Year Two of an Outsourcing Relationship: The 5 Things to Renegotiate Before You Renew

A COO clicks "agree" on the renewal email and rolls over last year's NT$30,000/month contract. Six months later he notices: the team quietly does a dozen extra hours a month of work that isn't in the contract, one midnight outage had nobody obligated to respond by any hour, and the "code IP ownership" line was a throwaway sentence. He wasn't cheated — "renew as-is" is just the easiest path, and the most expensive. Year two isn't copy-paste of year one; it's renegotiating five things clearly.

Myths to Break

Myth 1: "It's going well, just renew as-is." Truth: "going well" often means scope quietly grew — renewing as-is buys year-two's larger workload at year-one's price.
Myth 2: "Renegotiating price hurts the relationship." Truth: not talking hurts — a vendor silently absorbing cost will invest less or cut corners elsewhere. Put pricing on the table and both sides relax.
Myth 3: "Handle it when it happens, no need for an SLA." Truth: without an SLA, every emergency is re-negotiated ad hoc at premium rates — more expensive than an agreed response time.
Myth 4 (contrarian): "Renewal means negotiating a lower price." The industry treats renewal as haggling, which is wrong — year two is about clarifying scope, SLA and exit; price is one item, and squeezing it until the vendor disengages hurts your own system.

Framework: The 5 Things to Renegotiate

Lay the year-two contract open and align item by item:

1 Scope: fix the "ad-hoc adds" from year one — what's in the retainer, what's billed separately.
2 SLA: response time, resolution time, availability target (e.g. 99.9% monthly), emergency channel. Performance targets can reference public standards like Core Web Vitals (LCP).
3 Pricing: retainer / hour-pack / usage, adjusted to year-two's real workload; lock auto-billing and invoicing with tools like Stripe Billing.
4 IP & data: ownership and delivery format of code, design, database in writing.
5 Exit: termination terms, handover period, document/account transfer checklist.

Three Typical Scenarios

Company type	Character	Recommended model	SLA
10-person startup (fast growth)	Scope shifts monthly	Hour-pack + quarterly scope review	Next-day response is fine
50-person mature firm (stable ops)	Critical system, costly downtime	Monthly retainer + pinned exit/handover	4-hour response + 99.9% availability
Traditional/B2B (slow change)	Low usage but can't stop	Low retainer + clear emergency surcharge	Point is "someone's there and reachable"

Hidden Costs (of Not Renegotiating)

Scope creep: 8–12 unbilled "happy to help" hours a month at NT$1,500/hr = NT$12,000–18,000/month of invisible cost one side absorbs.
Stale pricing: a year-one price against a year-two workload erodes vendor investment (which shows up in your quality).
No-SLA emergencies: ad-hoc fixes billed above retainer rates, with no response guarantee.
Undefined exit: you discover at departure that accounts, docs and source aren't all transferable, dragging handover a month or two.

Partner KPI Scorecard

Score your vendor before renewing (each 1–5):

Response speed (within promised time?)
On-time delivery rate
Proactiveness (do they flag risks/optimizations?)
Communication transparency (visible progress/hours?)
Technical quality (bug rate, launch stability)
Documentation completeness (can a successor follow it?)
Security awareness (do they proactively report flaws?)
Billing clarity (estimate vs actual gap)
Flexibility (cooperation in emergencies)
Exit-friendliness (willing to hand you over cleanly?)

Total < 30, seriously consider switching; 35–45 is a healthy long-term partner.

ScriptWalker's Models + When We're Not a Fit

We offer four models: one-off project, monthly retainer, advisory, full outsourcing. Year two usually shifts from Project to Retainer or Advisory. But we'll say outright when these don't fit:

You want "unlimited changes, never billed extra" all-you-can-eat — any healthy engagement needs scope.
You expect a retainer below the real workload while demanding a high SLA — the math doesn't work.
You actually just need a one-off wrap-up, not a long-term relationship — then don't sign a retainer; save your money.

Renewal Playbook

T-60 days: both sides inventory year-one's real workload and out-of-scope items; score each other on the KPI card.
T-30 days: negotiate the five things (scope/SLA/pricing/IP/exit) item by item; draft the year-two contract.
T-7 days: confirm auto-billing, invoicing, emergency channel; sign.
T+30 days: first review of whether new scope matches reality; fine-tune.

Decision Checklist

☐ Did year-one "ad-hoc adds" become routine but stay out of the contract?
☐ Do I have a clear SLA (response/resolution/availability)?
☐ Does year-two pricing reflect the real workload?
☐ Is code/data IP ownership in writing?
☐ Are exit and handover in the contract?
☐ Have I scored the vendor on the card?
☐ Is there a clear emergency channel and rate?
☐ Are invoicing and auto-billing clear?
☐ Do I know how many hours we actually use monthly?
☐ Did I start renewal talks 60 days ahead?

FAQ

Must I re-sign in year two, or can I just roll over?

You can roll over, at your own risk. Year-one scope almost always grows, so rolling over buys new work at the old price. At minimum re-align scope, SLA and exit; the price can stay the same.

Won't renegotiating signal distrust to the vendor?

The opposite. Opening up scope, pricing and SLA removes guesswork for both sides. The vendor who resists opening up is the one to worry about.

How strict should the SLA be?

Depends on system criticality. A marketing site is fine with next-day response; payment/order/booking systems where downtime loses revenue warrant 4-hour response + 99.9% monthly availability with a named emergency channel.

How do I decide renew vs switch?

Use the KPI scorecard. A healthy total (35–45) and willingness to clarify the five things means renew; low score plus resistance to renegotiate means switching usually costs less than enduring.

Call to Action

Renewal coming up and unsure how to handle year two? ScriptWalker offers a free 30-minute "renewal health check" using the scorecard and five-things list above to make your year-two contract fair to both sides: