Research · The stat bank

How big is the leak, really? Every credible number we could find

TraceIT Research · July 2026 · 7 min read

Ask five research houses how much indirect spend leaks, and you'll get five different numbers, because they measure five different things. That's not a weakness in the evidence; it's the shape of the problem. Leakage hides in contracts, in store rooms, in unmanaged categories, and in emergency purchases, and each firm measures a different hiding place. Here is every credible, published number we could find, what it measures, and where it comes from. Every figure links to its source.

Leakage between contract and delivery

17–40%
value leakage between the value promised at contract signing and the value actually realized, driven by overpayment, unclear accountabilities, no holistic view of supplier performance, and unchecked consumption.
KPMG, "Disrupting the contract management paradigm" (2021)

World Commerce & Contracting's cross-industry research puts the average at 11% of contract value lost after signature, and warns the true figure is likely higher, because most organizations don't formally track value leakage at all.2 Read that twice: the leak is measured only at companies disciplined enough to measure it.

The unmanaged third

66.5%
of indirect spend is actively managed at typical organizations, versus 95% at world-class ones. At an average company, roughly one in three indirect dollars is unwatched.
The Hackett Group procurement benchmarks

Hackett's 2025 Digital World Class research shows what closing that gap is worth: top-performing procurement teams generate 2.03× greater savings as a percentage of spend, and their control of maverick buying and contract noncompliance results in 60% less savings lost.4 Industry analyses consistently estimate that 20–30% of indirect spend bypasses procurement controls entirely.5

What visibility recovers

McKinsey's numbers measure the fix rather than the leak: full indirect procurement transformations deliver ~15% initial cost reduction, industrial companies cut indirect costs 15–20% within 12–18 months, and retail programs take 10–15% off annual indirect spend.6 These are the figures behind the estimate on our homepage and in our calculator, deliberately the conservative end of the evidence.

The store room, specifically

50–60%
of MRO (spare parts) inventory at typical operations is inactive, slow-moving stock at 20–25%, obsolete items around 15%, with excess active stock adding another 10–20%.
MRO inventory analysis, Reliable Plant

Maintenance-industry research adds the operational cost of flying blind: MRO inventory consumes 40–50% of the total maintenance budget while 15–25% of it sits obsolete or surplus; emergency procurement of a missing part carries a 3–5× cost premium; and roughly 23% of unplanned downtime traces to unavailable spare parts.7 This is the layer where our own anchor customer found $1.8M, through overstocking visibility alone.

The honest summary

The ranges differ because the yardsticks differ. But put every credible measurement side by side and one conclusion survives: wherever indirect spend goes unwatched, contracts, categories, or shelves, the unwatched fraction is double-digit. The cure named by every source above is the same word: visibility. Granular, item-level, tamper-proof records of what was bought, where it went, who took it, and why. That's not our claim; it's the one thing McKinsey, KPMG, Hackett, and the maintenance engineers agree on. It also happens to be the only thing TraceIT does.

Sources

  1. KPMG International, "Disrupting the contract management paradigm" (2021). 17–40% value leakage, hard + soft
  2. World Commerce & Contracting, "Closing the Procurement Value Gap". 11% average contract value leakage
  3. The Hackett Group benchmarks via ISM, indirect spend under management: 95% world-class vs 66.5% typical
  4. The Hackett Group, 2025 Digital World Class® Procurement research. 2.03× savings, 60% less savings lost
  5. Industry analyses of maverick spend, e.g. Procurement VMS indirect spend guide. 20–30% bypasses controls
  6. McKinsey & Company, industrial indirect costs, indirect procurement transformation, retail indirect spending
  7. Reliable Plant, "Show me the money: an MRO inventory analysis"; maintenance-industry data on MRO budgets, obsolescence, emergency premiums and downtime, e.g. CPCON spare parts guide

The research says visibility. TraceIT is how you get it.

Every indirect purchase, spare parts, consumables, supplies, machines, tracked from goods-in to final use on a tamper-proof ledger. $1 per tracked unit per year, unlimited users.

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