Latest / The Buyer's Side with Fexingo: Procurement, Sourcing, and B2B Purchasing Decisions
How One Buyer Used Price Escalation Clauses to Survive Inflation
When inflation spiked in 2021-2023, many procurement teams got burned by fixed-price contracts that didn't account for rising raw material costs. But one industrial buyer at a mid-sized manufacturer used price escalation clauses to protect margins across 40 supplier contracts, saving roughly $2.3 million in unexpected costs over 18 months. This episode walks through how they structured the clauses — using publicly available indices like the Producer Price Index for plastics and metals — and the negotiation tactics that made suppliers agree. Lucas and Luna also discuss the pitfalls: vague…
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