What Are the Benefits of a Contract Manager in Commercial Agreements?

Navigating the complexities of commercial agreements can be overwhelming, especially for busy business owners. Managing these agreements requires a thorough and diligent approach, and a speedy contract conclusion is often business-critical in securing new clients or projects. Appointing a contract manager can bring support and comfort to a business by helping ensure that contracts are completed and run smoothly and effectively. In this article, we explore the role of a contract manager and its benefits for commercial agreements. 

What Is a Business Contract?

A business contract is a vital legal document for protecting any business, regardless of size or industry. It records the terms under which parties will do business and sets out the specific details for the relevant business project. 

A robust business contract, carefully drafted to cover the unique aspects of your business and potential issues you could face, can provide a strong sense of security for your business. 

Without a legally binding agreement, your business will face significant risks and potential problems. A well-drafted contract provides clarity, can help prevent disputes, ensure compliance with legal obligations, and mitigate various risks. 

Why Should Your Business Consider a Contract Manager?

Contracts are vital tools for businesses engaged in trading, but they must be executed, run and managed effectively. 

A contract manager is an individual with expertise in negotiating and managing business contracts. This role can be particularly beneficial for businesses that deal with large volumes of contracts, such as multiple customers. Their key role is to assist with contract lifecycle management—from initial negotiation to contract conclusions and renewals. 

Here are the key benefits of having a contract manager, which can bring your business  peace of mind and great support:

Benefits of Streamlined Contract Negotiation and Delivery

Negotiating contracts can require substantial time and resources. Contract managers use their expertise in negotiation tactics to secure better deals, protect your business interests, and form positive relationships with counterparties.

They can help ensure compliance with contractual obligations, track critical dates, deliverables, and milestones, and oversee governance processes to align contracts with your company’s policies and procedures. For instance, they might negotiate payment terms and other commercial terms or keep a record of contract performance. 

Benefits of Cost Savings

Effective contract management leads to cost savings and financial efficiency. Contract managers can identify cost-saving opportunities during negotiation by securing favourable terms. They also help avoid penalties and fines by ensuring timely compliance with contract terms. By managing contract renewals and customer relationships effectively, they can help secure new business. 

Improved Relationships and Early Dispute Resolution Potential 

Strong relationships with suppliers and clients are vital for successful business operations. Contract managers are often the primary point of contact for all contract-related matters, fostering open and effective communication. They can help ensure both parties understand their obligations and work collaboratively towards mutual goals. Addressing issues promptly and resolving disputes amicably can maintain positive relationships between your organisation and its partners. 

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Despite best efforts, disputes can also arise in any contractual relationship. Contract managers play a crucial role in resolving these disputes efficiently and effectively. They can investigate the cause of a potential complaint or dispute, gather relevant information, and work towards an amicable resolution. Resolving disputes promptly minimises disruptions to your business operations and maintains strong business relationships.

Helping Manage Contract Administration

Administering contracts involves numerous tasks, from document management to performance tracking. Contract managers, through their organisational skills, will help streamline this process. 

Contract managers can add significant value by helping secure, administer, and run your contracts successfully and ensuring you record everything, such as key performance dates or deliverables. 

What is the Importance of Legal Advice in Contract Management?

Every contract carries a degree of financial, operational, or legal risk. While contract managers play a crucial role in identifying potential risks early and implementing strategies to mitigate them, they cannot replace the specialised knowledge of a commercial contracts solicitor. Contracts are, after all, made up of legal terms that only a lawyer can fully grasp. 

Contract managers, assuming they have no formal legal training, cannot provide the in-depth legal analysis and advice a commercial contracts solicitor offers. 

A commercial contracts solicitor will provide solid legal expertise and experience in navigating the complexities of commercial agreements. They will provide vital legal insights that a contract manager might need legal knowledge to look into.

A commercial contracts lawyer can also help your business negotiate contracts, quickly bringing new deals to a conclusion. They can also assist contract managers with this often tricky process. 

As such, while a contract manager is invaluable for day-to-day contract administration and risk management, the role of a commercial contracts solicitor is invaluable for ensuring legal protection for your business. 

Leveraging a contract manager’s day-to-day contract handling skills with a solicitor’s legal understanding will help provide a robust framework for managing your commercial agreements effectively and strategically.

Key Takeaways

Appointing a contract manager offers numerous benefits, including streamlined contract processes, cost savings, improved relationships, and efficient administration. However, the expertise of a commercial contracts solicitor is also essential for navigating legal complexities and ensuring comprehensive protection in your business contracts. 

If you need help with a business contract, contact LegalVision’s experienced contract lawyers as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page.