Manufacturers lose millions each year because agreements stay buried and inaccessible at the very moment when teams need clear information to act.
By Antonio Goncalves, Co-Founder and CEO of Vallor AI
In manufacturing, contracts govern everything, including pricing, delivery schedules, rebates, SLAs, IP protections, and upstream obligations that ripple deep into the supply chain. Yet for all their importance, contracts often remain some of the least visible assets inside an enterprise. They’re scattered across shared drives, buried in PDFs, or locked inside email chains that only a few subject-matter experts can navigate.
This lack of visibility carries a steep cost. It reduces deal velocity, obscures risks, and diminishes the value of negotiated terms. And as global supply chains grow more regulated and interconnected, the stakes for manufacturers have never been higher.
Recent findings from Vallor’s 2025 survey of 120 procurement and legal professionals underscore this growing urgency: 52% of organizations still lack clear centralized access to their contracts; 59% manage review and redlining manually; and nearly one-third admit to missing rebates or incentives because agreements were inaccessible or poorly tracked
Contract visibility has shifted from a “nice-to-have” to a foundational requirement for manufacturers striving to compete on cost, speed, and compliance.
The impact of poor visibility is not abstract. It is measured in real dollars and operational drag. External benchmarks show poor contracting practices can erode 8–9% of annual revenue, with global losses reaching nearly $2 trillion each year. Much of this loss stems from missed discounts, unclaimed rebates, outdated terms, or lapses in supplier obligations—all because the agreements sit out of sight. Manufacturers negotiate aggressively on cost and delivery. Yet many never fully realize that value because the contract itself is inaccessible when teams need it most.
More than half of survey respondents say it takes 30 minutes to two hours to locate and validate a single clause when reviewing a supplier contract or supporting a negotiation. Multiply that by thousands of contracts across categories—metals, chemicals, spare parts, packaging, logistics, energy—and the delays compound quickly. This slow search-and-verify motion is particularly painful during tight production windows or when onboarding new suppliers to address shortages.
The regulatory landscape for manufacturers is intensifying. In 2024, the Federal Register published a record number of pages, reflecting rapid expansion in areas like: 1) data privacy, 2) cybersecurity obligations, 3) carbon reporting and ESG disclosures, 4) trade restrictions, and 5) product safety and traceability.
When obligations are buried inside static PDFs or fragmented storage systems, compliance becomes a guessing game. Manufacturers face heightened risk not because they lack the intent to comply, but because they lack visibility into what they are required to do.
As I often remind teams: You can’t enforce what you can’t see.
Manufacturers face a unique combination of challenges:
The result is a visibility gap that widens every year, and the operational cost is now too high to ignore.
AI adoption in contract management is accelerating rapidly. Approximately 20% of organizations report extensive AI use, 34% are piloting, and another 33% are actively exploring AI approaches to improve visibility and automation. The shift is not about dashboards or contract metadata. It’s about agentic systems and AI that actually works on behalf of procurement teams.
New AI capabilities are giving manufacturers a way to work with contracts as dynamic, searchable assets rather than static documents. Advanced systems can now extract every clause, obligation, renewal date, and KPI from existing agreements, making information accessible across thousands of documents in seconds. This visibility lays the groundwork for something even more valuable: continuous oversight.
With obligations monitored in real time, teams can see immediately whether rebate thresholds are being met, whether suppliers are adhering to service levels, or whether pricing terms need adjustment. Instead of waiting for quarterly reviews or end-of-year audits, procurement and operations gain a live picture of contract performance.
This same intelligence helps organizations spot risks long before they escalate. AI can surface issues tied to data privacy, environmental reporting, regulatory changes, or any clause that might create exposure if overlooked. Early warnings give leaders room to respond, course-correct, or engage suppliers before a small oversight becomes a costly problem.
And oversight is only part of the shift. AI is also beginning to enforce terms automatically, flagging discrepancies, notifying stakeholders, and routing updates directly into internal systems without manual intervention. Contract management is moving from passive storage to active execution, where agreements are continuously monitored and acted upon.
The manufacturers who gain the biggest advantage will not be the ones with the most dashboards but the ones whose contracts are truly operationalized, always visible, always current, and always in motion.
Manufacturers don’t need a full system overhaul to begin closing the visibility gap. They can start with a few practical steps:
Visibility streamlines procurement, and strengthens the entire manufacturing ecosystem.
Contracts are the operating system of procurement, yet most manufacturers still treat them like static documents. But the industry is changing. As automation and AI reshape production lines, the same transformation is coming for commercial operations.
The visibility gap is a legacy of old processes, not a permanent condition; manufacturers can overcome it. And the manufacturers who close it first will outperform peers on cost, compliance, resilience, and supplier performance. The future of contract management is one where agreements don’t sit in drawers. They work alongside your teams, powering better decisions every day.
About the Author:
Antonio Goncalves is a Brazilian-born founder and CEO of Vallor with a background in strategic sourcing at Microsoft, where he led multi-million-dollar negotiations. Antonio founded Vallor to help businesses unlock greater value from their contracts using advanced AI agents. He holds a Mechanical Engineering degree with a Computer Science minor from Georgia Tech.
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