SaaS contract management: What it is, challenges, tools, and best practices
The SaaSification of everything has made work easier for organizations by delivering the systems and applications they need as services.
But at the same time, having an extensive SaaS sprawl (across multiple teams) makes management a nightmare.
If your organization doesn’t provide management mechanisms to make sure all contracts are renewed, canceled, or updated on time, this could lead to service disruptions and revenue loss.
In this article, I’ll explain the challenges, impacts, and benefits of SaaS contract management in the modern workplace.
Key takeaways
SaaS contract management means tracking, renewing, updating, and optimizing every agreement with SaaS vendors.
Done well, it reduces cost, prevents service gaps, improves compliance, and provides financial clarity.
The right tools centralize contracts, automate renewal workflows, and keep your company compliant.
What is SaaS contract management?
SaaS (software-as-a-service) contract management is the process of monitoring, tracking, renewing, updating, terminating, and suspending all agreements related to the use of a SaaS application.
When you add a SaaS application to your stack, you have to sign a binding contract with the vendor. This could be:

• Limitation of liability
• Service-level agreements (SLAs) 
• Intellectual property rights
• Pricing and billing schedules
• Termination or renewal terms
• Non-disclosure or confidentiality agreement

For proprietary software, the package could contain all the mentioned SaaS agreements and more.
So how do you keep track of the contract terms, scope, milestones, usage rules, expiration, and renewal dates?
That’s where a contract management solution comes in. It involves the use of an application to automate every phase of the contract lifecycle. It also centralizes all SaaS contracts into one repository for easy access by all stakeholders.
Who needs SaaS contract management? 
Here are the common use cases for SaaS contract management:

• Organizations can unify their SaaS sprawl as well as encourage transparency and accessibility with SaaS agreement management.
• Managers can use contract management to plan operations around contract negotiations, cancellations, and renegotiations. IT service providers can automate and manage the SaaS contracts of multiple clients from one dashboard.
• Businesses can use automated contract management solutions to keep services running through auto-renewals and recurring payments.
• Compliance teams can monitor risks and contractual obligations to keep them in line with industry regulatory standards.
• Business analysts and finance teams can track and optimize expenses through existing and expired licenses. 
• C-suite execs will get a quick overview of ROI and other critical business metrics from a unified dashboard. 

Depending on your organization’s needs, you can enter a SaaS contract based on different pricing models. Subscriptions are usually based on the number of users, features, or a flat rate. So, when signing a contract, choose the pricing model that works for you.
SaaS contract lifecycle stages
Most SaaS agreements move through repeatable phases. Managing each intentionally prevents unnecessary spend and risk.
Request or intake
A team identifies a need for a new tool and submits a request.
Vendor evaluation and due diligence
Teams assess pricing, security, compliance, and functionality.
Negotiation and approval
Terms may shift based on risk reviews, vendor lock-in limits, or budget constraints.
Signature and onboarding
Stakeholders sign — often using eSignature — and the tool is deployed.
Usage management
Finance and IT monitor adoption, license count, implementation, and value.
Renewal or termination
The business decides whether to continue, renegotiate, or cancel.
For a deeper dive into digital signing and requirements, see our guide on qualified electronic signatures: https://www.pandadoc.com/blog/qualified-electronic-signature/)
Why is SaaS contract management important?
Now that you understand who needs SaaS contract management software, let’s shift our focus to the tangible benefits of properly implementing it in your business processes.
Improve efficiency
Properly managing SaaS contracts will help your organization reduce the time spent on redundant, time-consuming admin tasks such as contract review, searching, updating, and signing.
Authorized users can rely on this system to create contracts using customizable templates. They can also renew or terminate running end-user license agreements (EULAs) as well as get the right signatories to sign vital business or sales documents on time.
Keep services running
The contract management process involves the use of automation to streamline redundant tasks in workflows while keeping the business on regularly scheduled programming.
For example, an eCommerce website can rely on auto-renewals to ensure its continued operation after the hosting subscription reaches its end-of-term.
This means customers will have access to products or services without disruptions while your company decides how to settle the bills.
Improve visibility
Done right, managing contracts with different SaaS providers gives authorized stakeholders access to vital business data. 
This usually comes in the form of centralized dashboards where they can track all actions on the contract. Consequently, this increased visibility breaks down information silos in organizations.
Automate agreements
Using an automated contract management platform gives you access to boilerplate contract clauses, instant renewal notifications, and event triggers for any changes during negotiation.
This means you no longer need to manually check when the contract is due or when a client has made edits to an agreement.
Automation also includes chatbots, which make self-service possible. You can embed AI assistants to help users generate clauses and complete contracts within seconds.
Contract intelligence is also a product of automation. It allows you to analyze the contents and metadata of all contract fields to determine how best to draft and structure contracts.
Stay scalable
When you streamline contract administration for SaaS applications, your organization can scale operations to meet current demands.
For example, you can add more SaaS platforms to your tech stack since you now have a mechanism for keeping them all compliant and operational.
Save money
Managing SaaS contracts with a solid plan will help your business reduce expenses. For starters, you get a better view of all the applications that are not in use, but you are still paying for.
This brings us to the issue of auto-renewals. To guarantee continuous service availability, companies sign up for automatic contract renewals. This means you might be paying for services your team no longer needs.
However, a SaaS contract management system will notify you about upcoming renewals, price changes, and available discounts. This will help you tailor your expenses to current business needs.
Integrate with third-party systems
A contract management platform allows users to embed third-party integrations. For example, you can integrate your Salesforce CRM to monitor all accounts. Another option is to embed an electronic signature solution across your organization.
Generate valuable insights
Consolidating all your SaaS contracts centralizes data from all your apps and systems, which you can synthesize for detailed, valuable business insights.
As mentioned earlier, you can integrate contract data management solutions and analytical tools to gather valuable insights such as missed renewals, churn rate, cancellation rate, pending deals, closed deals, and other vital metrics.
Stay compliant and secure
One key aspect of owning a SaaS contract is complying with general data handling, residency, storage, and other industry-specific regulations. Most SaaS solutions handle compliance individually, making it difficult to monitor changes to standards.
However, a SaaS contract management solution can help you properly track compliance to meet regulatory requirements, internal policies, and industry standards. This will protect your business from unauthorized access, data breaches, fines, service disruptions, and other risk factors. After all, 85% of companies only want to work with companies that prioritize compliance.
The challenges of managing SaaS contracts
Managing one contract is simple. Managing dozens across departments? Not so much.
Here are the primary challenges — now with clear subheads.
1. Multiple pricing models and renewal terms
Vendors may bill monthly, annually, per seat, or per usage — making forecasting tricky.
2. Renewal chaos and auto-renewal traps
Tracking term dates manually leads to surprise charges or unplanned spend.
3. Compliance complexity
GDPR, CCPA, HIPAA, PCI — requirements vary by vendor and industry.
4. Limited visibility across departments
Teams adopt tools independently, creating fragmented ownership and shadow IT.
5. Poor integration between systems
Apps that don’t talk to each other complicate reporting, billing, and access control.
6. Choosing the right platform
Not all contract management systems support SaaS-specific needs like seat tracking or usage insights.
Manual vs automated SaaS contract management

Essential features to look for in SaaS contract management software
Centralized contract repository
Store every agreement in one searchable location.
Electronic signatures
Route approvals and capture signatures securely and quickly.
Document automation
Build templates once and reuse — minimizing manual drafting.
Approval workflows
Ensure legal, IT, and finance sign off before spend occurs.
Renewal alerts and lifecycle triggers
Never miss an expiration or price change again.
Analytics and contract intelligence
Surface usage signals, savings opportunities, and vendor trends.
Integrations
Connect to Salesforce, HubSpot, Stripe, and more to keep data consistent.
Best practices for effective SaaS contract management
Centralize contract storage
One source of truth prevents duplicates and confusion.
Set renewal alerts and reminders
Ideally, 30/60/90 days before term end.
Implement approval workflows
Avoid rogue spending and shadow IT adoption.
Vet vendors carefully
Validate security, privacy, and support before signing.
Watch for vendor lock-in
Favor flexible terms for noncritical tools.
Conduct regular contract audits
Cancel what’s unused, consolidate where possible.
Monitor SaaS performance
Track adoption and ROI — not just spend.
Integrate your CRM, ERP, and finance systems
Data should flow both ways to inform budgeting and forecasting.
Common SaaS contract management mistakes to avoid

• Allowing tools to auto-renew without review
• Letting every team purchase independently
• Choosing long-term commitments without a usage plan
• Skipping due diligence on data handling and compliance
• Treating contract storage as filing instead of insight
• Not aligning SaaS spend to business goals

How PandaDoc helps you manage SaaS contracts
PandaDoc brings contract visibility, standardization, and automation into one intuitive platform.
With PandaDoc, you can:

• Store all SaaS vendor agreements in one secure place
• Generate contracts using customizable templates
• Manage signatures and approvals from any device
• Integrate CRMs, ERPs, and payment systems
• Automate renewals and notifications across your tool stack
• Analyze agreement data to uncover risks and opportunities

Ready to eliminate wasted spend and regain control of your SaaS ecosystem? Start using PandaDoc for your SaaS contracts, book a quick demo right away.

Disclaimer

PandaDoc is not a law firm, or a substitute for an attorney or law firm. This page is not intended to and does not provide legal advice. Should you have legal questions on the validity of e-signatures or digital signatures and the enforceability thereof, please consult with an attorney or law firm. Use of PandaDoc services are governed by our Terms of Use and Privacy Policy.