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In this tutorial, Matthew explains how to create a plumbing contract using Legal Templates. Viewers are instructed to click on a provided link to access the website, then navigate to "Business Forms" and use the search function to find "Plumbing contract." After selecting the contract, users set the transaction type as a service and fill in their personal details as the service provider, along with the customer's information. The tutorial emphasizes describing the services rendered and pricing per project, ensuring to indicate the specific amount clearly, especially if multiple projects are involved.