Key Factors That Determine the Contract Management Software Pricing
Contract management software has proved beneficial in accelerating the contract life cycle, boosting efficiency, managing contracts, saving time, and automating the workflow. Enterprises are making great use of it to save human resources for huge administrative tasks. However, deciding how much to spend on the software per an organization’s needs and terms seems extremely challenging. Thus, knowing the contract management software pricing can ease your selection process.
This article enlists some factors determining the contract management software cost to give a better idea. Let’s dive in to find out.
How Can Contract Management Software Pricings Vary?
Wondering how much does contract management software cost? Well, the contract management software price comparison reveals that the cost of the software varies depending on various features, tools, performance, and user requirements.
The average contract management software price can go from $7.99 to $100,000 annually. However, it’s on you to choose the right contract management software that fits your business needs and budget.
The varying costs per feature can help you select the best software and save dollars that you can spend further to improve the contract life cycle efficiency.
Factors Determining the Contract Management Software Pricing
Some factors determining the contract management software cost are as follows:
The features and functions of a contract management system are the first things to consider when determining the price range. The more features your software instills, the more expensive it will be.
For example, if you want seamless data collection and integration into one system, you will preferably need an expensive approach for managing contracts. A simple tool might not benefit you in this regard. Contract management software can have different features like authoring, workflow automation, reporting, etc.
The Number of Users
The number of users is another essential factor in determining contract management software pricing. Small companies should consider buying contract management software with moderate attributes and price points as they have considerably less staff.
Comparatively, enterprise-level contract management software with broad features, including legal, sales, and procurement team management attributes, costs significantly high. Such high-level software goes best with large corporations.
The storage plans also contribute to the contract management system cost. You may find great variations as some companies charge only for the storage space used while others charge high bucks for unlimited storage. Moreover, you can upgrade your limited storage plan when required.
Both large enterprises and start-ups should have business tools and integrations for strategizing operational efficiency at each level. Different companies use various technological solutions like Salesforce, Microsoft Dynamics CRM, and DocuSign to leverage the contract lifecycle. In that case, you must ensure that your contract management solution supports all your platforms.
Contract management software cost varies depending on whether it supports third-party integrations or not.
Most companies use proper document storage systems, while others ensure encryption and authentication to protect their data breach from hackers.
You should consider how many people will be accessing the system and what kind of access they have. The factors, including multi-factor authentication, IP whitelisting, and single sign-on integration, account for the cost of contract management software.
Contract management software for small businesses is easy to handle and reduces the cost of customer support. Most contracts are one-time deals and do not require regular maintenance or updates.
On the other hand, if you have a wide range of contracts with your customers, you will need to maintain them with the help of customer support. The customer support, including fast response, guaranteed availability, and premium service, may cost you more than usual.
Ease of Implementation
Choosing software that can easily be installed and configured is essential. The software should have an easy-to-use interface and minimum complexity. You can compare these aspects by assessing the resources necessary to set up and integrate an account with other systems.
Either way, you have to pay thousands of dollars for customer support, which will add to the contract management cost.
The brand name speaks for itself and costs accordingly. The contract management cost ascends when you buy from a popular brand compared to an unknown brand. The functioning might be the same, but the pricing is usually high for the one that is appreciated most by the people.
Additional Fees Associated with Contract Management Software
Contract management solutions come with additional costs that are recurring or one-time. The vendors associate extra fees with support, maintenance, and implementation purposes. Most of these include:
1. Integration Fees
The companies charge an integration fee for connecting your contract management software with other business platforms like CRMs and e-signature platforms for a better experience.
2. Implementation Fees
Apart from platform license fees, some platforms charge implementation fees to import existing contracts and train employees to run the software. Implementation fees may go up to thousands of dollars.
3. Optional Feature Fees
Optional feature fees include the premium package, where you opt for services not found in a standard package. These packages include AI automation tools, e-signing, etc.
4. Platform License Fees
The platform license fee is the minimum cost you need to pay monthly or annually to start using the software. Generally, it is fixed but may vary depending on the features and specifications you go for.
5. Customer Support Fees
Customer support fees include the price for any assistance from the company, as you cannot manage the whole software yourself initially. Most companies add it within the software cost, while others don’t.
What is the Cost of Poor Contract Management?
Poor contract management is a serious issue that can lead to lost opportunities, increased costs, and reduced profits. The cost of poor contract management can be very high. According to an International Association for Contract and Commercial Management study, poor contract management costs companies 9% of loss in total annual revenue.
The reasons enlist late payments or missed delivery dates. The list further includes the price of lost sales, hiring additional resources, compensation, and legal fees.
Why is Contract Management Software a Good Investment?
Contract management software is a great investment for any business. It helps you keep track of your contracts and ensure the process is executed efficiently, saving time and resources.
Additionally, it reduces administrative costs, prevents errors, and effectively manages your business’s contracts by automating the steps involved in the process. It also assists organizations in improving their financial performance by ensuring inventory accuracy and reducing costs related to purchasing errors and supplier fraud.
The best contract management software should be the one that meets your needs, not the one that costs you a fortune. Evaluating what you need to obtain the most out of your investment is better.
Hence, analyzing the contract management software pricing is a great step before finalizing the tool tailored to your business needs.