Price uplift clause
Also called Price escalation clause, Price increase cap
A price uplift clause sets how much a vendor can raise the price at renewal, as a percentage cap, an index or a new list price.
Why it matters to a budget owner
Many renewals are price rises as well as renewals. A cap such as 5% a year limits the increase; an uncapped clause lets the vendor charge its current list price.
If the contract has no cap, the renewal is an open commitment. Ask for one before signing or at the next renewal.
What to record
- The cap or index
- When it can apply
- The notice the vendor must give of a price change
Frequently asked questions
What is a typical price increase cap?
It varies by vendor and deal size. A fixed percentage or an inflation index are common forms; what matters is that a cap exists at all.
General working knowledge about commercial contracts, not legal advice. Your own agreement governs.
Glossary
Look up related terms
- Auto-renewal clauseAn auto-renewal clause renews a contract for another term unless one side gives notice before a deadline.