Tail Spend

Tail Spend

Tail spend is defined as the indirect, low-value purchases that are necessary to keep an organization running. This includes items like office supplies, janitorial services, and maintenance contracts. While tail spend doesn’t make up a large portion of an organization’s total spending, it can still have a significant impact on the bottom line.

The challenge with managing tail spend is that it’s often diffuse and spread out across many different departments and suppliers. This can make it difficult to get a handle on expenses and negotiate better deals. However, there are some procurement strategies that can help organizations better manage their tail spend.

Some tips for managing tail spend include:

– Conducting a spend analysis to understand where money is being spent

– Working with strategic suppliers to get volume discounts

– Creating policies and procedures to streamline processes

– Encouraging employees to be mindful of costs

By taking these steps, organizations can gain better control over their tail spend and save money in the long run.