When a cost review is worth doing
Not every business needs a cost review this quarter. Some do, and the signs are usually visible in your own records before anyone outside looks at them. This article gives you a short test so you can decide with evidence instead of a hunch.
Start with the question a review answers
A cost review compares what you agreed to pay with what you were charged. It does not find new suppliers or cut your budget. It checks that existing contracts, leases and invoices line up. If you cannot say with confidence that they do, a review has something to work on.
A partner firm in our network carries out the work. Fairview connects you with the firm and does not perform the review itself.
Signs that a review is worth your time
Look for these patterns in your own books:
- Invoices for the same vendor that vary month to month with no clear reason.
- Charges for services you stopped using, such as old phone lines, extra pickups or unused licenses.
- Contracts that were renewed automatically and have not been read since signing.
- A lease with pass-through charges that nobody has checked against the lease text.
- Staff turnover in accounts payable, so nobody remembers why a vendor was set up the way it was.
- A recent move, merger, acquisition or system change that moved vendor records around.
Two or three of these together are a stronger signal than one. Each pattern points to a category you can read about: accounts payable audit, telecom and lease audit and compliance are common starting points.
Signs that it can wait
A review costs your team time even when the firm does the analysis. You will gather documents and answer questions. Consider waiting if:
- You are in the middle of a year-end close or an audit of your financial statements.
- Your vendor list is very short and you read every invoice yourself.
- Your key contract is about to be replaced, so a fresh negotiation will reset the terms anyway.
- Nobody on your team can spend a few hours on document gathering over the next few weeks.
Waiting is a reasonable choice. Write down a date to revisit it.
A five-step test
- List your ten largest recurring vendors, including your landlord.
- For each one, find the contract and note the last time someone compared it with an invoice.
- Mark every vendor where the answer is "never" or "I do not know."
- Add up how many are marked. If it is most of the list, a review is likely worth discussing.
- Pick the one or two categories with the most marks and read the matching category page.
This test does not estimate any amount you might recover. Outcomes depend on your records and on what the review finds. If a firm offers a figure up front, ask how it was reached. [CONFIRM: a partner firm supplies and approves any statement about typical outcomes]
Think about what a review needs from you
Most reviews need the contract and any amendments, a payment history for each vendor, and sample invoices. You also stay involved when findings are presented and when corrections are discussed with the vendor or landlord. Read what happens after you submit a request to see where your time goes.
Note: A review of fees and charges is not a legal opinion. If a finding turns on how a clause is interpreted, ask your own counsel. [VERIFY: whether your contract requires notice before disputing a charge]
Deciding and acting
If the test points toward a review, choose the request path that fits your business. Larger and smaller businesses use different forms, and the request a professional page explains each one. If you are unsure which applies, the "not sure" path sends your request to Fairview for manual matching. There is no fixed size cut-off between firm types..
Any fees are agreed between you and the partner firm under that firm's own terms. Some recovery-style reviews are priced as a share of what is recovered and others use fixed fees, according to a provider's own description of the field. Ask the firm which applies to you. [CONFIRM: a partner firm supplies its fee model]
To compare fee models in more detail, see contingency fee versus flat fee.
Tell us what you need reviewed. We match you by hand with an independent partner firm. You keep your existing vendors.Find out what you are overpaying.