When Service Contracts Fall Short
A warehouse automation system is one of the most important investments you’ll make. But like any major investment, its performance depends on the quality of service supporting it. Too often, companies sign a service contract at installation and never revisit it—even as their needs evolve, technology advances, and business pressures change.
The result? A contract that no longer fits the operation, leaving leaders frustrated with rising downtime, escalating costs, and reactive support that doesn’t keep up with demand.
So how do you know if your service contract is still protecting your investment—or quietly working against it? Let’s explore five signs that it’s time for a review.
1. Downtime Is Becoming the Norm
Service contracts should reduce unplanned downtime, not leave you constantly scrambling. If your system is experiencing frequent breakdowns despite being under contract, it’s a red flag that preventative care isn’t happening.
One food manufacturer PeakLogix worked with had a contract that looked strong on paper, but response times were slow and preventative inspections were rarely completed. After shifting to a PeakLogix program, unplanned downtime dropped by nearly 40%—not because the equipment suddenly improved, but because the service strategy finally aligned with their needs.
2. Emergency Costs Are Creeping Up
Another warning sign is when emergency callouts and rush repairs are becoming more common. A good service agreement should minimize emergencies by catching issues before they escalate. If you’re paying out of pocket for repeated after-hours calls or rush-ordered parts, your contract may not be delivering the preventative value you’re paying for.
Think of it like insurance. You’re not just buying coverage for a breakdown—you’re investing in peace of mind that breakdowns will be rare. If you’re still facing emergencies every quarter, something isn’t working.
3. Response Times Don’t Match Business Needs
In today’s supply chain, waiting days for a technician to arrive is unacceptable. If your contract promises fast response times but fails to deliver, it’s time to ask tough questions.
We’ve seen companies lose critical business because their service provider couldn’t get onsite quickly enough to prevent major delays. By contrast, a healthcare distributor we partner with relies on our 24/7 emergency support and has maintained a 99.7% fulfillment rate—even during system outages—because technicians were dispatched immediately.
4. Recommendations Are Outdated—or Nonexistent
A strong service partner doesn’t just fix problems. They advise you on how to optimize and modernize your system as your business grows. If your service provider isn’t proactively recommending upgrades, retrofits, or training, they may not be invested in your long-term success.
Modernization is often the difference between an outdated system that struggles to keep up, and an operation that scales confidently with demand. If your contract doesn’t account for this, you’re likely leaving performance—and money—on the table.
5. Your Operation Has Changed, But the Contract Hasn’t
Perhaps the most common sign it’s time for a review is simply growth. If your throughput has doubled, your SKU count has exploded, or you’ve expanded into new facilities, your service needs have changed. A contract written five years ago may no longer be relevant to today’s environment.
In these cases, the contract isn’t “bad”—it’s just outdated. But the effect is the same: your operation is underserved at the exact moment it needs support the most.
Why Reviewing Your Service Contract Matters
At PeakLogix, we believe service contracts should be living documents—reviewed and refined as operations evolve. The best agreements don’t just check a box for compliance. They deliver measurable results: reduced downtime, predictable costs, reliable response times, and proactive system care.
If any of the signs above sound familiar, it may be time for a service contract review. Not to start from scratch, but to ensure your investment continues to deliver value as your business grows.
