Contract Renewal 101: Everything You Need to Know

contract renewal

You’ve done your part of the deal, and the other party has fulfilled their obligations. It’s official: your contract is coming to a close. So what’s next? You can either conclude the agreement and chase after new clients, or nurture this existing relationship and renew the contract.

If you’re looking into contract renewal and are unsure how to go about it, don’t fret. In this article, we will walk you through renewing contracts and provide you with some important insights to ensure a seamless transaction.

 

Table of Contents

 

What Is Contract Renewal?

As the name suggests, contract renewal occurs when an initial agreement ends and all parties decide to continue their business relationship. Typically, a contract includes a provision that explicitly states the duration of the validity and effectivity of the deal. In some cases, exact dates are specified, while some conclude after all the obligations are fulfilled.

There are two ways in which you can proceed with the renewal process:

  1. The contracting parties can continue with the old terms from the previous agreement.
  2. They can renegotiate and draft an entirely new contract.

In some cases, there are contracts that automatically renew once it’s gone past the stipulated duration. There’s usually a clause found in the previous agreement that states so.

Why Is Contract Renewal Important?

While looking for and locking in new clients promote growth, there are a lot of untapped opportunities that come with contract renewal. Not only does it offer a steady stream of income for your business, but it also allows you to evaluate your performance.

Once the contract is up for renewal, you can get insights into the aspects where your business fell short. From this, you can come up with better solutions to help you improve your processes. Moreover, you also have the opportunity to change the terms in case the old ones are no longer as favorable to you or the other contracting party.

How to Manage Your Business’ Contract Renewal Process

It’s no secret that managing contracts is one of the most laborious and time-intensive tasks that one has to undertake. When it comes to the contract renewal process, it is crucial that you devise a strategy to ensure a smooth transaction.

Here’s how to do it:

1. Do not wait until the last minute

You must keep track of your contracts’ expiration dates to know when you should start the renewal process. As much as possible, you need to give yourself at least a couple of weeks to organize everything.

Review the terms ahead of time. Start drafting the new contract weeks before the existing contract concludes. This way, you’re not pressed for time in case significant changes need to be made. You also avoid unnecessary stress.

2. Skip the manual contract renewal process

One of the great things about managing contracts in this day and age is that there is no shortage of helpful tools and software that can make your life easier. With that said, it’s time that you switch to a more digital approach to renewing contracts.

Instead of printing out documents and mailing them to the contracting parties, opt for an electronic signature request instead. It saves you so much time. You also do not have to spend a lot of money on courier services.

3. Include the right persons

In such a critical process as contract renewals, it is important that the right people are involved. The more people you include, the more likely you are to encounter delays and complications.

As much as possible, keep your team small. This makes it easier to keep track of the progress of the contract renewal process. It also helps to clarify their roles and responsibilities, so everyone knows what they are accountable for.

4. Establish open communication with your client

You need to be completely transparent with your client every step of the way. This ensures everyone is on the same page and happy with the terms and conditions.

Open communication with your client helps things move quickly and smoothly. It also fosters trust and loyalty, especially if you hear their concerns and implement their suggestions in the new contract.

5. Seek assistance from your legal team

It always pays to have a team of experts to help you out. Dealing with contracts can be complicated. The same goes for contract renewal, especially if there are major changes to the terms.

If paying for a retainer is beyond your budget, you can find lawyers who can review your agreements for you on a per-project basis. You only pay for their service when necessary.

Speed Up Contract Renewal Process With Fill

As previously mentioned, having the right tools in your arsenal can help expedite contract renewal and management.When you sign up with Fill, you can simplify your contract-signing process while minimizing your operational expenses.

Moreover, adopting a digital approach to contract management ensures that your documents remain confidential. Fill uses military-grade encryption and other security measures to thwart any attempted breaches, unauthorized access,and document alteration.

With Fill, you do not have to write contracts from scratch. You can save time by using any of our customizable contract templates. We have a comprehensive list of different agreements from rental agreements to employment contracts.

Other innovative features you can find in Fill include:

  • Signer identity verification
  • Third-party integrations
  • Online forms
  • Custom branding
  • Cloud storage sync

Enjoy all these and more when you create an account with Fill. Sign up today.

Related Stories

electronic signature software comparison

Electronic Signature Software Comparison: 2023 Best Guide

what is the key to success for hipaa compliance

What Is the Key to Success for HIPAA Compliance?

What is the key to HIPAA compliance? Find success in your compliance strategy by following the HIPAA main points in this comprehensive guide.

Get great articles direct to your inbox

    We’ll never share your details with third parties.
    View our Privacy Policy for more info.

    Arrow-up