Contract Management Software and Procurement Solutions

Procurement and contract management is the term associated with the process of acquiring goods and services from suppliers and managing the contracts that define all the transactions with those external suppliers. Procurement ensures sourcing, purchasing, and vendor selection, while contract management ensures that paperwork is properly executed, created, and monitored according to relevant compliance.

A procurement and contract manager is responsible for overseeing purchasing activities and establishing strong relations with the suppliers and vendors. At the same time, they also take care of contract negotiation, supplier performance monitoring, budget management, compliance checks, and resolving disputes.

Contract development in procurement talks about the entire process of structuring, drafting, and finalizing the agreements with vendors, suppliers, and other stakeholders. It includes preparing terms and conditions, establishing timelines, and defining the deliverables while ensuring the relevant compliance.

The four common types of procurement contracts are-

• Fixed Price Contracts- It ensures that procurement is carried out on a predefined price instead of the real-time actual cost.
• Cost-reimbursable Contracts- These contracts encourage the payment of actual costs with a fee.
• Time and Material Contracts- This type of contract ensures payments on the basis of time and resources spent throughout the procurement lifecycle.
• Unit Price Contracts- It defines payments on the basis of a per-unit price.

Here are the four types of procurement management-

• Direct Procurement- Includes sourcing the raw materials and goods for production.
• Indirect Procurement- Consists of purchasing services, utilities, or office supplies.
• Goods Procurement- Talks about the acquisition of physical equipment and products.
• Service Procurement- Contracting with professional consultants and labor.