Sell-side and buy-side contracts are some of the most common contracts out there, but what are they and how do you manage them?
The difference between these two types of contracts is fairly self-explanatory, as ‘Buy-side’ contracts involve things you buy, while ‘sell-side’ contracts handle sales between you and your customers. But of course, it isn’t as simple as that.
Each side differs in purpose but they are comparable in other ways and both can benefit from contract management software (CMS) - read on to find out how.
What is a sell-side contract?
A sell-side contract is used to manage the sales and delivery of goods. This is the most common type of contract used by a sales team in a business, due to this they are often produced at scale, particularly in the case of SaaS contract management.
Sell-side contracts are one of the main components in generating revenue, and as such they require close monitoring and management. This can be a difficult ask for smaller businesses with limited resources, as they need to review every contract.
This can include reviewing and amending:
- Contract templates for sales teams
- Contract wording for upselling
- Contract renewal terms
- Approving language for terms and conditions
Sell-side contracts are essential to any business that relies on subscriptions or sales - which is most businesses! Poor contract management can lead to delays and compliance issues, this is where a good CMS comes into play.
Using contract management software to manage sell-side contracts?
The main advantage of using a contract management platform for sell-side contracts is time-saving.
Sales teams can self-serve on sell-side contracts to speed up the process and improve your sell-side contract turnaround times. A platform like Juro enables users to:
- Create from contract templates pre-approved by legal
- Allow legal teams to oversee contract negotiation with ease
- Keep up to date with contract versioning
- Create a single contract repository
- Accurately manage contracts from within your CRM
- Track contracts and their obligations post-signature
What is a buy-side contract?
A buy-side contract, as the name suggests is an arrangement made to purchase goods or services from a seller in exchange for something, usually money. The most common department to use this in a business is procurement.
Procurement teams can be involved in:
- Strategy management
- Contract management
- Vendor selection
- Sourcing and order management
- Strategic compliance
Buy-side contracts can be fairly simplistic, especially if they are for lower-value products or a low recurring cost. This means teams can standardize these contracts using a template, like this supplier agreement template, making it easier for procurement teams to self-serve and also simplifying contract negotiation with counterparties.
However, there are also examples of more complex buy-side contracts which could require additional supporting documents - this can be using Juro. Automating this process makes it simpler to keep track of these agreements and also means you can adapt an existing template, as opposed to starting again from square one.
Complex buy-side contracts should be sent complete with all relevant attachments, such as a request for a proposal.
Using contract management software to manage buy-side contracts?
This is where a CLM tool can come in handy, as there are numerous benefits to using a CLM to help manage buy-side contracts. Most notably, using a CLM can help to align your procurement team with legal and finance by:
- Confidently tracking purchase and buy-side agreements
- Moving approvals of purchases into one system
- Creating a unified space to negotiate deals with vendors and counter-parties
- Ensuring that all deals are paid for following the contract terms
- Tracking and managing discounts in existing contracts
Procurement teams must be able to easily track spending especially when buy-side contracts differ by supplier or source. Creating and storing these in one unified CRM streamlines this process.
Managing each with a CLM tool
Both buy-side and sell-side contracts can be managed more effectively in a CLM tool like Juro. Despite their similarities and differences, there are key elements of these contracts that can be simplified by automation, from contract creation, negotiation and signing to relationship management between suppliers and vendors.
The right CRM tool can automate elements of this process and pull it all together, handling both sell and buy-side contracts in one place. This can lead to improved cross-functionality between departments when you manage your contracts in this way.
The advantages of managing sell-side and buy-side contracts in one place
There are so many advantages to managing these contracts in a CLM, for example, users can:
- Pay for one system. Your whole business benefits from a unified contract management system, from legal and sales to HR and procurement. Buying one system for the whole company makes sense on both a practical and financial level.
- Streamline processes. Everybody has the same process and system for managing buy-side and sell-side agreements, meaning work is not doubled and ensures efficiency.
- Access better relationship management. Better management of relationships with third parties, especially those who act both as a supplier and a customer of your business.
- Align teams. All data is shared in one place so an increase in sales could triggers an increase in purchases of materials, for instance.
- Create a contract repository. Combines contract and document management into a single, easy-to-access repository.
Though you may invest in a CLM tool to use for one department, many businesses access benefits for multiple departments and contract types. The right software, implemented correctly will see a return on investment fast.
Managing sell and buy-side contracts with Juro
Managing sell-side and buy-side contracts should be straightforward.
With Juro, you can create automated templates that allow you to collaborate in real-time, access secure cloud-based storage and create buy-side and sell-side contracts up to ten times faster.
To learn more about how your organization can streamline the creation of your buy-side and sell-side contracts with Juro's all-in-one contract management platform, click the button below.