Fleet Tracking Services Contract Traps (and Tips to Get Out of One)
GPS fleet tracking services should be an ongoing partnership—not a decision you’re stuck with.
How’s this for irony? Match.com, a site that made its name helping singles take their time and meet lots of people—so they don’t commit to the wrong person—just got sued for unfairly locking customers into long-term contracts.
According to the California lawsuit, some of the tactics Match.com used to trap subscribers included:
- Hiding the auto-renewal clauses deep in their contract’s fine print
- Eliminating the legally required notices about consumers’ right to cancel
- Creating a long and tedious cancellation process
We bring this up because other fleet tracking services language uses the same tactics in their contracts. Here are some things to beware of when you consider signing up for a fleet tracking service.
Don’t let these GPS contract horror stories happen to you.
“You didn’t ask to cancel in time, so… two more years!”
This seems to be the most common strategy some fleet tracking services use to keep customers locked in for years and years. Time and time again, we hear from prospects looking to switch from their existing GPS provider after learning their contact had mysteriously renewed without their knowledge.
Buried somewhere in the text of the long-term agreement, the contract will state that the subscription automatically renews on a certain date. To cancel, the customer must proactively contact the provider a number of weeks or months in advance. And of course, the provider won’t send any reminder that the contract is ending, or the cancellation window is closing.
“Don’t worry. You can get out of it anytime. Trust us.”
A prospect signed up with a different provider becoming they made the switch to ClearPathGPS. While the general manager was negotiating terms, he asked if they could cut the contract period from the standard two years down to one. “We can’t do that. But the length of the contract doesn’t matter because you can get out of it anytime,” the salesperson claimed.
Technically speaking, this claim was accurate. What the contract stated was that the customer could buy their way out anytime. What's the cost? The entire amount remains on the contract.
In this case, when the business finally decided it had had enough of the fleet tracking services provider’s poor service—there were 13 months remaining on the agreement. That meant the company would have to pay $6,825 to end the relationship.
“Hey, we never said this contract was based on our performance.”
What if you find a few months into your multi-year contract that your fleet tracking services provider has poor customer service?
It's crucial to see reviews on the experiences of working with that solutions provider. For many of these providers, the goal is not to create a mutually beneficial relationship and deliver you the best service month after month. Instead, their aim is to lock you into a long-term contract that delivers them revenue month after month, regardless of how they treat your company.
“Sorry, but the ups and downs of your business aren’t our problems.”
Most GPS fleet tracking plans are rigid. If you sign up to track 25 company vehicles for their plan, you’ll be paying the same monthly amount for all 25 vehicles—all year, year after year of the contract—even during those periods when your business is normally slow or even shuts down completely.
This poses challenges for landscapers, roofers, tree trimmers, and other service businesses whose businesses are seasonal. It’s frustrating to pay the same fees for GPS service when they know that some of their vehicles will be parked for a few months each year.
“… and no, not even the pandemic will loosen our contract’s terms.”
In fact, a lot of businesses just learned this fact during the 2020 pandemic. Many of them contacted their fleet tracking services providers and asked to suspend their service because their vehicles were sitting idle. Of course, those providers said no.
“Oh, and if we change the contract and it hurts you, you might still be stuck with us.”
One customer showed us the language of their previous fleet tracking services provider agreement. They gave themselves the right to adjust the contract while it was still active—even if the change had a “material adverse effect” on the customer. (Translation: we’re changing the rules we all agreed on.)
- The provider promised to notify the customer about the change only 14 days before it went into effect. (Translation: don’t expect a lot of advanced warning)
- If this happened, the customer had the right to protect itself against only that portion of the agreement that was changing. (Translation: and don’t think this means you can end your contract.)
- The worst part: The customer could protect themselves from the changing rules only if they called the provider before the change went into effect (which could be 2 weeks). (Translation: if you don’t react fast enough, you’re locked into the new changes)
Note: The “1 new vehicle auto-resets entire agreement” sleight-of-hand.
Some GPS companies use a variation of this trick to keep you locked into their contracts longer than you’d like. Here’s how it works. Somewhere in the contract’s legal language, the provider will include a clause that states if you add a new vehicle to your existing 25-vehicle service (even if it's just 1 new vehicle), that change automatically restarts the GPS agreement to two or three more years—not only for the new vehicle but for all 26! Beware of this one. It has ensnared more than one business we’ve talked to over the years.
Avoid the fleet tracking service trap with these 5 questions:
1. Does the fleet tracking service provider offer options other than a long-term contract?
Better to keep your company’s options open and find a provider that will work with you month to month and won’t demand you commit to them in advance for years. (ClearPathGPS offers flexible plans including month-to-month options).
2. Will the contract require a proactive renewal from you, or will it auto-renew?
If your GPS provider prefers to keep its customers locked in with automatic renewals forever—or until they ask to cancel—you should assume that the company doesn’t pride itself on outstanding customer service that keeps businesses loyal to them. (ClearPathGPS talks with you 90 days before your renewal to find the right path forward for you).
3. Will the fleet tracking services provider let you suspend service for a period of time?
If your company has a need to temporarily pause your GPS service, such as when business slows down, you want a provider that makes this easy. (ClearPathGPS flexible plans include an option to let you pause service on a few, most, or all of your vehicles anytime, and can cut the monthly fee for those trackers to $5 per month until you’re ready to resume service).
4. Has the company earned a reputation for outstanding service?
And while we’re talking about customer service, don’t sign up with any GPS provider—especially not one that demands a long-term contract—until you’ve heard from businesses like yours what it’s like to work with them. (ClearPathGPS has a 4.9-out-of-5 average rating on TrustPilot).
5. Does the contract hold the provider accountable for their performance?
Why sign a long-term contract that you can’t adjust—or terminate—if the vendor doesn’t provide outstanding service? (In some cases, we’ve even made accommodations to help customers stuck in contracts but eager to start working with ClearPathGPS—such as delaying their billing to make the transition easier).
Similar to Match.com customers who didn’t realize they were being locked into long-term agreements—the same unfortunately happens with businesses using fleet tracking services. That’s why it's important to not only read the fine print but do your diligence in vetting reviews, understanding, and asking the right questions before you get locked into a business relationship that won’t get you the results you need and deserve. Learn more about how ClearPathGPS provides unparalleled customer service by downloading our free eBook. Or, connect with one of our product experts by requesting a demo.
At ClearPathGPS, we are focused on helping our customers improve their operations and bottom line. Our top-rated GPS fleet tracking solutions provide real-time data insights and tools needed to more effectively manage the vehicles, people, and assets businesses send into the field every day. Can ClearPathGPS help your operations get better results? Let’s find out – request a demo today!