Does this sound familiar…? You’ve worked hard to identify the best suppliers, negotiate favourable prices and document agreements as contracts, but those advantages and safeguards are lost when purchases are made.
This is often because contracts are not available or apparent to employees at the time of buying. Many organisations have contracts stored in different places, often in paper form. Even scanned documents alone cannot support integration into purchasing systems or automated monitoring.
An important, but often neglected requirement for effective Spend Control is a central repository of supplier contracts. Not only does this drive more on-contract spend (when integrated with purchasing systems), but it enables you to effectively monitor and manage contract details with little administrative effort and cost.
- Increased savings from lower prices due to:
- Greater on-contract spend
- Timely re-negotiation before renewal
- Better information for contract negotiation & consolidation
- Reduced cost of unwanted contract renewals
- Reduced cost of admin support in Procurement & AP
- Increased contract commitment visibility
- Reduced risk of supplier non-performance with contract provisions
Could Contract Management be the missing link in your organisation? Think about…
For further details, see Contract Management: Find, store and manage all your supplier contracts
- How many active contracts are in place today?How many new contracts do you agree per year?
- How do you store and maintain contract details today?
- Do you have an agreed best practice process?
- Do you have any contracts over budget? What %?
- Do you have full audit trail for tender & contract creation?
- How important is the ability to manage contracts ahead of time so that appropriate action can be taken to renew or re-negotiate contractual terms?
- Are standard terms used when creating new contracts?
- What are the risks of automatically renewing or using an expired contract?
- How does a business user know what contracts are in place for various categories?
- What risks & losses are introduced as a result of this?