Why Spend Leakage Happens and How to Fix It

Spend Leakage

Across industries, one pattern keeps appearing:

8–9% of negotiated contract savings quietly evaporate after the contract is signed. 

It’s commonly referred to as ‘spend leakage’.  

This doesn’t happen because Procurement negotiated poorly—quite the opposite;

Most teams negotiate excellent agreements, secure competitive terms, and lock in strong unit-price, discount, and rebate structures.

Spend leakage happens after signatures.

Once a contract goes live, value begins to erode through everyday operational challenges:

  • Price drift across POs and invoices
  • Missed rebates and volume-based incentives
  • Incorrect or outdated pricing was used
  • Supplier billing discrepancies
  • Exceptions that never get resolved
  • Fragmented data across sourcing, contracting, AP, and vendor management

This is NOT a negotiation issue.

It’s an execution issue—and it’s costing your organization millions of dollars.

Why Spend Leakage Happens:

Procurement, Accounts Payable, and Supply Chain teams work incredibly hard, but they’re fighting systemic constraints:

  • Contract terms live in one system
  • Supplier files live somewhere else
  • AP exceptions live in email queues
  • Rebates live in spreadsheets that miss many of them
  • Pricing updates don’t flow cleanly across requisition, PO, receipt, and invoice processes

With this level of operational fragmentation, even the best Procurement organizations struggle to ensure contract terms are executed with precision.

This is where leakage happens

– not because people aren’t doing their jobs—they are getting most of it—

but because recovery requires so much manual effort, some of it goes unclaimed. 

As companies strive to unlock greater efficiencies, we can help them leverage their existing platforms to give time back to existing teams while clawing back contract leakage.   

A New Approach: AI-Driven 4-Way Match

Outcome Driven Solutions closes this execution gap—without forcing you to rip out your current tools.

AI-Driven 4-Way Match continuously compares:

  1. Contract Terms
  2. Purchase Orders
  3. Supplier Performance
  4. Invoices

…across your existing Source-to-Pay environment.

It allows us to identify, quantify, and recover leakage automatically:

  • Price variances
  • Unit-of-measure discrepancies
  • Missed or misapplied discounts
  • Unclaimed rebates and incentives
  • Contract non-compliance
  • Volume-based pricing tiers not reconciled

Most organizations recover enough to break even within 30 days—and that’s just the start.

AI-Driven can be added with

  • No disruption
  • No system replacement
  • No long implementation process

Just clean data, clear visibility, and cash you already earned.

Why Spend Leakage Matters Right Now!

CFOs, CPOs, and Finance leaders are under pressure to:

  • Expand EBITDA without cutting headcount
  • Prove Procurement’s contribution with tangible KPIs
  • Strengthen internal controls
  • Reduce leakage across decentralized purchasing
  • Improve supplier performance visibility
  • Accelerate AP productivity and exception resolution

AI-Driven 4-Way Match directly aligns to these objectives, offering a fast, low-friction lever with outsized financial return.

Your Spend Is Telling a Story—Let Us Show You What It Says

We’ll analyze your data and show you exactly where value is leaking and how much can be recovered.

If even a fraction of your spend is slipping through cracks, that’s real money—millions of dollars that should be fueling your budget, not someone else’s.

👉 Want to know your leakage estimate?  

In 2 minutes, we can estimate how much hidden cash your systems are probably hiding.   

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