Difference between Sales and Service Contract

Hi,

As per the IFS documentation, 

sales contract: 

“Managing contracts and the financial control of the contracts is critical to contract-intensive businesses. The ability to manage contracts with revision control and manage revenue using progress billing is typical.

It is vital that the process of responding to and creating tenders of work is recorded for future reference. It is used as the basis for monitoring the negotiation progress, as well as for tracking the conversion of the tender to contract. Contracts need to be cost controlled, have progression of the work recorded, and allow revisions of contract baselines while managing applications for payment and cash collection activities.

The contractor will receive tenders from prospective customers and will have to create bids or quotes within the constraints of the tender, and also manage the cash collection.

The Contract Management feature includes the following key capabilities:

• A contract can be developed with or without creating a project. Once a contract is won, a project will have to be used to create applications for payment.
• A contract can have one or more projects attached to it.
• Comprehensive contract revision control with baselines and audit trailing.
• Control changes in contract by reference to contract change orders (variation orders).
• Complete support throughout the contract lifecycle. The contract acts as a tender and becomes a contract if won.
• Possible to use the same contract to bid to many prospects.
• Possible to handle customers who have been blocked for credit.
• Default values will be held at contract level (e.g. retentions, markups, payment terms, currency exchange rates, etc.)
• Optional control dates can be held (e.g. follow up dates, certification dates, etc.)
• Percentage deductions will be held on the contract.
• Complete contract scope including all the deliverables is held.
• Possible to manage lines/items without the need for part numbers.
• Multi currencies within a contract are supported.
• Selling values can be held (quantities and cost values are optional).

The contract normally goes through the following stages”

And service contract:

“A service contract serves as an agreement between the customer and the service provider. Hence, a service contract is defined per customer and is valid for multiple sites. Optionally, you can group the service contracts using a contract type, e.g., WARRANTY and SERVICE.

Although the service contract is defined per customer you have the option of connecting additional customers. This serves two purposes:

• Allows many customers to use one service contract, e.g., if different maintenance organizations within a company are defined as separate customers but are still allowed to use the same service contract, they can be included as additional customers.
• Allows you to enter a different payer, e.g., if one of the aforementioned maintenance organizations have to be invoiced instead of the parent company, the maintenance organization can be entered as the alternative customer but to do so the maintenance organization has to be connected as an additional customer.”

Thanks!

I have already read the documentation but it does not clearly states when to use Service Contract and when to use Sales Contract and when to use Sub Contract.