When considering business growth strategies, the first question many ask is, How can we get new clients?
But have you calculated your company’s cost of new client acquisition versus client retention? Research has found that:
So, the wiser question to ask yourself is, How can we retain our CURRENT customers? That’s where contract renewals are vital for your business—and why it’s critical to be efficient and skilled at managing them!
Contract renewal discussions should happen well before the contract expires—and not immediately before—to reduce the chance of bad timing. By avoiding a last-minute renewal, the relationship with your client can be further strengthened as this feels like an extension of the relationship.
Whether you manage contract renewals in-house or outsource them, your process must be easy for existing clients. This can be one of the most sustainable business growth strategies when handled correctly.
However, organizing client contracts, tracking renewal dates, and scheduling contract reviews and renewal discussions also require significant time and energy. Read on for three crucial tips for delivering top-notch contract management.
You’ll first need the proper tools and systems to keep contracts organized and maintained. While setting these up requires a lot of heavy lifting, they’ll ensure your business proactively stays on top of renewals.
Every successful contract renewal process is proactive! Schedule renewal reminders based on the length of your client’s contract. Start having these conversations before the renewal date to discuss their needs, how the product/service has worked for them, and ensure you can continue meeting their needs.
Find out if the customer has found value in your subscription. This is a prime time to address and eliminate potential barriers by ensuring the process is easy, presenting all their options, and providing the best solution for their current goals.
You must create automated workflows with Contract Lifecycle Management (CLM) technology to establish an efficient contract renewal system. For example, contract review, renewal, or approval workflows allow your team to see the status of each contract, who’s managing it, and receive related notifications.
Research shows that while a contract approval takes an average of 3.4 weeks, CLM software shortens this time significantly. Speed up the process for both your team and your clients with the following tools:
Many companies now use automatic renewal systems, which should be used strategically and cautiously. While a manual contract renewal process requires significant time from your contract managers or relies on the customer renewing on their own, it also allows you to strengthen relationships with customers through one-on-one engagement.
Of course, the primary benefit of automatic renewals is that they offer a proactive, streamlined solution. Customers enjoy a quick and easy process, not having to reenter their payment information and ensuring they don’t forget to renew. Businesses that use automatic renewals increase retention and revenue, experience growth, and save time.
However, some customers will want a consultation or need to upgrade their plan before renewing. If their service automatically renews, you could miss an opportunity to increase their revenue. Again, this is why sending renewal reminders is critical!
Does establishing these contract management tools and systems seem overwhelming? Fair enough—it’s a lot of work. However, outsourced call centers already use these tools in their contract maintenance services. Plus, they’re proficient in navigating them and handling customer retention.
Another key to getting customers to sign contract renewals: sufficient customer sales knowledge and experience! A contract renewal discussion is another type of sales conversation in which you must know how to deliver a high-quality customer experience.
Always be sure to:
Simultaneously, you need to remain organized and keep the process moving closer to a signature. Timing and the art of communication are pivotal, as with any aspect of sales.
Refining sales skills, particularly with contract renewals, takes significant staffing, training, and time. But outsourcing a contact center to manage the entire process for you will be a game-changer for your business efficiency. You and your staff will have more time to focus on your areas of expertise. And chances are, you’ll see more successful client renewals because call center employees are specially trained in sales.
Outsourcing your contract renewals can save your company time and bring in more money, thanks to higher renewal rates! But how do call centers do it?
When it comes to company growth strategies, contract renewals should be at the top of your list—but that doesn’t necessarily mean you should manage it in-house.
Poor contract management costs companies 9% of their annual revenue. What would that amount be for your organization?!
With an expert partner to maintain your contract renewals, you can experience:
Chameleon has expertise in contract maintenance renewals. We even know how to promote them for our clients, helping them upsell and cross-sell to increase revenue! Our experienced team will gladly take that heavy lifting off your plate. Learn more about our contract renewal services or contact us today!