There are several types of value that can be derived from a contract, including:
1. Economic value
Economic Value: the tangible financial benefits that are gained or lost as a result of entering into the contract. This can include things like the cost savings that come from purchasing goods or services at a discounted rate, or the revenue that is generated from selling goods or services at a profit.
2. Legal value
the protection and rights that are conferred upon the parties to the contract by its terms and conditions. This can include things like the ability to enforce the terms of the contract in court, or the right to seek damages for breach of contract.
3. Strategic value
the potential advantages that can be gained by entering into the contract in terms of achieving business goals or gaining a competitive edge. This can include things like gaining access to new markets or technologies, or establishing partnerships with other companies.
4. Relationship value
the intangible benefits that come from building and maintaining strong relationships with the other parties to the contract. This can include things like trust, goodwill, and collaboration.
Consider all of these different types of value
The specific types of value that are derived from a contract will depend on the specific terms of the contract and the circumstances of the parties involved. It's important for the parties to the contract to carefully consider all of these different types of value when negotiating and entering into the contract.
Using a professional Contract Lifecycle Management tool will help you to report on all different values.
written by
David Limaheluw
Mochadocs Customer Success
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