Indirect spend – also known as non-production costs – is a catch-all term for everything spent by an organization outside of its production process. Put simply, it covers all purchases made related to running the business other than those directly related to producing items or services. Examples include IT equipment and services, advertising, office supplies and facilities management. Engaging in effective indirect spend management requires organizations to be proactive in tracking and understanding their indirect purchase behavior, allowing them to optimize the value and efficiency of their operations.