Mon, 23 December 2019
Why Your Contracts Are Not Working and How To Fix Them!
Ever ask yourself why your contracts are not working and wondered how to fix them? Jason Kren is the man with the answer to that frequently asked question.
Sales people want nothing more than to see their contracts and deals turn into a close. Unfortunately, there are times when the inefficiency of getting contracts signed can delay income or prevent a closing all together. How can you make this process more streamlined so this doesn’t occur? Jason Kren’s company PactSafe could be the solution you’re looking for.
PactSafe is a company that was built from the ground up. They manage clickwrap contract acceptance at scale. This means they have the ability to manage millions of clickwrap contracts at a super high velocity.
An example of this type of contract is illustrated by Disney+. The company recently launched its video streaming service and opened with 10 million subscribers in the first 24 hours of launch. At the end of the sign-up process is a contract that states the terms and conditions of the service that users are getting. These contracts are often the highest valued contracts that a company’s legal department manages on an annual basis.
Jason’s company takes this type of contract and utilizes the PactSafe platform. It’s a quick wrap embedded contract and once it’s accepted, the platform will track the version that’s accepted. Using the platform, they can track the time when the contract was accepted and who accepted it. PactSafe can also reproduce what the contract looks like on an individual screen and know whether the contract is downloaded on a mobile device, computer, or tablet.
In terms of sales contracts, this platform makes things run smoothly. With just one click, users have signed a legally binding agreement.
In the sales application, this same type of contract and platform can be used to speed up the process for sales.
Making contracts easier to understand
Sales people and legal departments can partner together to make a contract more user friendly and understandable to the customer so closing is easier. The first step is for sales leaders to talk to the legal department about contract design. This includes the language used in the contract, down to the words and phrases, so the contract is easier to accept and lessens the points of negotiation. Ultimately, this removes friction from every step. Moving toward a standardized contract in the contract design includes multiple components that should have the end result in mind. Efficiency and speed of acceptance by the customer is the goal.
These contracts are often in order forms for upsells and cross-sells within the organization.
Adopt a standardized language
A key area to review when moving toward a standardized system for contracts is reviewing the areas that don’t need to be negotiated each time. These areas can already be written and in place each time. Contracts such as these are better for the customers and for the salesperson. While the legal team handles the design of the contract, it’s the sales team’s job to change the language used in presenting the contract to the customer. Most salespeople today are still using archaic language when talking about contracts. An example is “I’m going to send you the contract and once you’re done reviewing it and signing it, we can start.” You want to streamline the process. Sending the contract over for a potential client to dictate the turnaround time can lead to a delay in closing and waste time.
With a new design the approach changes to “The contract is ready to go. I’m going to send you its link so you can click on it and we’ll get started.”
It eliminates having to talk about the contract and you’re sending the terms they just have to accept. That little shift in your language can increase velocity and reduce the friction of the contract process.
Moving away from PDFs
Another key change that salespeople can make is to move away from cumbersome PDFs. When you try to close a deal using this archaic method of sending over the contract via signature platform it is costing you money. If your prospect is traveling and they’re on the road with only their phone available, they won’t be able to move through the contract because they still have to go through a PDF process to sign off on certain points. This delays the closing by 48 hours or more.
The better alternative is to standardize and minimize your contracts by moving to a clickwrap, one-button acceptance system. By doing that, you increase your customer experience and your deals.
When running a particularly high-velocity business, you should know the components that make up your sales velocity equation. If you can tweak these areas then the results can reflect a massive increase in your business and customer satisfaction.
Reducing the friction
When you can speed up your contract process by one or even two days, that will increase your overall sales velocity. Embedding an email with a link to the contract and sending them as a ClickWap eliminates the unnecessary process of opening a PDF format and having it digitally signed. The clickwrap is more efficient for the salesperson and the client. Removing these delays will greatly improve your overall revenue.
It’s true some businesses can’t let go of the signature contracts altogether because there are some transactions that still require negotiation, such as large enterprise deals. However, smaller deals such as non-negotiable customer agreements, can use standardized contracts to reduce friction in the sales process.
In the sales spotlight - DoorDash and BMC
DoorDash is one of the companies using PactSafe’s services. DoorDash has three primary groups who enter into contractual relationships with dashers, the people who deliver food. One group includes the restaurants who provide the food. DoorDash has a massive sales division to call the managers of restaurants so they can be enrolled as dash merchants. These restaurants can then have their food delivered by DoorDash and expands what can be offered to the consumer. These end users are the people who download the app.
Restaurant managers don’t have time to review a contract in the traditional PDF format. They’re often on their feet and checking that everything in the restaurant is in order. There is no time to check their computers and respond to an email containing a PDF they have to read through in order to sign off. Jason’s company worked with DoorDash and their sales team is now sending contracts through a clickwrap which is so simple and efficient. It eliminated the whole e-signature workflow.
The massive enterprise software company, BMC, didn’t have centralized control of the contract acceptance process across dozens of their product lines. They needed a third-party to control and enhance their contracting process. Enter PactSafe. They eliminated more than 10,000 different forms for BMS’s 14 products. This gave BMC’s legal department the ability to regain control over any changes to agreements that didn’t require code changes and it provided them the visualization and analytics they needed.
When you think about efficiency for your own business, you’re not only transforming your legal team but you’re also transforming your sales team. This creates a frictionless digital transformation across the organization.
Creating the pilot program
Changing how an organization works requires effort. Jason suggests that before making any permanent changes, create a pilot program. It’s important to test a new launch with a subset of your sales team so they can help refine the process by making sure it works before you roll it out to the whole organization.
In sales, you only have one shot to launch well so make sure the new system is ready to go. Having a smaller section of the sales team try the new system can offer valuable feedback and once it’s ready to launch, they can be your greatest cheerleaders in moving the entire team forward.
Updating the process of closing a contract can lead to massive increases in efficiency, revenue and turnaround. For any companies who have high volume contracts, one-clicks are the way to go.
“Why Your Contracts Are Not Working and How To Fix Them!” episode resources
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