IMPORTANT: contract drafting is reserved for lawyers and this document is given for information purposes.
As an archiving and management tool, the contract library allows you to centralize and track all your commercial contracts efficiently. Thanks to it, reduce your contract management time!
Everything you need to know about the digital contract library and commercial contracts
When managing a business, contracts are numerous and their management requires time. In fact, we often waste precious minutes searching for the desired contracts and arranging them in an orderly fashion.
In this article, we will discuss two points. The first will be about the contract library (its role and importance) and the second will deal in detail with commercial contracts.
Digital contract library: what is it and what are its benefits
Definition of the digital contract library
As its name indicates, the digital contract library is specialized in contract management. It allows to centralize all the contractual documents of a company in the same place and to keep them safe. Archiving is therefore its primary function!
Among all the company contracts that you can archive in the contract library, we can mention :
- Commercial contracts.
- The various employment contracts.
- Contracts concerning company statutes
The advantages of the contract library
Let’s see now what are the advantages of the digital contract library for a company:
- All contracts are stored in one place
The contract library is a wonderful document management solution and its main advantage is to centralize all contracts in one place. This way, you and your employees have easy access to the documents you need.
- Reduction of financial losses
A bad follow-up of the contracts can generate financial losses. Indeed, it sometimes leads to forgotten payments, and therefore, financial penalties. Also, this lack of follow-up can cause the loss of interesting partnerships (if you forget to renew your contracts).
Thanks to the digital contract library, the follow-up is assured!
- Time saving
The contract library saves time because it avoids wasting precious minutes looking for a specific contract.
- A more economical solution
The digital contract library allows you to dematerialize all your contracts, and consequently, to reduce the cost of paper and ink.
- A better growth of the company
By using a contract library, you save money and time. The money saved and time saved can then be invested in business growth.
Focus on commercial contracts
In this second part, we’ll talk more specifically about the commercial contracts in your contract library!
What is a commercial contract
Commercial contracts govern the commercial relationship between a seller and a buyer in order to secure transactions.
The establishment of a commercial contract usually takes place when launching a business or when working with another provider.
Among the wide variety of commercial contracts, we can mention sales contracts, of course, but also franchise contracts, subcontracting contracts, or even, service provision contracts.
The clauses of the commercial contract
Commercial contracts are not drafted at random: they must include certain clauses.
Let’s look together at the mandatory clauses of commercial contracts:
- The purpose of the commercial contract
This is an essential element, because it defines precisely what the contract is about. Without it, the contract simply does not exist.
- Duration and effective date
This is another essential piece of information in a commercial contract! Indeed, the signatories must know how long the contract is valid: is it for a temporary or indefinite period?
Also, the effective date is of utmost importance, because the duration of the contract starts from this date.
- Dispute resolution
It is from this clause that the parties having signed the contract will be able to establish solutions to the possible litigations (mediation, conciliation…).
- The price
This clause concerns everything related to the price. It allows to determine the price of the services and its different modalities.
- Resolutive clauses
They determine the conditions of the end of the contract in case the obligations are not respected.
- Penalty clauses
If one of the parties does not respect the terms of the contract, it will have to pay a sum of money determined by the penalty clauses.
- Indexation clauses
Their purpose is to provide for a possible variation in a contract value (price…).
What are the main commercial contracts?
Here is a description of the main commercial contracts in the business world:
- The partnership contract
The partnership contract is concluded between two companies to collaborate on the same project. The duration of this collaboration is variable. This contract must indicate the object, the contact details of the different parties, the duration, the settlement of disputes, the price, the terms of execution and termination.
- The contract for the provision of services
The purpose of this contract is to define the rights and obligations between a service provider and the client. More concretely, the signature of the contract implies two things: the client must pay the service provider, and the service provider commits to provide the service requested.
- The subcontracting contract
The subcontracting contract is established when a company (principal) asks another company to carry out tasks which are its responsibility for the benefit of a customer or another company.
- The contract for the sale of goods
This contract covers the transfer of property (sale of products).
- The transfer of patients
This contract is made when a health professional transfers his patient base to another health professional exercising the same activity (doctor retiring…).
- The distribution contract
This contract occurs when a producer asks a company to market its products.
- The licensing contract
The license contract sets rules when the owner of a trademark or a patent allows another person to use his products or services.
- The IOU
The document is drawn up by a debtor who undertakes to repay a debt.
- Contracts: for computer services, website design, commercial agent
These contracts are drawn up when the company calls upon the services of an IT service provider, a web developer or a sales agent.
- The contract of business contribution
This contract is drawn up when a business contributor is paid a commission to promote the company’s products or services.
- The freelance contract
This contract sets out the rules for the missions carried out by a freelancer.
You now know more about the digital contract and business contracts. It’s up to you to make the most of them to make your business prosper!