The most expensive gaps in indirect spend are not mistakes. They are seams between two people who are each doing their job correctly.
Somebody in accounts payable opens an invoice and checks it against the contracted rate. It matches. Approved, coded, paid. That person did their job, and did it well.
Somebody at the site signs for what came off the truck. It came. Signed, filed, forgotten. That person did their job too.
And nobody — not one person in the building — compares the two documents.
That is it. That is the whole leak. No fraud, no laziness, no one asleep at the switch. Just a check that would have caught the problem, sitting quietly in the space between two job descriptions, where it belongs to nobody.
The freight version of this
Supply Chain Management Review ran a piece on September 15 making exactly this point about freight. The argument is that most freight audits ask one question — does this carrier invoice match the rate we negotiated? — and stop there. What they do not ask is whether the invoice matches the receiving record. Cross-reference the two and you start finding shortages, incorrect weights, and accessorial charges nobody agreed to. Skip it, and all of that clears and gets paid, because the rate on the invoice was correct.
It is a good piece and worth reading. But the reason it caught our eye is not freight. It is that we see the identical pattern in every indirect category we touch.
Why this is not a freight problem
Freight just happens to be where the seam is most visible, because the paperwork splits so cleanly: one document says what you were charged, another says what arrived, and they live in different systems owned by different teams.
But the same split runs through office supplies, janitorial and sanitation, uniforms and facility services, waste and recycling, MRO, small parcel and print. In every one of them, the buying decision happens in one place — a site manager, a department head, whoever ran out of something on a Tuesday — and the payment happens somewhere else entirely, usually weeks later, by someone who has no way to know what was actually needed or what actually showed up.
Both ends behave sensibly. The site orders what it needs. AP pays what is owed on paper. The gap between those two reasonable behaviors is where indirect spend quietly gets expensive.
Three seams worth checking
Here is where we most often find money that nobody was hiding.
Between what was billed and what was received. The freight version above, but it applies anywhere goods or services arrive on a schedule: quantity delivered versus quantity invoiced, service performed versus service billed, the pickup that did not happen but showed up on the statement anyway.
Between one location and another. This one surprises people. The same item, the same supplier, the same week — different prices at two of your own sites, because each site was set up on its own terms years ago and nobody has had reason to put the two price files side by side. It is not a supplier problem. It is that nobody owns the comparison.
Between a contract’s end date and the calendar. Agreements that renew automatically are only a problem if the renewal date lives in a filing cabinet nobody checks. When the notice window closes quietly, the terms roll forward — and the person who would have renegotiated never knew there was a decision to make.
Notice the shape. In all three, the missing thing is not effort or competence. It is a comparison that no single role is responsible for making.
“We already did a cost-cutting push”
This is usually the moment someone says it — and they are right to. Most organizations we talk to have already been through an initiative. One administrator described their own effort to us as “a Herculean effort,” and it was. Departments made real decisions, real things got cut, people gave up things they liked.
So it would be both rude and wrong to suggest nothing happened.
What survives a push like that is not the stuff nobody looked at. It is the stuff nobody had the category depth or the calendar room to chase all the way down. An internal team running a cost initiative on top of their actual jobs will hit the big, visible, single-decision items — headcount, travel, a software renewal. What they will not get to is a line-by-line reconciliation of every facility category across every location, because that is not a decision. It is a grind.
The gap is not a judgment about the team. It is a statement about what a team with day jobs can physically reach.
Where to start, and what “addressable” actually means
If you want to test this in your own organization, you do not need a project. You need one honest conversation and three questions:
- Does anyone here compare what we were billed against what we actually received?
- Does anyone compare what one location pays for an item against what another location pays for the same item?
- When an agreement renews on its own, who finds out — and when?
If the honest answer to any of them is “nobody, really,” you have located a seam. That is not a failure. It is a gap in the org chart, and gaps in the org chart are fixable in a way that character flaws are not.
One caution, because we would rather say it now than surprise you later: the spend you can actually act on is always smaller than the total that shows up in your AP file. Some of it is locked under agreements with real remaining term. Some of it touches vendors you have good reasons not to disturb. Some of it is not indirect at all once you look closely. Anyone who tells you the whole file is addressable is selling you a number, not a plan. We would rather scope it honestly, show you what is out and why, and work the part that is real.
The part that outlasts the savings
Here is the thing we have learned to say early. The dollars matter, obviously. But the durable outcome of this work usually is not a number. It is that somebody now owns the comparison.
When the reporting exists, when the renewal calendar is visible, when the price file across locations is one file instead of eleven, the seam closes. Not because someone is watching it harder, but because it stopped being nobody’s job.
Buyers ask us about this directly, and it is the right question to ask. One put it this way: “Do you continue on in perpetuity if we were to ask that? Or is that something you transition over to a procurement person that we would need to have in-house?” The honest answer is that the reporting is the deliverable. Savings you keep after an engagement ends are not savings we found. They are a check somebody now runs.
Nobody did anything wrong. That is exactly why it is worth looking.
ACC finds money in indirect spend nobody was looking at. If you would like a second set of eyes on the seams in your own organization, we are glad to talk.
