ProcureLabs
Value Leakage Analysis
Savings Recovery Report
Identifying hidden costs, payment errors, and compliance gaps
Total Value Leakage Identified
$6.72M
4.0% of addressable spend
Recoverable through targeted interventions and process improvements
$5.1M
Recoverable (12 mo)
Maverick Spend
Purchases outside contracted suppliers
$2.52M
Contract Leakage
Paying above contracted rates
$1.85M
Demand Inflation
Over-specification & unnecessary purchases
$1.46M
Duplicate Payments
Invoices paid more than once
$890K
Root Causes Identified
- Decentralized purchasing without policy enforcement
- Manual contract management with no price validation
- Multiple ERP systems without invoice matching
- Lack of demand planning and specification standards
Quick Recovery Opportunities
- Duplicate payment recovery: $890K immediate
- Contract price correction: $620K in 30 days
- Rebate/credit reconciliation: $340K pending
- Total quick wins: $1.85M in 90 days
Purchases made outside contracted suppliers or approved procurement channels, resulting in higher prices,
missed volume discounts, and increased supplier risk. Analysis identified 423 transactions across 89 suppliers
where preferred alternatives existed.
Top Instances Identified
Office supplies from non-preferred vendors (Office Depot, Staples off-contract)
$340K
IT equipment from unapproved resellers (CDW, Insight off-contract)
$580K
Marketing services without competitive bids
$420K
Temporary staffing outside MSP agreement
$680K
Facilities maintenance with local providers vs. national contract
$500K
Paying rates higher than contractually agreed, missing rebates and discounts, or failing to enforce
pricing terms. Analysis compared 12,400 invoice line items against contract terms and identified
systematic price discrepancies.
Top Instances Identified
Missed volume rebates on logistics contracts (FedEx, UPS)
$420K
Catalog pricing errors vs. contracted rates (IT hardware)
$280K
Early payment discounts not captured (2/10 net 30 terms)
$310K
Unclaimed supplier credits and rebates
$340K
Rate escalations applied incorrectly (consulting contracts)
$500K
Over-specification of requirements, unnecessary purchases, or premium options where standard would suffice.
Includes unused licenses, expedited shipping when not required, and gold-plating of technical specifications.
Top Instances Identified
Premium/expedited shipping when standard would suffice
$280K
Over-specified technical requirements (IT projects)
$440K
Unused software licenses (Salesforce, Adobe, Microsoft)
$320K
Duplicate tool subscriptions across departments
$220K
Over-ordering with subsequent waste/obsolescence
$200K
Invoices paid more than once, payments to wrong vendor accounts, or credit memos not properly applied.
Identified through invoice number analysis, payment pattern detection, and vendor statement reconciliation.
Top Instances Identified
Duplicate invoice submissions (same invoice different dates)
$520K
Payments to inactive/merged vendor accounts
$180K
Credit memos not applied against open invoices
$190K
Duplicate payment recovery
$890K
Rebate/credit reconciliation
$340K
Contract price corrections
$280K
Early payment discount capture
$310K
Unused license cancellation
$280K
Maverick spend redirection
$1.4M
Contract compliance enforcement
$620K
Demand management standards
$480K
Shipping mode optimization
$300K
Remaining maverick spend
$640K
Demand inflation reduction
$480K
Ongoing duplicate prevention
$200K
Contract optimization
$500K
Total Recoverable Value
$6.72M
100% recovery achievable within 12 months through systematic execution
Engage recovery audit firm to pursue duplicate payment refunds from suppliers. Implement automated
invoice matching to prevent future duplicates. Reconcile all vendor statements from past 24 months.
Deploy guided buying platform with preferred supplier catalogs. Implement approval workflows for
off-catalog purchases. Redirect maverick spend to contracted suppliers with negotiated pricing.
Implement automated price validation against contract terms for all invoices. Set up alerts for
pricing discrepancies and unauthorized rate changes. Establish rebate tracking and collection process.
Establish specification standards to prevent over-engineering. Implement software license management
with usage tracking. Create shipping mode guidelines with cost-based routing.
Policy & Governance
- Procurement policy refresh with clear approval thresholds
- Mandatory use of preferred suppliers for all categories
- Competitive bid requirements for purchases over $25K
- Annual policy training for all budget holders
Technology Controls
- Guided buying with preferred supplier routing
- Automated 3-way invoice matching
- Contract price validation at invoice entry
- Duplicate payment detection algorithms
Process Improvements
- Centralized contract repository with renewal alerts
- Monthly rebate tracking and collection process
- Quarterly software license utilization review
- Shipping mode guidelines with exceptions tracking
Monitoring & Reporting
- Weekly maverick spend dashboard
- Monthly contract compliance scorecard
- Quarterly leakage analysis refresh
- Annual comprehensive spend audit
Detailed Leakage by Business Unit
| Business Unit |
Total Spend |
Maverick |
Contract |
Duplicate |
Demand |
Total Leakage |
| Operations |
$62.4M |
$840K |
$620K |
$380K |
$420K |
$2.26M |
| IT |
$28.6M |
$580K |
$480K |
$210K |
$540K |
$1.81M |
| Sales & Marketing |
$24.2M |
$420K |
$340K |
$120K |
$280K |
$1.16M |
| R&D |
$18.8M |
$380K |
$210K |
$80K |
$140K |
$810K |
| Corporate |
$34.0M |
$300K |
$200K |
$100K |
$80K |
$680K |
Methodology
This value leakage analysis was conducted using:
- Data Sources: 24 months of AP transactions, purchase orders, contracts, and supplier master data
- Maverick Spend: Matched transactions against preferred supplier agreements and catalogs
- Contract Leakage: Compared invoice unit prices against contracted rates for top 200 SKUs
- Duplicates: Invoice number matching, payment pattern analysis, vendor statement reconciliation
- Demand Inflation: Specification analysis, license utilization data, shipping mode comparison
All leakage values are conservatively estimated. Actual recoveries may vary based on supplier cooperation
and internal process changes. Recovery timelines assume dedicated project resources.