Guide

Mastering Tail Spend Management

Mastering Tail Spend Management

Pages 28 Pages

This guide explains tail spend—the long “tail” of low-value, high-volume purchases (≈80% of transactions but ~20% of spend)—and why it matters: poor visibility, higher processing costs, supplier risk, wasted time, and weak stakeholder satisfaction. It recommends a structured approach: define tail for your org, set priorities (savings, lower transactional cost, team relief, stakeholder experience), assess bandwidth/budget/timing, and ensure systems integration. Execution tactics include leveraging data, consolidating suppliers, and applying REO (Retain, Eliminate, One-off) alongside KPIs. A Master Vendor model plus P2P/S2P tools, a procurement service center, change management, and user-friendly UX drive 5–20% savings, vendor reduction, better on-time payments, diversity gains, and sustained control.

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