How do I check how many shredding clients are on locked-bin contracts?
Ask for the full client list with contract type, start date, term, renewal terms and the bins at each site. Mark which clients have locked bins on a recurring schedule and which are one-off or on-call. Then read a sample of the contracts to confirm the list matches the paper.
The list the seller gives you is a summary. The contracts are the evidence. Ask for each locked-bin agreement and check the same things every time: who the contracting party is, how the term renews, how either side can end it, whether pricing can change and whether the contract can pass to a new owner.
Cross-check against billing. A client who has a locked-bin contract should show regular charges that match the bins on site. If invoices are irregular, find out why. A client on paper may have quietly cut back, or may pay only when someone calls.
Look at how revenue splits between locked-bin clients and on-call or one-time jobs. Locked-bin accounts tend to feel steadier, but only if the contracts are current and the clients are happy. Ask which accounts are close to renewal and which have complained. Talk to the seller about equipment too. Locked bins are assets placed at client sites. Count them and ask where each one is, and what happens to them if a client leaves. Ask who services the locks and who holds the spare keys. Ask which clients have asked for changes recently.
Key takeaways
- Match the contract list to the signed contracts and the invoices.
- Check renewal, termination and transfer terms in each agreement.
- Count bins on client sites and confirm who owns them.
- Ask which clients are close to renewal and which have complained recently.
Related reading
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Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
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