Contract Re-Bidding Reaps Savings for Your Clients — Just When They Need Them
Nothing can you make you a star in your clients’ eyes like helping them save money. With the economy on the rocks and assessment delinquencies likely in the near future — if they haven’t already hit — the time could be right to reduce expenses by re-bidding some contracts.
Community association boards of directors shouldn’t feel like they need to strictly adhere to rigid re-bidding timetables of every three or five years. They don’t want to do it too often — and end up with a bad reputation among vendors — but extenuating circumstances can warrant exceptions to their usual review policy. And what is a recession spurred by a lingering pandemic if not extenuating?
Brad van Rooyen, president of HomeRiver Group-Florida, which manages about 120 associations in the state, says associations may not yet have seen significant upticks in delinquencies but shouldn’t assume they’re in the clear.
“I’m not sure if we’ve seen the full extent of what’s going to happen with the economy,” he says. “When we see the full ripple effect, I think that’s when associations might start seeing problems.” And that’s when they may need to try to trim expenses.
So which contracts should your boards thinking about putting out there? One factor to consider is whether a contract has a termination provision that will allow an association to ditch it without cause; otherwise, the association could end up on the hook for penalties if it takes its business elsewhere.
To learn other factors that can affect whether a service contract makes a good candidate for rebidding, read our new article, Time to Re-Bid? Vendor Contracts Under the Microscope.