Records Management Blog | Practical Records Management

Permanent Removal Charges : A Dirty Little Secret

Posted by Michael Thomas on Fri, Mar 12, 2010 @ 07:15 AM

Permanent Removal Charges are a little known facet of a Records Management Contract, and worse yet, they're often hidden by an incumbent document storage vendor until you want to move your boxes out of storage.

When it comes time to relocate or shred documents that have been entrusted to a document storage company, typically there is a nasty and little known technicality that suddenly shows it’s ugly face. I prefer to call these hostage fees, but those others more clearly define this as “highway robbery” but in the context of an agreement, I've seen them referred to as Permanent Removal Fees, Document Removal Fees, or Early Termination Clauses (who defines "early?"). 

Whatever you call it, the bottom line is, these nasty fees will have a negative impact your bottom line.

So how did you sign up for this? Well, At some point, between the smiling sales person and the signed agreement a sneaky clause identified the permanent removal charges. It's easy to overlook because it seems benign until you multiply these fees by hundreds or even thousands of boxes you have in storage. Per your agreement, moving your documents now requires a huge fee - sometimes as much as $7.00 per box on top of the standard retrieval charges.

It’s an unfair situation, especially if the vendor has poor service or they have lost records. It seems counterintuitive that you should have to pay to remove your boxes from storage or possibly move your storage account to a different vendor.

How would you know that you are subject to permanent removal charges?  A careful review of your contract may reveal this clause. 

Because some vendors will charge up to two years of storage costs when you request terminating the relationship they rely on the fact that it may be too costly to move the documents, so you wind up staying.

If you are in a contract with permanent removal charges, there is something you can do about this.

1.  Find out immediately if your contract contains a permanent removal charges clause or “permout”. 

2.  If so, to determine how much it could cost to move your boxes or terminate, multiply your boxes by the fee.

3.  Contact your document storage company to find out whether you can negotiate a lesser rate, or if there is a period of expiration.

4.  Talk with another document storage vendor to determine if they will  negotiate on your behalf with the incumbent.

5.  Understand that this is an item to look out for in any new agreement you consider for document storage.

Note: Shoreline Records Management is sharing this information because we believe that our client’s information is their property, and when the client feels it’s time to remove, scan or destroy their records, it’s the client’s decision.  Our policy is that we do not and never will hold our client’s records hostage!

Tags: File Storage, Records Management, Business Strategy