Contract Management for Small Business
Small businesses often don’t give much thought to the key process of contract management for small business. They’re understandably more focused on securing customers than the contracts that come with them.
But one of the most common mistakes made by small businesses is failing to plan properly for growth. If a company has good products, a strong team, and excellent customer satisfaction, they’re probably going to grow. But if a framework isn’t in place to handle the increase in business, the resulting poor performance will lower profit margins, decrease customer satisfaction, and stunt growth.
One important step any small business can take to prepare for the future is to implement an efficient contract management process. Unfortunately, 71 percent of companies can’t locate at least 10 percent of their contracts, according to the
Editor’s Note: To learn more, download our whitepaper on the top 10 contract management best practices.
Contract Management: No Need for Growing Pains
An article on Entrepreneur.com provides an insightful assessment of some of the risk associated with poor contract management: “Misplaced contracts mean you can’t say with much accuracy what your company is obligated to or what you owe in money or services. You could be violating contract terms you’re not even aware of, leading to at least a damaged business reputation — and worse, legal damages and court costs.”
Just as important, poor contract management misses an opportunity to increase productivity. Diligent and intelligent contract management will result in more-profitable terms, greater compliance, and improved customer and vendor relationships.
Many companies find the solution for contract management for small business is contract management software, which provides the ability to easily create, negotiate, execute and manage contracts. It provides immediate benefits to small businesses while also helping them establish scalable contracting processes as they grow. “Any company with more than 10 contracts will benefit from a basic contract software program,” Entrepreneur.com concludes.
The Cloud Leads to the Future for Small Businesses
The good news is that Software-as-a-Service (SaaS) or cloud-based solutions are making the implementation of contract management software affordable to even the smallest of companies. Because of the inherent scalability of cloud-based software, upfront and recurring costs are low. As the business scales, more functionality and users can be added as needed.
In the past, contract management software was largely limited to large organizations who had the resources to implement on-premise solutions with expensive hardware and software. Those days are over thanks to the cloud and SaaS-based contract management solutions. Now even the smallest of companies can benefit from it. And the best part is that as their business grows, so can their implementation of the software.
Since small businesses are resource-constrained, it’s important for them to look for SaaS-based contract management solutions that offer ease-of-use and a helpful support team, so they can get up and running quickly.
Contract Management for Small Business Takeaway
Small businesses can take advantage of contract management software to increase productivity in the present and to prepare for growth in the future. The cost of the software — especially from a SaaS provider — will be more than justified by the increased short- and long-term profit due to productivity gains and better tracking of contracts through all contract lifecycle stages.
