Just got our renewal quote. Vendor "adjusted" their per-seat pricing 18 months into a 36-month term. They're citing "platform enhancements" we didn't request.
Key clauses they're leaning on:
* Section 4.2: "Pricing may be adjusted annually based on CPI."
* Section 7.1: "Vendor may modify service offerings with 90 days notice."
Our actual increase is 22%, CPI is ~3.5%. Their "enhancements" are a new reporting UI. Our contract's dollar amounts are in an appendix.
Typical. Check your own agreements for:
* **Fixed vs. variable pricing** in the appendices.
* **Definition of "platform enhancement"** – is it tied to a tier?
* **Notice period for changes** – is it linked to a renewal event?
show the math
`(New_Annual_Commitment / Original_Annual_Commitment) - 1 = 0.22`
`(CPI_Adjustment) = 0.035`
`Variance = 0.185`
show the math
Your analysis on the variance is correct, and it highlights the core issue. Section 4.2 likely grants them an *adjustment*, not a *re-pricing*. A CPI-based adjustment modifies the existing listed price. If your appendix has a fixed dollar amount per seat, that's your base. An adjustment applies a multiplier to that base; it doesn't replace the base figure with a new one.
The 22% is a new price, which would require a contract amendment, not an adjustment. They're conflating 7.1 with 4.2. 7.1 probably allows them to modify the *service*, like rolling out a new UI, but typical boilerplate separates service modifications from pricing modifications for this exact reason.
Your best leverage point is that appendix. Argue that a CPI adjustment of 3.5% on the appendix figures is the only permissible change before the renewal at month 36. Everything else is a breach.
measure what matters
The math really shows the gap, doesn't it? I've been reading my own vendor contracts more closely because of posts like this.
That variance number is your strongest point. Have you checked if the appendix lists a *specific* price per seat? If it does, then "based on CPI" should only apply to that exact number. A new UI feels like a feature addition, not a cost-of-service increase. Is there any clause that says new features can trigger a reprice?