A contract is an agreement that imposes obligations on both parties. But when does a back-and-forth negotiation turn into a contract that holds up in court? Legislation and past cases have developed many essential rules that every business owner should know.
Companies enter into contracts as a routine part of business. But some contractual elements could put your business at risk for breach of contract, negative financial consequences and more.
“Initiate a proper handshake and the whole world opens up for you.” ― James D Wilson
Contracts form the cornerstone of your business. They are formal promises between parties, essential agreements that govern every aspect of your daily operations. Contracts are not simply legal technicalities: They can also set the tone of a relationship. Choosing to uphold your responsibilities in a contract, and the actions you take when obligations are not met, both say a lot about how you do business.
An eContract, or electronic contract, is a legal document created and signed online. It is essentially a digital version of a traditional paper contract. As with paper contracts, eContracts are agreements signed by two parties. They are enforceable and legally binding documents that are typically used regarding employment, sales, services, or tenancy. With a typical paper contract, one party drafts an “offer” and the other party reads over it. If both parties agree to the terms and conditions listed in this initial offer, they will each sign the document and it becomes a valid contract. Each party must hold up to their end of the agreement or they face the risk of legal recourse. This is no different with an eContract. Although a paper copy is not presented, a digital signature still enters both parties into a legal agreement.
If you need a more convenient and secure way to get your documents signed, a digital signature platform is the answer. Digital signatures provide technical advantages over traditional contract-signing methods and are fully enforceable in court. An online digital signature platform helps you quickly and efficiently integrate them into your business.
Contract management software is designed to make life easier for legal, contract managers, and business users. And it does – once it is implemented. An experienced software vendor can help make your implementation a success, but your organization is a crucial partner in that work. Here are four tips for ensuring that your contract management software implementation is a success.
Where contracts are concerned, leakage is the difference between the value expected from a contract and the value realized in its implementation. For sell-side contracts, this is usually termed revenue leakage, since the goal of the relationship is to make money by providing goods or services. (Procurement or buy-side contracts experience leakage in terms of value or savings, the chief goals for contracts negotiated with suppliers.)
Getting contracts done faster is a front-and-center goal when adopting contract management software. One way this is accomplished is through automated workflow that puts each contract-related task in front of the right person just as soon as the previous task is completed. Alerted by email (or a task queue in a dashboard), each person logs in, opens the contract
For most companies, procurement is an essential yet often difficult business function that relies on an efficient contract management process to be successful. Getting what you need from vendors and other clients requires careful contract management that is best accomplished with advanced contract management software. If you are still relying on basic email or spreadsheets to manage your procurement process across multiple departments, you may be losing time and money.