Contracts
A Contract in CommitCRM defines the service agreement with your customer, which helps you manage the way you charge your customer for services and track the status of the agreement. Each Contract is always related to an Account.
CommitCRM Contracts are categorized according to their type:
- Global
- Block of Time
- Block of Tickets
- Block of Money
The contract type is set when you create a new Contract, and the system automatically tracks the status of a Contract according to the type selected. You can read more about contract types and their statuses in Tracking the Contract Status.
Each Account can have one or more Contracts at a time for different purposes. For example, you can have a Block of Time service agreement for on-site support at the customer site, and also a Global Contract for phone support.
Each Contract also has a Start date and End date which determines when the Contract is valid or expired (i.e. out of date). CommitCRM automatically selects the most valid Contract – see How does the system choose the Contract to be used. To view Contracts which are about to expire, go to the Reports window, select the Contracts category and generate the 'Contract List by Type and Expiration' report.
Note that using Contracts is optional, and should only be used if needed – see the next section, When to use Contracts.
If you don't have special contract terms with your customers and you bill according to ad-hoc charges per activity, you can simply use the Global System Contract which allows you to skip the Contract definition step and go straight to Charges. This System Contract is a global Contract which is automatically created for each Account so you can avoid having to create and manage contracts yourself.
When to use Contracts
Contracts are optional. CommitCRM Contracts are useful for managing your service contracts and tracking their statuses in the following cases:
- You have a service agreement which needs a Contract (for example a Block of Time contract, a Block of Money contract, etc.)
- You use recurring service agreements, such as monthly billing. See a more detailed explanation in Recurring Contracts.
- You manage complex Projects which include various Tasks and Charges. For example, you are building a new network infrastructure for a customer with various hardware and software installations.
For more information and advanced usage tips for Contracts, see Managing Projects using Contracts and How to use Recurring Contracts.
Contract Fields
The following table explains the Contract fields and their usage:
| Field | Description |
|---|---|
| Contract Type (mandatory) | A Contract can be created under one of the following types:
The contract type is set when you create a new Contract, and the system automatically tracks the status of contracts according to their type. Read more about Tracking the Contract Status|Tracking the Contract Status. When adding Charges for a Contract, the Billing flag will be automatically set according to the Contract type. You can read more in How is the 'Billable flag' determined. |
| Contract Code (mandatory) | The Code field is the unique ID of a Contract, which can contain numbers and letters as desired.
The Code field is used for the following:
|
| Contract Name (mandatory) | The Name field describes the purpose of the Contract. This field is displayed whenever viewing the Contract in various windows (e.g. when creating a new Ticket).
The Contract Name is a non-unique identifier (you may have several Contracts with the same name). |
| Start Date (mandatory) | Indicates the date the Contract starts being active and can be used for Charges/Tickets.. |
| End Date (mandatory) | Indicates the date the Contract stops being active and should not be used for Charges anymore. The system will warn the user when an expired Contract is being used for a Ticket/Charge.
Also, the system will automatically select the most appropriate Contract according to the relevant dates. Read more about How does the system select a default Contract. |
| Description | The Description (Desc.) field holds the description of this specific Contract. The Description is displayed whenever selecting to use this Contract (in a new Ticket window) and in the Ticket's Contract/Asset tab. |
| Internal | The Internal field holds internal comments about the Contract, which will be displayed only to employees (Customers viewing the Contract via the Web Interface will not see this field).
The Internal comments are displayed when a Contract is selected for use (in a new Ticket window), and in a Ticket's Contract/Asset tab. |
| Default Items | It is possible to set default Items (per Parts, Labor or Expense) to be used when adding Charges to the Contract. Using default Items streamlines adding new Charges - the default Item will be automatically selected when creating a new Charge. The user can then modify the Item if needed. |
| Linked Activity Template | Each contract in the CommitCRM system can be assigned a "Linked Activity Template." This template can be linked to a contract and applied whenever a user copies this contract to a new date range or creates a new contract based on the contract to which the template is assigned. See the Activity Templates user guide for more details. |
| Status | The status field may contain the following possible values:
In a typical lifecycle, a contract will start as Active, and when it passes the End Date, it will be set as Completed by the employee handling the Account. Suspended and Canceled statuses are to be used for special cases. For example, if a customer has not yes paid a debt and should not be receiving regular support, or if the payment agreement has been modified and a new Contract has been issued instead. If any of these statuses are set, the system will warn you when attempting to use this Contract for new Tickets/Charges. |
| Used x out of y | When the Contract is a "Block of…" contract, the field next to the Contract status will show the status of the block. For example, a Block of Time Contract will display the amount of used hours out of the block (for example "Used 3 out of 15 hours").
When the Contract exceeds it's terms, this text will appear in red. |
| Contract-Price Charges | The Contract Price allows you to define charges which are the actual contract payment for the contract itself. This way you can invoice your customer for the contract from within CommitCRM. You can read more about this in Contract-Price Charge section. |
| Custom Pricing | If you define Custom Pricing for a Contract, each time you create a Charge for this Contract, CommitCRM automatically pulls up the correct custom price for it. Contract's Custom Pricing replaces the Account's Custom Pricing (if defined). You can read more about this in Custom Pricing section. |
Contract-Price Charges
Contract-price Charges provide an easy-to-use and innovative way to ensure that clients get billed for the service contracts you have signed with them, whether they are recurring contracts or ad-hoc contracts/projects.
Contract-price Charges are used to charge for an amount agreed upon in a contract. For example, let’s say you sign a 50-hour (block-of-time) contract with a customer for a price of $1,000. You can then create a Contract-price Charge to represent this amount ($1,000) in the CommitCRM system. A Contract-price Charge only represents an amount listed for a contract—it does not represent a fee for specific work performed under a contract.
Contract-price Charges work much like other charges in CommitCRM: they are included in reports; they can be defined as Billable; and they are included in invoices. However, since Contract-price Charges do not represent specific work, they do not affect the balance of a contract block. For further explanation, see Contract-Price Charges Features below.
Tracking the Contract Status
An Active Contract can exceed the Contract terms, depending on the Contract type. Each Contract type has its own limitations and once the Charges or Tickets added to the Contract exceeds the limit, the system warns the user before adding any more Charges/Tickets.
The Contract Type is set when you create a new Contract, and the system automatically tracks the status of contracts according to their type:
- Global - The Global Contract allows the use of an unlimited number of Charges of any type. The only limitation for Global Contracts is the contract end date. A typical usage for this type would be a phone service contract which is valid for one year.
- Block of Time - Block of Time Contracts are suitable for contracts that agree upon a limited and predefined block of service time. Each Charge added to this Contract will decrease the time remaining for this Account.
- Block of Money - Block of Money Contracts are suitable for contracts that agree upon a limited and predefined sum of Money or for "all-included" service agreements. Each Charge added to this Contract will be deducted from the original sum of money.
- Block of Tickets - Block of Tickets Contracts are suitable for contracts that agree upon a limited and predefined block of service Tickets. Each Ticket added to this Contract will subtract one Ticket from the original block of Tickets.
Certain charges will automatically be deducted from the contract, such as the addition of a new Charge to a Block of Time Contract, which will reduce the remaining time in the Contract. This also applies to money in a Block of Money contract, and so on.
When you create a Ticket under an active Contract, the system will warn you if the contract terms are out of date, for example, if the Block of Time allocated has already been used or if the end date has passed.
You can see the current status of the Contract in the Contract General tab, near the Status field (for example "Used 3 of 12 Hours"). In case the Contract has exceeded its terms, the status will appear in red (for example "Used 13 of 12 Hours").
|
Custom Pricing for Contracts
Custom Pricing lets you set special pricing for different Accounts or Contracts. Once you define custom prices for an Account or Contract, these prices will be used automatically for every charge logged for Accounts or Contracts. You can also manually adjust the prices while creating a charge.
You can read more about this under Custom Pricing.
Activity Templates for Contracts
Each contract in the CommitCRM system can be assigned a "Linked Activity Template." This template can be linked to a contract and applied whenever a user copies this contract to a new date range or creates a new contract based on the contract to which the template is assigned.
When should it be used?
Linked Activity Templates can be useful for situations in which you want to copy a contract with all its data (the block terms, contract-price, etc.) along with a set of activities that are typical to this contract.
For example, if you have a monthly service contract that requires you to perform the same actions each month (on-site visit for preventative maintenance, server checkup, etc.), you can simply assign a Linked Activity Template to that contract. By attaching the template, every time you renew the contract for the following month, all of the monthly Tasks, Tickets, and Appointments associated with this template can be automatically created as well.
Another possible use for Linked Activity Templates would be in preparing predefined plans to offer to new and existing customers. Each plan can be defined as a Contract, linked to your business account record. Whenever a customer purchases a plan, you can simply copy the predefined contract, including all the predefined terms and activities, and create an actual contract for the customer.
Each of these predefined contracts would already include all of the plan terms—custom pricing, default items, special internal terms, block size, etc., as well as a linked activity template, which defines all the activities that needs to be done once an actual contract based on this predefined one is signed. All you would need to do is copy the predefined contract to a new one and apply the Linked Activity Template.
See the Activity Templates user guide for more details.
How does the system select a Default Contract?
When adding a new Ticket or Charge for an Account, the system will automatically select a Contract for the new Ticket/Charge. The parameters which the system considers when trying to find the valid contract are the Start and End Dates of the Contract.
This feature saves you time and helps you enter new Charges and Tickets quickly, without the need to manually select a Contract.
In order for the system to automatically select a contract by date, the Account should be set to 'Automatic' default Contract selection (this is the default behavior for new Accounts).
When no Contracts have been created for an Account, or when there are no other active Contracts, the 'Global System Contract' will be used automatically. This is a Contract that is created for each Account by default.
Note that this is especially useful for recurring contracts (e.g. Monthly Contracts), because CommitCRM will use a new copy of the previous Contract (which is valid for the next date range (see Recurring Contracts). In this case, the Account will have several copies of the Contract with different date ranges. The system will only start automatically selecting the Contract with the new date ranges when the previous Contract expires.
Forcing a Default Contract for an Account
You can set a default Contract for an Account, which will always be used by default when adding new Tickets or Charges to the Account. This option should be used only in cases where you always want to use the selected contract. We do not recommend using this option unless necessary.
To manually set the default contract for an Account, open the Accounts window, navigate to the relevant Account record, click on the Contracts tab, select the Contract you want to set as default, right-click on it > Default Contract > 'Set selected contract as the default contract for this account'.
Copying Contracts
Copying contracts is useful for renewing a completed contract or for using a pre-existing contract with another customer who receives similar terms.
When copying the contract, this copies the following data:
- The contract's basic data, such as the contract terms, the linked account, etc.
- The contract's Contract-price Charges
- The contract's default activity template, while applying the activities for the newly created contract
Copying contracts can be done in two ways:
Renewing Contracts With the Batch Copy Wizard
This option copies a group of contracts to the next date ranges. This method is generally used to renew contracts for the same customers. Note that if you are not familiar with the Batch Copy Wizard, it is recommended to review the Recurring Contracts section first. You can also watch the Copying Recurring Contracts video to familiarize yourself with the contract-renewal process.
Using the manual single copy
This option copies one contract at a time. This method is generally used to create a new contract for a different customer.
You can find more information on copying Contract-price charges along with the contract in the Copying and Renewing Contract with Contract-Price Charges section. Copying Contract-price charges along with the contract provides you with many benefits.
You can also find more information on copying activity templates along with the contract and creating the activities automatically in the Activity Templates user Guide, under Copying Contracts With Linked Activity Templates section.