What Is Maverick Spend & How Do You Prevent It?

Untracked purchasing quietly erodes procurement savings in organizations across every industry. Companies that purchase outside of approved supplier contracts (a practice known as maverick spending) lose 10-50% of their negotiated savings. This guide explains what maverick spending is, why it happens, how to detect it, and the proven strategies Procurement and Finance teams can use to regain control, improve compliance and protect the bottom line.

Maverick spend definition & key concepts

Maverick spend is any purchase made outside an organization's established procurement policies, approved contracts or preferred supplier lists. Sometimes called rogue spend or maverick buying, it represents any transaction that bypasses the formal procurement process — whether that's ordering from a noncontracted vendor, skipping the purchase order (PO) requirement or even something as seemingly harmless as using a corporate credit card without prior approval.

The term also overlaps with off-contract spending, though there's a subtle distinction. Off-contract spending simply means purchasing from a supplier outside your negotiated agreements, while maverick spend is broader and includes any noncompliant purchasing behavior, regardless of vendor status.

Here's what matters: Maverick spenders are rarely acting with malicious intent. Most employees bypass procurement processes out of convenience, urgency or simply because they don't know the policies exist. Someone needs office supplies today, finds a vendor online, places an order and submits an expense report. They got the job done — but they also sidestepped negotiated pricing, created extra reconciliation work for accounts payable and undermined spend visibility.

It's also worth distinguishing maverick spend from tail spend. Tail spend refers to the high volume of low-value purchases that are difficult to manage centrally (think small, irregular transactions spread across many suppliers). Tail spend may be compliant, but it's unmanaged. Maverick spend, by definition, is inherently noncompliant. It breaks the rules, even if the individual transaction is small.

Common examples of maverick spending

Maverick spend shows up in predictable patterns across organizations. These are the most common scenarios Procurement teams encounter.

Purchasing from a nonpreferred vendor

An employee needs office supplies and searches online, finding a vendor with fast shipping. They place the order without checking the preferred supplier list. The purchase goes through, but the company misses the 15–20% discount already negotiated with their contracted supplier. Over time, these one-off purchases from nonpreferred vendors really add up. The company pays higher unit costs, loses volume-based rebates and fragments its supplier base. Worse, nonpreferred vendors haven't been vetted for quality standards or compliance requirements, introducing risk the Procurement team can't easily manage.

Bypassing purchase order requirements

A department manager hires a consultant to help with a software implementation project. The work begins immediately, but no PO is issued. Weeks later, an invoice arrives in accounts payable. No one in procurement knew the engagement existed. Without a PO, there's no contract on file, no clear scope of work and no approval trail. Accounts payable scrambles to reconcile the noncompliant purchase, and the Procurement team loses visibility into professional services spend. This pattern is especially common with software subscriptions, freelance contractors and project-based services.

Uncontrolled corporate credit card usage

An employee uses their corporate credit card to buy equipment for an upcoming client presentation. The purchase seems urgent, so they skip the approval workflow and plan to submit the receipt for reimbursement later. The transaction bypasses procurement entirely. There's no record in the purchasing system, no way to track whether the expense aligns with budget, and no opportunity to verify whether a preferred vendor or negotiated rate was available. When corporate credit cards operate without preapproval requirements or spending controls, they become a common source of maverick spend.

The true cost of uncontrolled maverick spending

Maverick spend impacts far more than the bottom line. It undermines the entire procurement function. While the immediate financial hit is obvious, the cascading effects touch supplier relationships, compliance posture, budget accuracy and operational efficiency across Finance and Procurement teams.

Organizations lose 10–50% of their negotiated savings to maverick purchasing. That's value your Procurement team already secured at the negotiation table but quietly lost to off-contract purchases. In organizations without a procure-to-pay (P2P) solution that provides clear visibility into company spend, the problem runs even deeper. Because indirect spend is typically less managed than direct spend, indirect spend is the perfect place for maverick purchasing to slip through the cracks. According to The Hackett Group, nearly 30% of indirect spend is off-contract, though some researchers have seen companies with 80% of indirect spend occurring off-contract. This makes it nearly impossible to realize intended cost savings or maintain spending discipline.

The consequences of maverick spend are multi-dimensional.

• Missed negotiated discounts and higher costs: Every purchase made outside approved contracts means you're paying more than necessary and forfeiting volume discounts your team already negotiated.
• Weakened supplier relationships and potential contract breaches: When you consistently buy off-contract, preferred suppliers lose confidence in your commitment, jeopardizing future pricing and service levels.
• Compliance risk and regulatory exposure: Rogue suppliers may not meet your organization's quality, security or regulatory standards, creating legal and reputational vulnerabilities.
• Inaccurate financial forecasting and budget overruns: Untracked purchases make it impossible to forecast accurately or close the books cleanly, leading to budget surprises and strained cashflow.
• Wasted time for Accounts Payable and Procurement teams reconciling rogue transactions: Finance teams spend hours matching invoices without purchase orders, chasing approvals retroactively and cleaning up data instead of focusing on strategic work.

That said, not all out-of-contract spending is negative. Sometimes employees discover competitive alternatives worth evaluating for future contracts. The key is distinguishing between occasional strategic exploration and systemic noncompliance.

Here's how maverick spend affects your organization:

Root causes of maverick spend

Understanding why maverick spend occurs is the first step toward controlling it. You might think maverick spend is caused by isolated issues, but in reality, the causes are interconnected.

Complex or unclear procurement processes

When procure-to-pay workflows involve excessive bureaucracy or confusing approval steps, employees find workarounds. Industry research consistently identifies process complexity as the leading trigger for maverick purchasing. If your approval workflows require multiple sign-offs, unclear authorization thresholds or navigation through disconnected systems, employees will bypass them to get their jobs done. The problem isn't always malicious intent — it's friction. When compliance takes longer than simply ordering from a nonpreferred vendor, many employees choose the path of least resistance. That's why the best procurement policies balance control with usability. If the formal process is harder than going rogue, you've already lost the battle.

Poor spend visibility & data gaps

Without centralized spend data and real-time reporting, managers and Procurement teams can't identify off-contract purchasing until it's already a bigger problem. When spend information lives in siloed systems (invoices in accounts payable, POs in procurement, credit card statements in finance) you lack insight into who's buying what, from whom and at what price. Data silos don't just slow down analysis, they create blind spots where maverick spend thrives undetected. By the time reconciliation happens at month-end, unauthorized purchases have already been made, suppliers paid and negotiated savings lost. Organizations struggling with spend visibility often discover that a significant portion of their indirect purchasing occurs entirely outside their view.

Insufficient employee training & awareness

Many employees simply don't know the procurement policies exist or understand why compliance matters. This can be due to a variety of reasons, from onboarding gaps to decentralized teams operating independently without regular touchpoints with procurement. When new hires aren't trained on purchasing protocols or when remote departments develop their own informal supplier relationships, noncompliant purchasing becomes the norm rather than the exception. Even well-intentioned employees may assume that small purchases don't require formal approval or that speed justifies skipping a PO. Without ongoing education that helps employees understand how complying with purchasing rules leads to tangible outcomes like cost savings, supplier reliability and budget accuracy, they won't prioritize following the rules.

Maverick spend analysis & detection

Before you can reduce maverick spend, you need to measure it. That starts with understanding your baseline.

Calculating your maverick spend rate

Maverick spend rate is the percentage of total spend that occurs outside approved contracts or procurement channels. It's the single most important metric for tracking procurement compliance.

Here's the formula:

Maverick spend rate = (noncompliant spend ÷ total spend) × 100

For example, if your organization spent $5 million total and $250,000 was spent with unapproved vendors or outside negotiated contracts, your maverick spend rate is 5%.

According to Ardent Partners, the average organization sees a 30% maverick spend rate. Best-in-class Procurement teams typically maintain rates of just under 10%. If your rate is above 10%, you have a significant opportunity to recapture value. Think about it: Even a 5% reduction in a $50 million spend base can deliver $250,000 in annual savings.

Detection methods & tools

Detecting maverick spend requires a systematic approach to spend data. Start by aggregating your purchasing information from multiple sources, including accounts payable invoices, PO systems, corporate credit card statements and ERP transaction logs.

Next, categorize that data by department, vendor and spend category. Flag any purchases that lack a corresponding PO, come from suppliers not on your approved vendor list or fall outside negotiated contract terms. Cross-reference invoice pricing against contracted rates to catch off-contract purchases disguised as compliant spend.

Manual detection works for small organizations, but it doesn't scale. Spend management software and analytics platforms automate this process by continuously monitoring transactions, consolidating duplicate vendor records and spotlighting anomalies in real time. Tools like Sievo use AI-driven pattern recognition to identify maverick purchasing trends before they become budget problems.

Proven strategies to reduce maverick spending

Controlling maverick spend requires a multi-layered approach that involves policy, visibility, people and technology. Organizations that address all these elements see measurable improvements in compliance, cost savings and procurement efficiency.

Establish clear policies & approval workflows

A well-documented purchasing policy is your first line of defense. It should define what constitutes approved spend, specify who can authorize purchases at different dollar thresholds and clarify when a PO is required. Without these guardrails, employees operate in a gray area where discretion becomes inconsistency.

Equally important is the approval workflow itself. If the process involves excessive bureaucracy or unclear steps, employees will find workarounds. The best way to enforce policies is making compliance easier than noncompliance. Streamline your workflows to balance control with usability. Approvals should be fast enough that employees don't bypass them out of frustration. Risk-based thresholds help: Automate low-risk purchases while scrutinizing high-value or sensitive transactions.

Centralize procurement & improve spend visibility

You can't manage what you can't see. Consolidating spend data into a single platform gives managers and Procurement teams real-time visibility into all purchasing activities across departments. This transparency makes it easy to identify off-contract purchases, track spending patterns and spot emerging risks before they escalate.

Maintain an up-to-date preferred vendor list that's accessible to all employees. When people know which suppliers are approved and why, they're more likely to use them. Strategic sourcing plays a critical role here. Ensure your contracts cover the categories where off-contract purchasing is most concentrated. If employees frequently buy outside the system for a particular category, it's a signal that your contracted options aren't meeting their needs. For more guidance, see these spend management best practices.

Invest in employee training & accountability

Many employees bypass procurement policies simply because they don't understand why those policies exist or how maverick spending affects the company. Education changes that. Connect compliance to outcomes people care about, like budget stability, job security and operational efficiency.

Training shouldn't just be a one-time event during onboarding. Reinforce procurement expectations regularly through quarterly refreshers, role-based modules or brief updates when policies change. Hold people accountable by clearly defining roles and responsibilities in the purchasing process. When employees understand their part in the bigger picture — and see that others are following the same rules — compliance becomes part of the culture.

Leverage automation & eProcurement solutions

The right technology turns procurement from a bottleneck into an enabler. P2P automation and eProcurement tools give employees an easy, guided purchasing experience with built-in controls. Features like automated PO creation, catalog-based ordering from approved suppliers and real-time spend dashboards reduce friction and maverick buying simultaneously.

Modern platforms integrate with your ERP and financial systems, ensuring that every purchase flows through the proper channels without adding manual steps. Employees get faster approvals, Procurement teams gain visibility and finance benefits from cleaner data. Esker's Source-to-Pay automation platform, for example, helps companies gain spend control and reduce maverick spend by centralizing procurement workflows, automating compliance checks and providing actionable spend intelligence — all within a single platform designed to make policy adherence the path of least resistance.

Frequently asked questions about maverick spend

What is maverick spend rate?

Maverick spend rate is the percentage of your organization's total spend that occurs outside approved procurement channels or contracts. Ardent Partners research shows that most organizations experience a maverick spend rates of 30% of total spend, though top-performing Procurement teams achieve compliance rates above 90%. Tracking this metric over time is essential, because it's the clearest indicator of whether your spend control initiatives are working or if off-contract purchasing continues to erode negotiated savings.

What is a maverick policy?

A maverick policy is an internal procurement guideline that defines acceptable purchasing behavior within your organization. It sets clear spending thresholds for when POs are required, designates which suppliers and contract spend categories are approved, and outlines consequences for non-compliance. The policy gives employees a clear rulebook to follow and provides managers and the Procurement team with enforcement authority. The best maverick policies balance control with usability. Because if the rules are too rigid, employees will find workarounds.

How does maverick spend differ from tail spend?

Tail spend refers to the large volume of low-value purchases that procurement doesn't actively manage — think office supplies, minor services or one-off items. It may still be compliant purchasing, just not strategically sourced. Maverick spend is defined by noncompliance. It's purchasing that bypasses established policies and approved contracts regardless of dollar amount. While some maverick purchases do end up in the tail spend category, the two concepts aren't interchangeable. Tail spend is about size and visibility; maverick spend is about breaking the rules.

How can businesses start reducing maverick spend today?

Start with a spend analysis to establish your baseline maverick spend rate and identify where off-contract purchasing is concentrated. You don't need to solve everything at once. Prioritize quick wins: document a clear purchasing policy if you don't have one, improve spend visibility so managers can see what their teams are buying, and communicate why compliance matters to the business. Once you've addressed the basics, evaluate whether procurement automation can streamline approval workflows and make compliant purchasing easier than going rogue.