What is a Contract?
Definition
Legal agreement between buyer and vendor defining terms, pricing, deliverables, responsibilities, and termination conditions. Software contracts include master service agreements, statements of work, service level agreements, data processing addendums, and order forms. Key contract provisions cover liability caps, data ownership, termination rights, renewal terms, price escalation, and dispute resolution. RFPs create the framework for contract negotiation by establishing requirements and evaluation criteria.
Why This Matters
Contracts define your recourse when vendors underdeliver. Without favorable contract terms—liability caps, data ownership rights, termination flexibility, pricing protection—you're locked into unfavorable relationships. Your RFP creates the contract negotiation framework. Include must-have terms upfront rather than negotiating from vendor's standard agreement where you have minimal leverage. Contract quality determines your options when problems arise.
Related Terms
Showing semantically related terms from our RFP knowledge graph. Priority connections are highlighted.
Essential Connections
Master Service Agreement
RFP Fundamentals
A contract establishing terms and conditions for ongoing vendor relationships including pricing, payment terms, intellectual property rights, liability, termination clauses, and dispute resolution.
Service Level Agreement
Pricing & Total Cost
Contractual commitments defining expected service quality including uptime guarantees, response times, resolution timeframes, and penalties for non-compliance.
Contract Negotiation
Pricing & Total Cost
The process of finalizing terms with the selected vendor including pricing adjustments, SLA modifications, customization scope, payment terms, and exit clauses.
Contract Management
Software Features & Capabilities
Software managing contract lifecycle from creation through renewal including template libraries, approval workflows, e-signature, obligation tracking, renewal alerts, and repository search.
Legal Agreement
RFP Fundamentals
Legally binding contract between parties establishing rights, obligations, and remedies.
Contract Lifecycle
RFP Fundamentals
Contract stages from negotiation through renewal or termination, including execution, performance monitoring, amendments, and closeout.
Statement of Work
RFP Fundamentals
A detailed project document defining deliverables, timelines, milestones, responsibilities, and acceptance criteria for software implementation.
Procurement Lifecycle
Pricing & Total Cost
The end-to-end process for acquiring software including needs assessment, requirements definition, RFP creation, vendor evaluation, contract negotiation, implementation, and ongoing management.
Vendor Selection
Vendor Management & Evaluation
The systematic process of evaluating and choosing software vendors based on product capabilities, security compliance, implementation support, company stability, and pricing.
Contract Execution
RFP Fundamentals
Formal signing and activation of contract between buyer and vendor.
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Related RFP Templates
Explore our top RFP templates - all 75 templates include questions about contract