What is Contract Generation? Complete Guide in 2025

Do you want to:

• Generate contracts that are customized and compliant with relevant security standards and legal regulations?
• Employ user-friendly automated solutions that seamlessly integrate with your current IT setup and that anyone in your organization can use without previous coding experience?
• Speed up the contract creation process and minimize errors at the same time?

Contract generation tools like Docupilot use powerful automation tools to save 80% of time spent on contract creation and minimize the risk of inaccuracies, ambiguity, and by extension, costly disputes.

In this article, we’ll show you how you can integrate contract generation and automation, the benefits of automating contract generation, and the features you must look for when selecting a contract generation tool.

What is Contract Generation?

Contract generation is a multi-stage process for legal contract creation. It starts with a contract request and proceeds to data collection, contract creation and formatting, and finally review and approval. 

Creating contracts manually is a tedious and time-consuming process. Contract automation streamlines the process and offers numerous benefits for legal firms, real estate agencies, and businesses involved in high-volume contract generation. 

What is the Automated Contract Generation Process?

The contract generation process includes the following steps.

#1 Creating custom templates 

The first step in the process is creating templates for the different types of contracts your organization uses. 

For example, to create a template for a real estate purchase agreement in Docupilot, you would click on “Create a new Template” button on your Dashboard. You have the option of uploading an existing template or building online. If you decide to build online, an editor will open up where you can add the relevant contract sections with the necessary clauses and save the template. 

Contract automation tools like Docupilot support features that allow you to create highly customized templates.

You can include dynamic content using variables, conditionals, and tables. For example, with Docupilot you can set up the template so that the final contract will include certain clauses only if specific conditions are satisfied. To further save time, you can include clauses that are pre-approved by legal. This will protect you from the contract to and fro with legal, which is typical of manual contract generation. You can also add custom formatting and branding elements to the templates.

Template creation is the most time-consuming part of the process. But when done right, it will help you save on time and effort later on. 

#2 Populating templates with data

The next step is populating them with data from different sources.

Without automation, legal team would carry out the grunt work of entering data into many respective fields, exploiting the keyword keyword shortcut combination for finding fields and replacing them with text customer information; a time-consuming and error-prone process.

Modern contract generation tools like Docupilot allow you to pull data from multiple sources, such as Airtable databases and Google Forms. Once you connect your contract generation platform to the data sources, the software will auto populate templates with data at the click of a button. 

#3 Generating the contract

With manual document processing tools, you have to open up a template, enter data manually, add and remove clauses, and check and re-check the document multiple times.

With contract automation, once your templates are ready and your contract automation platform is connected to the data sources, you only have to select the right template and click a button. 

And voila! Your contract is ready for review!

#4 Submitting for review and approval

Yes, you still have to get the contract reviewed for accuracy and compliance. And this is part of the contract generation is something automation can’t take away!

However, automation can speed up the review process. For example, you can integrate with email delivery tools and set up workflows to ensure the contract is sent to the reviewer and is approved or is set up for negotiation without any unnecessary delays. 

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#5 Storing the contract

Approximately 71% of organizations lose track of 10% or more of their contracts. After spending all the time and effort to create the contract and get it approved, you surely don’t want to lose track of it, right?

So how can you ensure approved contracts are not lost? Again, your trusted contract automation platform can help you out. Docupilot, for example, integrates with online storage solutions such as Box and Google Drive. Once you have designated storage for your contracts, you don't have to worry about finding them later. 

#6 Automating signing

The final step in the contract automation process is automating and integrating with your existing workflows. For example, if you prefer to use Docusign for secure electronic signatures, you can integrate Docupilot with Docusign and send the approved contracts for signing. 

Once the contract is signed, you can upload it to Dropbox for secure storage. 

And finally, you can deliver the completed contract to your clients via email. 

You can do all that from Docupilot or another contract automation platform.

Most contract automation software supports third-party app integrations. But many of them charge extra. With Docupilot, you don’t have to worry about paying for add-ons in addition to the base fee. When you pay the low monthly fee, you get all the features and can enjoy the benefits of all supported integrations. Sign up for a demo today!

What are the Benefits of Using Contract Generation Software?

Automating contract generation with software provides the following benefits for your business.

Create more contracts, spending lesser time and money

Manual contract creation is a haphazard and chaotic process: you open up a template, enter data (maybe make a few mistakes), make edits and amendments (miss a few clauses or add a few extra), go back and forth with legal, and then run around for approvals before you can submit.

And this is for just one contract. Imagine creating and sending hundreds of contracts: more errors and corrections, multiple rounds of review and approval.

Now compare that to automated contract generation: select the right template, click a button, and the contract is ready for review! 

Sure, you have to spend time creating custom templates and connecting to data sources. However, those are one-time activities and you don’t need to go through them for each new contract you generate.

When you add integrations with Zapier or other third-party tools, you can automate not only contract generation but your entire workflow for electronic signatures, storage, and client delivery. 

With specialist automation software, when you save time, you also save money: you need fewer resources to create and manage contracts, and you can move freed-up resources to higher-value activities like strategic negotiations and relationship building.

Improve your deal closing times

You spend significant time generating leads, meeting prospective clients, and negotiating. Once things are finalized, you can move toward the written contract. 

The contract process consumes approximately 20% of the selling cycle. And you can save 50% of that time by automating the process. 

Therefore, with contract automation, you can shorten deal closing times, and close more deals every year. 

Furthermore, automation reduces the administrative burden, and you can better allocate resources to make sure more time and effort are devoted to closing deals faster.

Reduce the risk of violating compliance and paying penalties

Contract disputes can become a major damper for your business’ growth and reputation and can have far-reaching consequences:

• Approximately 9% of contracts end up in a claim or dispute
• Disputes can lead to breaches of trust with clients and partners
• In addition, disputes can tarnish a business's reputation, and adversely affect growth.

There are several reasons for contract disputes, including inaccuracies and mistakes in the contract document. 

With contract automation, you can ensure accuracy, legal compliance, and consistency, reducing the risk of contract disputes and contributing to successful contracts and business growth.

Key Features of Contract Generation Software in 2025

There are the most important contract generation software features that you must look for.

Custom Templates

Templates are the engine of your contract automation efforts. Get them right, and your contracts will be accurate, compliant, and consistent. 

Static text will make up most of your contract content. In addition, you will need to format the text, add custom graphics, and other branding elements. 

Working with different file formats, such as Word Documents or PDFs, should not be an issue. And you want to be able to organize templates by type or customer.

Your contract automation platform must be able to support these features. You don’t want to get locked into a solution that restricts the customization you can apply to your templates.

Conditional Logic

Each contract you create will vary depending on the client, the type of contract, the specifics of the deal, etc.

With conditional logic, you can build smart, dynamic contracts where the content adapts based on your inputs. You can use it to display or hide certain fields and dynamically format content in your contracts. 

For example, if you are working on a real estate contract, you can define conditions to control the insertion or removal of certain clauses. You can also use this feature to add other types of dynamic content such as maps, QR codes, and tables. 

Integrations

Third-party app integrations allow contract automation software to connect with a wide range of tools and platforms you already use, such as CRM systems, cloud storage, e-signature services, and project management tools.

Integrations enable a smooth and efficient workflow, as data transfers easily and synchronizes across different applications. You save time by eliminating the need for manual data entry, reduce the risk of errors, and enhance overall productivity.

Collaboration

Collaboration capabilities allow multiple stakeholders to simultaneously work on contract documents. This feature ensures seamless communication and eliminates bottlenecks associated with traditional, sequential review processes.

The collaborative approach accelerates the contract drafting and approval process and enhances accuracy and compliance by incorporating diverse perspectives and expertise.

Version Control

Version control tracks every change made to a document, and you can use it to view, compare, and revert to previous versions effortlessly. 

This feature helps ensure all stakeholders work with the most up-to-date information, reducing the risk of errors and miscommunication. 

Audit Trails

Audit trails provide a detailed record of every action taken on a contract, including edits, approvals, comments, timestamps, and user information. 

Audit trails enhance transparency and accountability. With this feature, you can track the history and progression of a document, which aids in compliance with regulatory requirements and simplifies the process of resolving disputes or misunderstandings. 

Conclusion

Manual contract management is a complex and daunting process: it takes too much time, too many resources are needed. Despite all this, contracts often have errors and inconsistencies, and negotiations cause a lot of back and forth. To top all that, it takes forever to obtain necessary approvals. Once contracts are ready, with manual storage and retrieval processes, it’s easy to lose track. And once a contract is lost, there is no option other than going through the rigamarole again.

User-friendly contract automation with Docupilot can help you contain the chaos: build a template, connect to data, press a button, and let the software work its magic.

Try out the features for yourself to see the power of contract automation. 

Sign up today for a no-questions-asked 30-day trial!

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FAQs

Here are frequently asked questions about contract generation.

How does contract generation system improve user experience?

Contract generation system improves user experience by making the contract creation process faster, more accurate, and more collaborative. Automation capabilities and seamless integration with other tools ensure users can efficiently create and manage contracts, leading to greater productivity and satisfaction

How do contract generation tools ensure data security?

Contract generation tools protect sensitive contract data through robust security features, such as encryption, access controls, and audit trails.