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Jamie-Law
Jamie-Law, Solicitor
Category: Law
Satisfied Customers: 5371
Experience:  Solicitor
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We are an SME Ltd Company purchasing 90% of products from

Customer Question

Hello, we are an SME Ltd Company purchasing 90% of products from one supplier, for whom we are Master Distributor. Since being granted this status (a couple of years ago) we have received several price increases which are making us un-competitive and causing us to lose business.
In April 15 they applied a 12% increase followed by 8% in 2016, 5% (on some products) in May 17 and a further 8% due in the coming weeks.
There are a limited numbers of other suppliers in our market and if we were able to move to an alternative supplier this would take considerable time and risk losing considerable business.
We are their Master Distributor for the UK & Ireland and have been very loyal over the past 13 years or so, to the point that we are alienated from other major suppliers.
On the basis of this brief summary we are trying to get an indication if there may be a legal position against this?
Submitted: 5 months ago.
Category: Law
Expert:  Jamie-Law replied 5 months ago.

Hello my name is ***** ***** I will help you with this.

What does your contract say, if anything?

Customer: replied 5 months ago.
We have a 23 page contract that expired in April 2017. We have held back on signing a new one at the moment.
Is there something specific you want to know about?
Expert:  Jamie-Law replied 5 months ago.

Ok. Thanks for this, what is it you want to achieve though? Stop them increasing prices?

Customer: replied 5 months ago.
if we can, but as much to show that we will not continue to accept price increases that damage our business.
Expert:  Jamie-Law replied 5 months ago.

What does it say in the contract about price increases?

Customer: replied 5 months ago.
30 days notice to be given.
They informed us in May of this latest increase.
Expert:  Jamie-Law replied 5 months ago.

Ok - sadly if you agree to the contract then you are bound by these terms. As this is a business 2 business contract there is far less protection as if it were business 2 consumer.

If you agree to the terms then sadly you are bound by the contract, in relation to its clauses and price increases.
Sadly it comes down to a commercial decision, whether or not you want to sign a new contract. As such there is nothing you can do in relation to price increases. I realise that it makes you not as competitive but it may be that you decide to end your relationship and go elsewhere.

But its purely a commercial decision.

I am sorry if this is not the answer you want, nor the one I want to give you, but I have a duty to be honest.
Can I clarify anything for you about this today please?

Expert:  Jamie-Law replied 5 months ago.

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