This clause locks in a price for a set period, preventing the vendor from raising costs. It protects you from unexpected price increases that could damage your budget or profit margins. In contract law, this is called a "fixed price" term, and without it, vendors can often increase prices during the contract period (unless the contract says otherwise). For example, if you agree to buy 1,000 units at £10 each over 12 months, a price stability clause stops the vendor charging £12 in month 6.
Negotiate for the longest price lock period you can—ideally matching your contract length. Ask whether the clause covers all costs or just the base price (some vendors try to add "surcharges" for materials or fuel separately). If the vendor insists on price increases, tie them to a specific index like inflation, with a cap on how much they can rise. ---
Frequently Asked Questions
What does this clause mean in simple terms?
This clause locks in a price for a set period, preventing the vendor from raising costs.
Why should I care about this clause?
It protects you from unexpected price increases that could damage your budget or profit margins.
What are my options?
In contract law, this is called a "fixed price" term, and without it, vendors can often increase prices during the contract period (unless the contract says otherwise).
How does this affect small businesses?
For example, if you agree to buy 1,000 units at £10 each over 12 months, a price stability clause stops the vendor charging £12 in month 6.