying fair market price for parts?
Negotiating the Annual Elevator Maintenance Contract
Elevator companies have different procedures for annual price adjustments, but one thing is almost always the same: a price adjustment will occur every year. And guess what? It isn’t heading down.
When annual price adjustments result in cumulative increases over many years—which is virtually guaranteed—the price may far exceed what the current elevator contract might bid if they were trying to win an organization as new business.
SIB Fixed Cost Reduction knows the going rates and bids and can negotiate on a company’s behalf.
Negotiating Overtime Clauses to Save Money
When union mechanics work during their hours of 8:00 a.m. to 4:30 p.m. Monday through Friday, it means that there is time and a half outside of these hours. That can have a major impact on an organization’s bottom line.
SIB Fixed Cost Reduction is often able to negotiate and structure maintenance contracts so our clients will only be charged for the overtime-differential portion on callback services. This can also help reduce overtime costs.
Opportunities to Save
Here are just a few of the ways SIB can find opportunities to save organizations money:
- Long-term contract discounting: Elevator companies like any other business tend to prefer longer contracts. SIB may be able to win a healthy discount by extending length of contract minimally.
- Hold-harmless clause: SIB may be able to help with negotiating contractual hold-harmless clauses. Considering the average elevator injury lawsuit is over $30,000, that can have a major effect on a company’s bottom line.
- Discounts for low occupancy: If much of the building is vacant for a long time, SIB may be able to find a discount as high as 10%.
- Annual price adjustments: Most elevators include annual price increases in their contracts. We’ll help negotiate a limit on these increases.
- Phone charge elimination: Dedicated phone lines for emergency elevator phones are unnecessary. Cell phone technology can help organizations save money without sacrificing any call quality.
- Control trouble call costs: If a company doesn’t need a service tech at the scene, there’s no reason they should have one there.
- Reduce overtime costs: Don’t get charged double time to have work done on a Sunday. Learn how to hire work when needed and when it saves money.
To learn more about our process, check out “How it Works.” To get the process started, simply contact SIB Fixed Cost Reduction and set up a kick-off call. There are no risks at this point, so you’re free to simply let us know what you need, what your current situation allows, and ask us how we might be able to serve you.