I am assuming you have a Microsoft account linked to the phone since a Windows phone is almost useless without that.
The contacts you see in the phone are maintained in that account in the cloud. So be aware that if you do "delete" the contacts in the phone you are also deleting them in the cloud and they won't be accessible on your Windows PC, tablet, other Windows phones, etc.if you have those.
That said, I don't recall on Windows phone 8 (which your phone came with or 8.1 which it might have been updated to) has a way to check all the contacts so they can be deleted at once, BUT if you want to delete them because you aren't going to use the phone, doing a hard reset returns the phone back to its initial state, so it will no longer...