Annual Contracts Vs Long-Term Agreements
When you invest in EdTech you will often face a choice (sometimes following a free or discounted trial period) between entering into an annual or longer-term contract. But how do you decide which is right for your school?
The stability that comes with a long-term contract might be reassuring, but you could end up either stuck using EdTech that may no longer be right for your school or spending even more money to get out of it (if the latter is even an option).
On the other hand, depending on what EdTech you’re investing in, there may be times when it makes more strategic and financial sense to use a long-term contract.
Whichever you choose, it’s something that needs careful evaluation. So, let’s take a look at long-term agreements and rolling annual contracts, and explore which might work best for your school.
Get more for your money
From a budgeting perspective, investing in a long-term contract may offer peace of mind in the short-term, with a fixed expenditure. However, the risks associated with such large upfront costs should be considered before you commit yourself to a lengthy contract.
Whilst a long-term contract may allow companies to offer a discount, it involves relinquishing all leverage and solvency your school has in the agreement. Once your budget for the following few years has been handed over to your designated EdTech supplier, it’s been irreversibly spent and the control shifts to your technology provider.
In addition to the risk of potential hidden costs, there’s the age-old phrase that if you pay cheap you pay twice; and there’s a danger of doing that when spending tomorrow’s money today. Once your supplier has control, they have much less incentive to support you – whether it’s by improving their product or providing superior customer service.
They know you’re committed to them for the foreseeable future, so why would they invest in improvements? This could lead to you needing to spend even more money as EdTech advances or your requirements change, so your school can continue to thrive in the digital age.
Keep your supplier on their toes
Is the provider you’re signing up with going to be the same company in 3-5 years? Once you’ve signed up to a long-term contract with a supplier, if the company folds, is sold off or relocates abroad, your school is in no position to be able to contest your contractual obligation to them. Not only is this likely to result in further dips in your experience of customer service, but in worse cases this will result in the company folding – in which case you’ll have to source more money to reinvest in the technology you need.
Many of these risks can be mitigated with a rolling annual contract. Because your agreement with a supplier could be replaced within a year, it acts as an incentive for the company you’re working with to provide a better level of service if they’re going to retain your business. More than this, they have to ensure they’re keeping up with technological advancements and enhancing their solution to match their competition – and all whilst offering good value for money.
Benefit from the latest technology
Over the past five years we’ve seen technology evolve at an astonishing rate. Since just 2014 we’ve seen 15 iterations of the iPhone, the release of Windows 10 and a further seven software updates, as well as an increasing emphasis placed on cloud storage, mobile compatibility and enhanced security features.
In Education, the evolution of technology has seen significant advancements designed to improve numerous aspects of school life. This includes the recent rise in the popularity of collaborative learning platforms, which seek to engage students and boost communication between them and their teachers. Two such examples are Microsoft Teams and Google Classroom, both of which offer key tools to help teachers send class materials, set assignments and track student progress – whilst also enabling students to collaborate with their peers, and access and submit assignments online.
If you’d invested all your budget entering into a long-term contract back in 2014, you might have missed the chance to take advantage of top of the line EdTech developments such as these for a number of years, in addition to more sophisticated augmentations of existing technology – such as a rise in cloud-based solutions offering secure and smoother data storage.
As one of today’s fastest-moving industries, technology is in an almost continuous state of progress which could end up leaving you behind. Because of this, it makes sense to keep to an annual contract which allows you greater flexibility when it comes to product and software updates.
The future of short-term agreements
The very nature of EdTech means that it’s under almost constant development, continually advancing to improve the ways it supports us, and this makes it difficult for long-term contracts to continue to be viable economic and practical options in the sector.
To ensure you’re using the right supplier for your school at any given time and are getting the best deals available in the current market, you need to give yourself the flexibility and control that the short-term contract offers you. This will force your suppliers to deliver better resources, improved communications, high-quality support and clear enhancements to their product that follows market requirements and uses the latest technologies available.
Because of this, here at iSAMS, we offer our schools transparent, rolling annual contracts, with no hidden costs or large upfront fees – so, before any money changes hands, you can be confident each year that you’re making the right choice for your school.
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