With the evolution of innovative and smart software solutions that aid massive support and benefit to the business each day. The urge for eProcurement software is undeniable.
Amongst the most eminent features of eProcurement software is the feature of "Contract Management".
Before we discuss the benefits of using eProcurement software for effective contract management, let’s talk about the contract and its importance in business.
A procurement contract refers to the agreement to use different products and services for a project over some predefined and pre-set legally and mutually decided guidelines.
A procurement contract refers to the agreement to use different products and services for a project over some predefined and pre-set legally and mutually decided guidelines.
There are different types of contracts. Among which, these three are the most common and frequently- used types:
In a fixed-price contract, two parties agree on the same price for the specific goods/ materials for a predefined project.
Advantage: You’ll get a guaranteed price. As long as the project scope and other requirements do not change, you’ll continue to get the specific material at the same cost as mentioned in the contract. Regardless of the changing market price. Isn’t that good?
A cost-plus contract is the one in which we pay the contractor all the project expenses plus an additional fee, that could be adjusted in case of increasing cost or other expenses related to those materials/ goods.
Advantage: There is no hassle of arguing a price for a product if it has been increased. Since it is already adjusted while signing this type of contract.
The time and materials contract defines a rough scope of the project where we quote an hourly price and the cost of the materials. The price quoted is slightly high due to the risk factor that is involved in the project.
That is why constant project monitoring and tracking are required to keep a check on the progress of the tasks sheet and materials used.
Advantage: The whole process is transparent and clear to you since you can check the invoices and timesheets to make sure the costs are correct. And it also gives you the flexibility to manage your work according to your time feasibility and work conditions.
Contract Procurement is a process in which a legal bond or agreement is signed between the contractors and the suppliers for the purchase and receiving of goods, or any services required for a project.
It includes the procedures which are carried out by the business while purchasing products or services. This process typically starts when some business need originates and company managers feel the urge to initiate a contract for the respective requirement. It is then created, reviewed, and signed by both parties.
This seems a lot of hassle if done manually; by going from person to person. Isn’t it?
Now here comes the eProcurement software that eases the contract management process and saves a lot of time.
eProcurement software helps to automate the procurement process.
It provides the centralized hub for reporting, transaction tracking, compliance, invoicing, and delivery option, which makes the processing fast and shorten the procurement span.
BusinessBID eProcurement Software provides a centralized solution to all the business procurement processes.
Contract Management is one of the promising features of BusinessBID eProcurement software that gives great flexibility and ease of use to create and manage contracts.
We have dived into this eProcurement software and found the Contract Management Process very smooth. It has got all the processes covered that are required for creating, viewing, and managing a contract.
Let’s take a closer look.
The BusinessBID eProcurement software dashboard comes along with all the necessary features which are used in everyday business.
You can see the Contract option in the e-Sourcing menu. Click on it and you’re all set to go!
You can easily create a contract by:
• Entering the Contract Order Title
• Selecting Contract Type (Time & Quantity Based/ Value-Based)
• Contract Start Date, End Date
• Contract Description (what contract is all about)
You can find all the necessary contact details in the form below:
Once you fill in the general contact information, you can add a list of items.
You can either add items from the database or you can select the external items that you want to order, along with the price.
See the table below.
You may select a list of documents that you might need for a contract.
You can select the supplier from the list of existing suppliers, or you invite a new one as per your requirement.
Once you’re done providing all the necessary details about the contract. You can view the entered details to verify them at the end of creating a contract.
Once you get it checked, you just have to submit it and the supplier at the other end will respond accordingly.
The supplier will receive the contract details and upon reviewing the contract, he can accept or reject the Contract Order.
Once your contract is accepted, you are all set to proceed further by initiating Purchase Order and Invoices.
BusinessBID eProcurement software has made all the business processes very smooth.
Likewise, you can create a PO either from a scratch, or you can select the contract against which you have to create a PO.
See the example below.
We have selected Create Purchase Order from Contract. And the very next screen that appears for entering the information where we have to enter the title for PO and see… we already have our contract listed there for which we can create a purchase order.
After filling out the rest of the required information, your PO is created. You can view it here.
In the Purchase Order dashboard.
Perhaps one of the last steps for the completion of a contract is generating invoices and managing deliveries.
Similarly, we can generate an invoice by selecting the PO that we have created.
You can see the list of the created contracts as well. So generating invoices has become an easier task.
Also, you can add the deliverables too.
And you’re all set to go.
There are many more features that you can explore in BusinessBID eProcurement software, making your contract management much easier than you think!
Contract management contributes a lot to the success of a business. Effective contract management helps in:
- Speeding up the Contract Reviewing, Finalizing, and Execution
- Clear, Transparent, and Smooth Communication between two parties
- Contract Renewal, Agreements, and Changes in Less Time
- Improving Compliance by Reducing Risks using a Proactive Approach
- Prevention and Safety from Privacy & Policy Breach
- Smooth and Legit Document Handling Process
We truly understand the importance of the contract in the business world, and contract management enables you to automate and streamline the process of creating, updating, and managing existing contracts.
eProcurement software helps you to keep a check over things, control and monitor the costs, and the visible results right accessible from a single dashboard. As it assures you that all the materials, goods, or services are provided following the ‘contractual agreement’.
We hope you find this blog useful, switch to the eProcurement software if you aren’t using any, and feel the difference in your business! Thank us later!
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