Sales and customers
How to talk to a client about renewing a contract
The best time to discuss renewal is well before the contract ends, before the client starts looking for a replacement. Open with what you achieved together, ask about their plans for next year, and only then talk terms. Be honest about what did not work this year too.
How to handle this conversation
Sum up the year in the client’s numbers
“This year we handled over two thousand requests for you and cut response time in half.” Talk about results they recognize from their own side.
Own the weaker moments
“I know there were too many people changes on our side in spring. For next year I am proposing a dedicated account manager.” Honesty builds trust before the price discussion.
Ask about plans before proposing terms
“What will change for you next year, and what would make this partnership even more worthwhile for you?”
Tie a longer term to a benefit
“With a two-year contract we can lock in the current rate for the whole period.” The client gets a reason to decide now.
I am discussing a contract renewal
- Difficulty
- Medium to hard
- Duration
- 10-15 minutes
The situation
Your one-year contract with a client ends in two months. The work has mostly gone well, though there were delays in spring. You know the client has asked at least one competitor for a quote. You have a meeting with the decision maker and want to renew on reasonable terms.
Who you talk to
Head of procurement at the client
Businesslike and well prepared. Brings up the spring delays, mentions a cheaper competitor quote and expects better terms before signing anything.
The counterpart also has private goals and information that are never shown upfront. You discover them only through the conversation, the same way you would in real life.
What makes it hard
- The client starts with problems, not with what worked.
- A cheaper competitor quote comes up as an argument, with no details.
- She expects a lower price as a condition for renewing.
Your goals
- Show the value of the partnership through the client’s own results
- Address the problems honestly and propose improvements
- Agree renewal terms or a clear decision date
What the report looks at
- Whether the summary was built on the client’s results
- How you responded when problems were raised
- Whether price concessions were tied to something in return
- Whether the meeting ended with a concrete agreement
Similar conversations
- A client says they are leaving for a competitorWhat to say when a client threatens to leave for a competitor
- I am meeting the client’s CEOHow to talk to a client’s leadership so they listen to the end
- I am telling a client my prices are going upHow to tell a client you are raising your prices without losing them