Contract renewal clauses are included in almost all contracts. These are important factors. In other words, companies should take care to streamline their renewal process. Establishing efficient processes with contract management software can save time, increase revenue, and strengthen business relationships.

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What is contract renewal?

One of the most important clauses of the contract is the term of the contract and its renewal. Before your contract expires, you should start thinking about your contract renewal process. During this period, you and the other party will have the opportunity to review the legal arrangement and use the current terms or renegotiate the contract. This includes ensuring that the price quoted is fair and that the goals are still aligned between the parties.

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Contracts that typically require renewals-

• Leases
• License agreements
• Promissory notes
• Insurance policies
• Non-disclosure agreements
• Master services agreements
• Vendor agreements

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The legality of auto-renewal contracts

Automatic contract renewal clauses generally provide that the contract will renew on a specified date unless either party terminates the contract. Automatic renewals are governed by Section 5 of the Federal Trade Commission Act Governing Deceptive Business Practices. In most cases, these regulations help protect consumers.

Contract renewal process: Recommended course of action

Renewals can be a great opportunity to generate revenue if used correctly. That means you need to know how to proactively renew your contract. Implementing renewal process best practices will ensure good business relationships and take advantage of renewal opportunities.

Here are some tips for getting the most out of your updates-

• Track deadlines and avoid contract review delays
• Communicate with business partners and build strong relationships
• Consider the company's current goals and needs 
• Pay attention to contract performance 
• Weighing the merits and demerits of continuing a business alliance 
• Benefit from Automating the Contract Lifecycle

Benefits of using contract renewal management software

The best way to get the most out of updates is to implement a CMS. The software automates the entire process and provides valuable insight into the performance of each contract. Contracts are tracked throughout their lifecycle, making it easy to determine if a contract is worth renewing.

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Here’s why your business needs to implement contract lifecycle management software for renewals:

Effective oversight of obligations-

Making sure all partners are compliant and keeping the end of the deal is time-consuming when you have to manually review all the documents. An intelligent management process automates this process and provides visibility into all contractual obligations, from critical deadlines to compliance.

Less negotiation-

Renewing an existing contract means saving the company time and resources spent through the negotiation process. Leverage automation tools to further streamline the negotiation process. These tools allow you to negotiate remotely without having to meet with the other party to negotiate the terms of the contract.

Maximize business relations-

The most successful companies are those that recognize the importance of strong partnerships. One can easily strengthen your existing relationship by extending your contract with the partner.

Easier revenue capture and forecasting-

A solid understanding of your financial situation is essential for any business. Sales forecasts are important because they help you develop a strategy to grow your business. However, this is difficult to estimate manually. CMS runs the process, takes last year's revenue, and uses it to forecast next year's growth. This allows you to renew your contract if necessary.

Less paperwork and friction-

Want to get rid of the dreaded pile of paper on your desk that has accumulated over the years? When you switch to a digital update process, you no longer have to worry about keeping track of various physical documents. Additionally, because the redlining process can run on the platform, document versions and changes can be tracked, greatly simplifying the overall update process.

Using SpeedLegal’s CMS to manage the contract renewal process with ease

Many companies still manage updates manually or use only partial automation. The result is a time-consuming, labour-intensive and error-prone task. Using an automated platform streamlines this process, freeing up your time and resources to focus on creating profitable deals and delivering a better affiliate experience.

Some of the most beneficial contract renewal automation features that SpeedLegal offers are-

1. Automated deadline notifications and reminders.
2. Advanced oversight into agreement performance.
3. Simple communication and collaboration.
4. Centralised storage.
5. Assistance at every step.