The deal was signed at 6% off. The invoices never got the memo.

Procurement savings are won in a meeting and lost across a thousand invoice lines, and the gap between the price agreed and the price paid rarely appears in any report.

By Steve 5 min read
Abstract bridge artwork for The deal was signed at 6% off. The invoices never got the memo.

A supplier negotiation concludes well. Volume is consolidated, a discount is agreed, and the saving is written into the budget for the coming year. Twelve months later, cost of sales as a percentage of revenue is where it was before. Nobody can point to a moment where the saving disappeared, because it never disappeared in one place. It leaked out a few pounds at a time, across several thousand invoice lines, in amounts too small for any individual to query. This is one of the most reliably recoverable margins in…

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