
Ask HN: What to do about key supplier TRIPLING their prices at short notice? - christudor
Hi HN,<p>I am hoping some of you may be able to offer your advice on this on, as I imagine it&#x27;s a fairly generalised problem. The specifics of the issue aren&#x27;t actually that important, so I&#x27;m not going to include company names or any other identifiable details.<p>My company has a contract with an essential supplier who I pay several hundred dollars a month for a particular service. This service is absolutely essential to my product. The original contract was for a year, and comes to an end in the next two weeks.<p>Today, I was told that I am a legacy customer, and need to be put on a new plan. This new plan costs $10,000 a year, i.e. about triple the price I am currently paying. Given the timing of this price hike, I simply don&#x27;t have time to find an alternative supplier before my contract runs out.<p>What can I do?
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brudgers
To me, the place to start is with the consideration that if a key vendor isn't
turning a healthy profit then that key vendor is likely to go away. The second
thing to do is run the numbers and determine if the new pricing means shutting
down your business, seriously impacts the odds of future success, or is
rounding error.

The third thing, is to act on the results of your analysis and if it's not
time to shutter the doors come up with a plan for mitigating the effects of
the dependency.

From the vendor's point of view, your company wasn't pushing a renewal deal
through and therefore the vendor's revenue stream has been uncertain. It is
also possible that over the past year the vendor has repositioned itself
toward a different scale of customer and is taking their product in a
different direction.

Maybe the cost can be passed along:
[http://jacquesmattheij.com/Double+your+price+%28and+no%2C+I%...](http://jacquesmattheij.com/Double+your+price+%28and+no%2C+I%27m+not+kidding%29)

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meric
Negotiate for a shorter contract ($4000 for 4 months), find an alternative
supplier.

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greydius
Post the actual details of the product on a website aimed at entrepreneurs and
tech-savvy people (aka "hackers"). Someone might see a good business was
opportunity, and you'll have yourself a new supplier.

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kazinator
What you do is provide some unique value and commoditize the @#$% out of
everything you depend on.

Could these suppliers be competing with you? How essential is _your_ part to
the combination of whatever you do plus their service?

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qwrusz
More details (but still anonymized) could help give better advice.

I guess first question should be: What makes you think you will find an
alternative supplier at a much cheaper price at all?

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SamReidHughes
The general solution is to renegotiate your contract further in advance, so
that you have time to find an alternate supplier.

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justsorneguy
Pay them...

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kevinherron
UserVoice?

