Most larger corporations of a certain size would probably switch their agencies / suppliers / manufacturers over such a late fee construct. They'd laugh in his face and walk off. "Ah you have a problem doing business with us? We know 100 other companies that would LOVE to do business with us".
It's not unusual for larger companies to call for a 10% reduction after a couple of years. "Considering the size of our mandate, our generous contracts in the past, we think it would be appropriate for you to lower your prices in the future. By the way, last weekend I was at this cocktail party and my wife introduced me to John Lasseter. Doesn't he run ACME CORP, one of your competitors? Pretty funny guy that John... And smart!!!"
Of course you should never allow a business relationship to grow to a size where its rupture might impair the health of your company, but seriously, this isn't always possible.
It's not unusual for larger companies to call for a 10% reduction after a couple of years. "Considering the size of our mandate, our generous contracts in the past, we think it would be appropriate for you to lower your prices in the future. By the way, last weekend I was at this cocktail party and my wife introduced me to John Lasseter. Doesn't he run ACME CORP, one of your competitors? Pretty funny guy that John... And smart!!!"
Of course you should never allow a business relationship to grow to a size where its rupture might impair the health of your company, but seriously, this isn't always possible.