Enterprise Contracts: What to Know Before Executing

Key takeaways:

• Recognize that enterprise contracts differ fundamentally from standard agreements through their greater scale and complexity requiring multiple departments, extensive negotiation with legal involvement in 85% of cases, and significantly higher risk where poor management can erode up to 9% of annual revenues.
• Include essential legal components when creating enterprise contracts by documenting dates, identifying all parties, defining consideration, spelling out detailed terms for payment and duration, and verifying legality, enforceability, and appropriate acceptance methods.
• Adopt digital contract management systems to eliminate the inefficiencies of manual processes that leave 80% of procurement functions unaware of competitive terms, providing centralized storage, automated deadline tracking, and searchable repositories that transform contracts into strategic advantages.
• Utilize automated workflow tools to reduce contract cycle times from four weeks to one week by standardizing templates across departments, creating automated guardrails for low-risk contracts, and eliminating time-consuming manual review processes.

Enterprise contracts are legally binding agreements between businesses that involve complex terms, extensive customization, and high-value transactions. These contracts form the backbone of every organization’s operations, with some companies having 90 percent or more of their annual revenues represented in contracts with suppliers and vendors. Unlike standard agreements, enterprise contracts require significant negotiation and personalization to address specific business needs. They encompass various contract types including bills of sale, construction agreements, partnership deals, and procurement contracts.

The challenge is that getting these contracts right requires more than just putting terms on paper. You need to make sure they express the desires of both parties, comply with relevant laws and regulations, and—most importantly—are legally enforceable. Since drafting, negotiating, editing, and executing your enterprise contract requires a lot of time and energy, meeting all of these goals can be difficult. This is why you and your team should adopt advanced contract management tools like Ironclad Editor to speed up and simplify how you create and execute enterprise contracts.

Read on to learn more about enterprise contracts and how to create and manage them. By the end of this article, you’ll also learn how to use Ironclad to manage and simplify the enterprise contract lifecycle.

What is an enterprise contract?

An enterprise contract is a complex legal agreement between businesses that involves substantial value, extensive customization, and detailed terms tailored to specific organizational needs. These contracts differ from standard agreements in their scope and complexity.

What makes them different is the level of stakeholder involvement and financial commitment. Enterprise contracts typically include multiple stakeholders, require extensive negotiation, and involve significant financial commitments. They must be documented in writing or digital format to ensure all parties understand their obligations. The complexity stems from the unique requirements each enterprise brings to the relationship.

At their core, enterprise contracts function as binding promises where parties exchange value through products, services, or payments. However, these agreements require significantly more customization than standard contracts.

The key difference lies in complexity and personalization. While simple contracts like eCommerce checkouts use standardized terms, enterprise contracts demand extensive customization. Each agreement must be tailored to address specific business requirements, regulatory needs, and risk profiles.

This is where template limitations become apparent. Even when starting with a template, you’ll need to modify most standard language and draft custom terms from scratch. This customization requirement reflects the unique nature of each enterprise business relationship.

Given their complexity, enterprise contracts appear in many different contexts whenever two or more parties agree to exchange a product or service. As such, enterprise contracts can come in any shape and form, including:

• Bills of sale
• Construction contracts
• Promissory notes
• Equipment and property leases
• Partnership agreements
• Employment contracts, including contractor agreements

How enterprise contracts differ from standard contracts

You might be thinking, “A contract is a contract, right?” Not exactly. When we talk about enterprise contracts, we’re talking about a different beast altogether compared to the routine agreements that cross your desk. The main difference isn’t just the dollar value; it’s the complexity and the stakes involved.

Here’s the breakdown:

• Scale and complexity: Standard contracts, like a simple software subscription or a one-off purchase order, are usually straightforward. Enterprise contracts, on the other hand, often involve multiple departments, complex service level agreements (SLAs), and long-term strategic partnerships. They’re not just transactions; they’re foundational documents for major business relationships.
• Negotiation and personalization: You can often get away with a template for a standard contract. But enterprise deals are almost always heavily negotiated. For instance, Master Services Agreements (MSAs) often require legal involvement in 85 percent or more of cases, according to The 2025 Contracting Benchmark Report. Each side redlines terms, from liability and indemnification to data security and termination clauses. They are highly personalized to reflect the specific risks and goals of the deal.
• Risk and impact: The risk associated with a standard contract is usually limited. If a small vendor fails to deliver, it’s an inconvenience. If an enterprise-level cloud provider has an outage, it can bring your entire operation to a halt. The potential business impact is orders of magnitude greater, which is why the scrutiny is so much higher; in fact, poor contract management can lead to an erosion of value equal to nine percent of annual revenues.

Think of it this way: a standard contract is like buying a coffee. An enterprise contract is like designing and building the coffee shop itself. Both involve an agreement, but the level of detail, risk, and long-term planning is worlds apart.

How to create an enterprise contract

Creating an enterprise contract requires including specific legal components that ensure enforceability and clarity. While enterprise contracts vary significantly based on business needs, all must contain these essential elements to be legally binding:

Start with the basics. The date typically appears in at least two parts of the contract. The first time it appears, it should be at the top or beginning of the contract, to indicate when the contract was created. The date should also be at the bottom of the contract, next to each party’s signatures to indicate when they signed the contract.

Identify the parties. You then need to list who the parties to the agreement are. Mention whether they are corporations or individuals and which party is the seller or buyer.

Define consideration. Consideration is a general statement of what the product or service provider is doing for the buyer. For instance, if the buyer is paying $5,000 for a used car, the consideration is the used car.

Spell out the terms. Terms are highly personalized, present detailed information about the business deal, and are the most important part of the enterprise contract. The terms will vary from one agreement to another, as they outline the specifics of the deal, but you would typically include the following:

• How much the buyer is paying and what the service provider will be doing for the buyer in return
• The length of the contract
• Whether the contract can be canceled and how it can be canceled
• What happens if a party dies or is unable to complete their side of the agreement
• Whether the parties will use arbitration, mediation, or a mix of both to resolve any future issues

Once you have your basic outline covering these points, you’ll want to review your draft for critical legal requirements:

• Legality: Is there anything in your contract that may not be legal? Check the laws, rules, and regulations of your jurisdiction or the chosen jurisdiction of the transaction to make sure.
• Enforceability: Is your contract enforceable? For your contract to be legally enforceable in court, it needs to have a legal purpose, establish mutual agreement between the parties, have valid consideration, and involve legally competent parties that came to an agreement of their own will.
• Acceptance: How will your contract be accepted? Will you be using traditional eSignature, clickwrap, or embedded signing? Think about which form of acceptance best fits your contract. For most enterprise contracts, you’ll probably use traditional eSignatures, since enterprise contracts are non-standard, negotiated agreements that require a level of customization.

Once you’ve touched on all of these features in your notes, it’s time to start writing the first draft of your enterprise contract. Be as detailed as possible without being overly wordy—contracts are meant to be easily understood by all parties. Look over your draft two times before moving on to the next stage of the contract management lifecycle—contract negotiation.

Managing enterprise contracts

Here’s where things get tricky. Managing enterprise contracts becomes exponentially more challenging at scale. Organizations dealing with hundreds or thousands of active contracts face significant operational hurdles.

The primary challenge involves information accessibility. Locating specific contract details, tracking key dates, and monitoring obligations becomes nearly impossible without proper systems, leading to situations where an estimated 80 percent of procurement functions are not fully aware of competitive terms and contract structure. Manual management approaches quickly break down under volume and complexity.

Poor contract management transforms agreements from business enablers into operational hindrances, a problem highlighted by research showing that half of all contracts lack clauses for establishing governance bodies and escalation paths. Organizations without digitized contract systems face even greater challenges in tracking critical information.

Manual processes create significant risks. Important deadlines, intellectual property clauses, and compliance requirements become buried in paper files or scattered digital documents. Searching through physical contract storage can consume hours of valuable time for a single piece of information.

With digital contract management, you no longer have to waste time searching for contract details or tracking deadlines manually. Modern systems provide instant access to contract details, automated deadline tracking, and searchable repositories that transform contract management from a burden into a strategic advantage. It is no wonder that 80 percent of procurement teams use AI during contracting to get these results, according to The State of AI in Procurement 2025 Report.

Modern contract management software solves enterprise contract complexity by centralizing all contract activities in one platform. Effective solutions provide comprehensive functionality that addresses the unique challenges of enterprise contracting.

Essential software capabilities include automated workflow management, centralized contract storage, and real-time collaboration tools. These features turn contract management from a manual, error-prone process into a predictable part of your business operations.

Ironclad delivers comprehensive contract lifecycle management (CLM) designed specifically for enterprise needs. The platform provides complete transparency across every stage of contract development, execution, and management.

Sleek and powerful, Ironclad transforms contract lifecycle management from a stressful, time-consuming mess to a scalable, predictable process by storing and tracking relevant metadata on all of your contracts in a searchable centralized repository.

How Ironclad simplifies the enterprise contract creation process

Ironclad comes with many tools that simplify the enterprise contract management process. Here are some of them.

Ironclad Workflow Designer

Codeless and easy-to-use, Workflow Designer allows you to create a contract with just a few clicks.

Creating and approving enterprise contracts only takes two minutes in Workflow Designer. All you have to do is upload a template, tag fields as needed, and add approvers and signers to create the first draft of your enterprise contract

Workflow Designer also allows you to turn templates into automated workflows that anyone from your organization can access. This allows you to ensure that your contracts are consistent across departments, so everyone is aligned when working on certain deals or types of contracts, whether they’re from legal, marketing, HR, or another department.

While most other contract management software have steep learning curves, anyone can use Workflow Designer’s click-and-drag interface to add automated guardrails for review. This automation will help you and your colleagues save a lot of time, particularly for standardized, low-risk enterprise contracts that don’t require a great deal of redlining or negotiation. By using such tools, teams can reduce average contract cycle times from four weeks to just one week, according to The Legal AI Handbook.

Our Workflow Designer also allows you to:

• Cut down on training time by assigning active contract management roles to employees and departments with specialized knowledge
• Improve team responsiveness with instant updates

Ironclad Dynamic Repository

Ironclad’s Dynamic Repository is another codeless tool that helps you get more value from your contract metadata.

Our data repository gathers all of your contracts into one searchable hub. With everything in one place, you’ll be able to locate critical data about your deals and track the contract process metrics stakeholders care about. Say goodbye to unanswered questions and long afternoons spent looking for paper contracts in the storeroom—with Dynamic Repository’s advanced search functions, all you have to do is enter search terms to locate the information you’re looking for.

Dynamic Repository also allows you to create intelligent alerts, reports, and process automation that make things much easier for your legal team. For example, you can automate weekly emails about upcoming key dates, which will empower you and your team to work together to meet all deadlines and achieve the best outcome.

Transform your enterprise contracting process

Enterprise contracts are more than just legal documents; they are strategic assets that define your most important business relationships. Getting them right means understanding their unique complexity, creating them with care, and managing them proactively. As we’ve seen, this involves a lot more than just a signature.

If you’re tired of wrestling with manual processes, chasing down approvals, and digging through folders to find critical information, it might be time to rethink your approach. A modern contract management platform can turn a chaotic process into a smooth and predictable one, giving your team the tools to move faster and reduce risk. Ready to see how you can simplify your enterprise contract lifecycle? Request a demo today.

Frequently asked questions about enterprise contracts

What is the difference between an enterprise contract and an enterprise agreement?

While the terms are sometimes used interchangeably, they often have distinct meanings. An “enterprise contract” is a broad term for any high-value, complex contract between two businesses. An “enterprise agreement” (EA) typically refers to a specific type of volume licensing agreement for software, like those offered by Microsoft or Oracle, where a company commits to a certain level of usage over several years.

Who typically manages enterprise contracts in a large organization?

It’s usually a team effort. The legal team or a dedicated contract manager is responsible for drafting, reviewing, and ensuring compliance. However, they work closely with other departments. Procurement manages vendor and supplier contracts, sales operations handles customer-facing deals, and finance tracks the financial obligations. A good CLM system connects all these stakeholders in one place.

What are the biggest risks in enterprise contracts?

The risks are as complex as the contracts themselves. Common ones include unclear performance standards (SLAs) leading to disputes—a risk reflected in research showing that more than 75 percent of contracts lack exhaustive key performance indicators (KPIs)—weak limitation of liability clauses that expose the company to significant financial damage, and poor data security provisions that can lead to breaches. Another major risk is simply losing track of obligations and renewal dates, which can result in missed opportunities or unwanted auto-renewals.

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Ironclad is not a law firm, and this post does not constitute or contain legal advice. To evaluate the accuracy, sufficiency, or reliability of the ideas and guidance reflected here, or the applicability of these materials to your business, you should consult with a licensed attorney. Use of and access to any of the resources contained within Ironclad’s site do not create an attorney-client relationship between the user and Ironclad.