Creating Contracts

There are 2 primary types of Contracts in ServiceTrade: Default Contracts and Company Contracts.

• Default Contracts define general pricing for jobs for which there is no Contract specific to the Job's customer or subcontractor. 
• Company Contracts define pricing between your company and a customer or subcontractor. 

It's important to remember that Item Prices are stored in Contracts and NOT in the Item List. You can add an Item's Cost (the cost you pay, not the customer). We cover pricing in this Support Article.

Default contracts can be manually selected when building a quote or invoice. Company contracts apply automatically. 

Note: Addendum Contracts define prices that override prices on other contracts to which they are attached. Addendum Contracts are typically needed only in complex subcontracting situations and are a legacy feature and will be removed soon.

Creating a Default Contract

1. Hover over Customers in the Navigation Bar.
2. Click on Service Contracts to navigate to the Contracts page.
3. Click the Create Contract blue link.
4. Click Create Default Contract from the pop-up menu that appears.
5. When creating a Default Contract the required fields are:
   • Contract Name: the searchable name for the Contract you are creating. 
   • Owner: the name of the User who is creating the Contract.
     (Vendor will auto-populate with Your Company's name unless otherwise specified.)
6.  Once all desired information has been provided, click the green Create button.
7. You are now ready to begin adding pricing information, which is covered in Managing Prices with Contracts.

Note: When creating a Default Contract it is important to remember NOT to add info into the Job Type, Will Be Applied To Invoice For, and Parent Contract fields. These fields are only relevant for Company-Specific Contracts.

Only use At Locations Assigned to Office and At Locations Belonging to Region if the default contract is for locations for that specific Office or Region. These are discussed in the section below.

Creating a Company Contract

Company contracts are really useful. They can be used to create unique price lists, rules, expected revenue/margin, etc, for a customer or location. They are commonly used to record your Service/Maintenance Level Agreements for locations or companies.

Example: You may have an SLA for three years where you will perform quarterly maintenance for a service location. You could use a Company contract that is for that specific service location and job type 'Preventative Maintenance.' Then, you would set your start/end date, expected revenue/margin, payment terms, and salesperson/owner, all from the terms of your contract. If you had any special pricing, rules, or notes you could also set those here.

Overtime, if you assign all the recurring services, jobs, and invoices that are associated with the SLA to this contract. The contract will collect data like actual vs. expected revenue/margin and provide you a way to review all of the invoices. The review on date allows you to search when you need to review, analyze, and attempt to renew this contract using the data you have collected:

Once the contract has been created, you can define the exact cases wherein this contract will be used on quotes, invoices, services, and jobs.

1. Hover over Customers in the Navigation Bar.
2. Click on Service Contracts to navigate to the Contracts page.
3. Click the Create Contract blue link on the left-hand side.
4. Click Create Company Contract.
   
5. You will see a nearly similar menu when creating a default contract with a few exceptions. Enter the field below and click Create when done:
   
   Below are the definitions of all of the available fields when creating a new Company-Specific Contract:

You will also notice a check box for the Template Contract. If you only want this Contract to be a template that you copy to create other Contracts from, and don't intend this Contract to apply to a customer directly, then you would check the box. 

When creating a Child Contract, you must specify which Parent Contract to inherit from. For more info on Parent and Child Contracts check out our article on Service Contracts and Inheritance.

Managing Prices with Contracts

Adding Prices for Items is a key component when creating contracts. Since this is so important we have dedicated an entire article on Managing Prices with Contracts.

Contract Status

The contract status section on the top right side of the page will give you an overhead view of the contract you are viewing and how it is performing.

Important Note: Default Contracts do not have or show Expected Revenue, Invoiced Revenue to Date, Expected Margin, and Actual Margin. This is because default contracts act as your standard price lists and are not suited for calculating your account overhaul revenue or margin. We recommend using the Invoice List Search page and exports to run reports like that.

• Valid Until - Lists the contract's Expiration Date.
  Note: The ends on date does not invalidate the contract. You will still be able to assign the Contract to Quotes, Jobs, and Invoices. However, the expiration date will appear in red when this is the case.
• Expected Revenue - Lists the contract's Expected Revenue your Company expects the Contract to make throughout its life. This can be edited or added when creating or editing a contract
• Invoiced Revenue to Date - Lists the sum of all invoiced revenue to date on active invoices from invoices associated with this contract.
  • Important Note: This does include paid, partially paid, and non-paid invoices.
• Expected Margin - Lists the percentage margin that you expect this contract to achieve. This can be edited or added when creating or editing a contract.
• Actual Margin - Lists the percentage margin that this contract achieves. The actual margin is calculated by comparing the job item costs on completed jobs for that contract with the invoiced revenue for that contract.
  • Actual Margin = ((Invoiced Revenue - Job Items Total Cost on Complete Jobs) / Invoiced Revenue) x 100
  • This is rounded down to the nearest tenth decimal place. So, for example, if your actual margin is calculated at 50.4131604968%, it will be rounded to 50.4%.
  • The expected and actual margin of each contract are now also included in the contract list export:
    

Note: To view expected and actual margins, users must have permission to see both job labor and non-labor costs, permission to view invoices, and permission to view contracts.

FAQs

How do I Track Customer Purchase Orders on Company Contracts?

Read this article for more information on Tracking Customer Purchase Orders on Company Contracts.