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 WHY JOIN? FIND SOLUTIONS HOW DOES RETEX WORK?    |
In terms of a commercial lease, many times the lease is negotiated or signed with the Landlord or its Agent (i.e., property manager). However, many times the people negotiating the lease are not the ones billing you each month thereby leaving room for error. This may be due to inadequate staff knowledge, staff turnover, or training, or many times the misapplication of lease language, whether or not complex. Many commercial leases are effected by other tenants at your property, where some component costs of your lease have to be apportioned correctly amongst all tenants. As you can see, there are a lot of opportunities for mistakes to exist and go unseen. The fact is that the vast majority of commercial leases are being overcharged. The semantics of negotiating a commercial lease are very much the same as negotiating a supplier contract. You have to do your due diligence in the beginning to ensure that you are getting the best value for your dollar. But the same fact remains, if not regularly audited you can’t truly know if you are still receiving the same value you thought when you signed the contract. Our Supplier offering this service has brought about millions of dollars in recoveries and future savings to dozens of their clients, both big and small (companies with an annual commercial leasing cost of $200,000 or more, who are not on a triple net lease, and who have occupied their property(s) for 3 of more years qualify). Their team is focused on bringing about true financial results either through solid hard dollar recoveries or providing realizable future cost savings through a Benefit Share Model … that is, they are only compensated when their clients receive realizable financial benefits. In addition, their services can also bring about the same results from an audit of your supplier contracts, such as security, maintenance, elevators, and virtually any vendor that represents a major expense on the General Ledger. Here are only a couple of recent examples of their results: Commercial Lease: Their client, located in a major metropolitan city, leased over 40,000 square feet. Their review identified many discrepancies, including calculation errors, base issues and incorrect expense inclusions. Their work resulted in a $144,000 recovery for 2005 payments, as well as a reduction of $50,000 per annum (minimum savings) for the remainder of their Lease Term which runs for 13 more years. Contract Compliance: During a review for a client on the West Coast, they performed an audit of a printer and copier management/maintenance service supplier. During their review they identified discrepancies in the supplier’s reconciliation methodologies. Because their client’s supplier had insufficient historical records, our supplier was able to determine a proper method of applying the error back to the past while also agreeing to a new method of reconciling the account going forward. Their work resulted in a refund to their client of $150,000, a $35,000 per year reduction in annual billings based upon current volumes. As their client’s business grows the savings will grow along with them. Sales & Use Tax: From only reviewing one piece of a client’s accounts payable records, our supplier identified a billing discrepancy with regards to technology and service billings. Upon reviewing the contract and the services included, our supplier determined that 80% of the monthly fixed charges that their client was being billed were actually exempt from sales & use tax. In order to affect this refund and subsequent reduction in future taxes, our supplier had to facilitate a meeting between their client’s tax department, their supplier’s tax department and the supplier customer manager. During the course of this meeting, they reviewed each and every part of the services provided and the respective exemptions permitted by statute. The supplier agreed to correct their billings going forward but because of the clear error that was made on their part they also agreed to refund their client all the sales taxes they were improperly charged since the beginning of their contract (i.e., four (4) years) and would file for a refund with the respective state themselves (NOTE: The State in question only allows for a three (3) year refund. This fact was disclosed to their client’s supplier but because of the clear mistake and their mistaken billing representation, their client’s supplier agreed to compensate their client for the additional year thereby helping to re-strengthen the relationship). This one issue resulted in a refund of $308,400 and a monthly reduction in supplier billings from the removal of incorrect sales tax of $6,500, which will continue for the next five (5) years. Please note that the service benefits described above do not just lend themselves to tenants but also to property owners as well. In addition, property owners can also benefit from their review of property taxes – as many times the taxing authority in your jurisdiction may also make mistakes in their valuations or even in their calculations. All of the programs above are Contract Compliance Initiatives that can bring about hard dollar recoveries (i.e., LOST PROFITS) and/or secure future savings (i.e., FOUND PROFITS) for your business! Our supplier will perform an initial assessment of your contract(s) and from their advice whether or not an opportunity exists. Should an opportunity exist, our supplier will perform a detailed forensic line item review of your contract and contract billings over the past three (3) to six (6) years (depending upon respective states statute of limitations). From this review, their findings will be presented to your team (determined at the onset of the project) for review, discussion and approval before presenting to your landlord, supplier or taxing jurisdiction. This is done to ensure that their facts are in line and that your business agrees with the issues they are planning to pursue. The bottom line is that there is not enough time in the day for your staff to handle their regular day-to-day tasks and also do the degree of review that our supplier provides and at no cost unless financial benefits are achieved! To sign up for this service, a Retex Member may contact the “Business Services” hotline Monday-Friday during business hours, offered by Retex Services at 800-892-0879 in the Continental U.S. (Members in Alaska and/or Hawaii call 800-517-0158), and provide their name, company name, title, phone number and email. They will be contacted directly by Retex Services, who will provide them with the sign-up forms, and then; will introduce them directly to the service provider. Alternatively, any Retex Member may email Retex Member Care. |
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Retex is a Registered Trademark of Retex Cooperative, Inc. |
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