A “Sample Letter To Reject Price Increase From Supplier” is a formal way to say “no” to a vendor’s higher prices. Businesses use it when a supplier wants to charge more. It helps them negotiate or find alternatives.
Need to push back on a price hike? You’re in the right place. We’ve got your back with ready-to-use letter samples.
This article offers templates to make writing easy. Use our examples to craft the perfect response. Get ready to say “no” with confidence!
Sample Letter To Reject Price Increase From Supplier
[Your Company Letterhead]
[Date]
[Supplier Company Name]
[Supplier Company Address]
**Subject: Regarding Proposed Price Increase**
Dear [Contact Person Name],
We acknowledge receipt of your notification on [Date] regarding the proposed price increase of [Percentage]% for [Product/Service].
After careful consideration, we are unable to accept the proposed increase at this time. Our decision is based on [Briefly state reason, e.g., current market conditions, existing contractual agreement, budget constraints].
We value our business relationship and are open to discussing alternative solutions. We propose [Suggest alternatives, e.g., maintaining current pricing, phased increase, exploring alternative products/services].
Please contact us at your earliest convenience to discuss this matter further.
Sincerely,
[Your Name]
[Your Title]
[Your Company Name]
[Your Contact Information]
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How to Write Letter To Reject Price Increase From Supplier
Subject Line: Assert Your Position
- Be direct and unambiguous. A subject line like “Re: Proposed Price Hike – [Your Company Name]” signals your intent immediately.
- Avoid vague language. “Concerning Your Recent Communication” is just dawdling.
- Include your company name for clarity. This aids in swift identification and processing by your supplier.
Salutation: Maintain Professional Courtesies
- Address the contact person directly. “Dear Mr./Ms. [Supplier Contact Last Name]” demonstrates respect and meticulousness.
- If unsure of the contact, use “Dear [Supplier Company Name] Team.” It’s impersonal but acceptable.
- Steer clear of overly familiar greetings unless you have a pre-existing rapport.
Introduction: Concisely State Your Rejection
- Acknowledge receipt of their price increase notification. “We received your correspondence dated [Date] outlining a price adjustment.”
- Immediately and unequivocally state your rejection. “We regret to inform you that we cannot accede to this price escalation.”
- Avoid equivocating or hedging. Directness is paramount at this juncture.
Body Paragraph 1: Articulate Your Justification
- Reference existing contractual agreements. “Our current agreement, stipulated on [Date], is valid until [Date] and does not countenance such mid-term augmentations.”
- Mention stable market conditions, if applicable. “Recent market analysis indicates no significant fluctuations warranting a price revision.”
- Quantify the impact on your operations. “This proposed hike would impose an untenable burden on our production costs, rendering our products uncompetitive.”
Body Paragraph 2: Propose Alternatives (Optional)
- Suggest a negotiation. “We are amenable to discussing cost-saving efficiencies that could mitigate the need for a price surge.”
- Explore order volume adjustments. “Perhaps a revised order quantity could afford us a more palatable pricing structure.”
- Propose a delayed implementation. “A phased implementation of the price increase, commencing at a later date, might be more palatable.”
Warning: State the Consequence
- Be prepared to articulate consequences for the supplier should a resolution not be reached.
- Clearly state what you intend to do. “If the price hike is implemented, [Your Company Name] will have to seek alternative suppliers.”
- Deliver the consequence assertively without being rude.
Closing: Reinforce Professionalism and Future Engagement
- Reiterate your desire for a continued partnership. “We value our relationship with [Supplier Company Name] and hope to resolve this amicably.”
- Offer further discussion. “We are available to discuss this matter further at your earliest convenience.”
- Use a professional closing. “Sincerely,” or “Respectfully,” followed by your name and title.
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Frequently Asked Questions: Rejecting Supplier Price Increases
Understanding how to professionally reject a price increase from a supplier is crucial for maintaining healthy business relationships and controlling costs.
This FAQ offers practical guidance on drafting effective rejection letters while preserving positive supplier relations.
1. What is the primary goal of a price increase rejection letter?
The primary goal is to formally communicate your disagreement with the proposed price increase while maintaining a respectful and professional relationship with the supplier.
2. What key elements should be included in the rejection letter?
The letter should include a clear reference to the price increase notification, a concise explanation of why the increase is unacceptable, and a proposed alternative solution or counter-offer.
3. How can I maintain a positive tone while rejecting the price increase?
Express appreciation for the supplier relationship, acknowledge their business challenges, and frame your rejection as a collaborative effort to find a mutually agreeable solution.
4. What are some acceptable reasons for rejecting a price increase?
Acceptable reasons include budget constraints, availability of cheaper alternatives, lack of justification for the increase, or a previously agreed-upon contract price.
5. Should I negotiate or completely reject the price increase?
Whether to negotiate or completely reject depends on your specific circumstances, the supplier’s importance, and the potential impact on your budget. Consider all factors before making a decision.