Maverick Spend

What is Maverick Spend?

Maverick spending refers to purchases made outside an organization’s established procurement policies, such as buying off-contract or from unapproved suppliers. It can account for 25–80% of total spending across all businesses.

Maverick expenditure means employees buying things outside the company’s approved purchasing process or suppliers, which leads to unnecessary costs and reduced control.

Key Issues with Maverick Spend

Maverick expenditure causes two main problems:

• Loss of pre-negotiated contract savings
• Risk of contract breaches because of volume leakage

Therefore, maverick expenses fail to take advantage of pre-negotiated prices or volume reductions to save money.

The organization risks operational, supply, and reputational issues when purchasing from unlicensed or uncontracted vendors. It can hurt supplier relationships and source-to-pay processes.

Controlling Maverick Spend

1. Analyze Spend: Identify where off-contract purchases occur and assess their cost impact.
2. Educate Teams: Ensure employees understand the importance of centralized procurement and its effect on costs and operations.
3. Improve Processes: Implement smarter procurement systems, approval workflows, and easier purchasing procedures.
4. Plan for Exceptions: Establish an escalation process for urgent or special purchases outside existing contracts.