Proactis Research Identifies Five Critical Indirect Spend Issues Costing Businesses Time and Money

Proactis has identified five critical failures in indirect spend management that are draining corporate resources and undermining financial control. For fintech professionals and procurement leads, these findings highlight a persistent gap between established purchasing policies and the reality of reactive spending, where a lack of visibility often prevents finance teams from intervening before capital is committed.

What was announced

Proactis, a source-to-pay solutions provider, released findings based on its work with finance and procurement teams, pinpointing why indirect spend—the goods and services required for operations but not part of a core product—remains a significant financial leak. The research identified that many organisations manage this spend reactively, often only gaining visibility once an invoice arrives, which is too late to challenge or redirect the expenditure.

Key issues include a lack of pre-approval visibility, which prevents finance departments from vetting suppliers before costs are incurred. Furthermore, poor maintenance of recording systems and data duplication lead to incorrect supplier records, resulting in payment errors and unnecessary administrative checks. The study also found that procurement teams frequently rely on fragmented local reports and separate systems, forcing staff to spend excessive time reconciling financial records manually.

These inefficiencies have a direct impact on the bottom line beyond immediate overspending; businesses lacking unified data are unable to negotiate renewed contracts effectively due to a lack of evidence. Proactis highlighted the tangible benefits of addressing these gaps through specific case studies. Wigan Council achieved a 66% improvement in accounts payable efficiency and £120,000 in operational savings, while the bookmaker Betfred saw a 47% efficiency gain in its accounts payable department after implementing a new source-to-pay system.

"Finance teams we have worked alongside often describe indirect spend as the area they have the least visibility into and the most concern about. The purchasing process exists, but in practice, staff follow the path of least resistance. By the time invoices arrive, the opportunity to challenge or redirect that spend has passed."

Charlotte Carter, VP Solution at Proactis.

The companies involved

Proactis is a specialist in source-to-pay (S2P) software and services, positioning itself as a provider that connects purchasing, supplier, and contract information into a single, visible process. With over 30 years of experience in the procurement and finance software industry, the company serves a diverse range of clients across both the public and private sectors, helping them to improve efficiency and spend visibility.

The company is currently a portfolio business of Pollen Street Capital, a private equity firm that focuses on the financial and business services sectors. This backing places Proactis within a broader ecosystem of fintech and professional services firms aimed at driving digital transformation in mid-market and enterprise organisations. By focusing on the "indirect spend" niche—which includes everything from office supplies to professional services and utilities—Proactis operates in a segment of the market where digitisation has historically lagged behind direct procurement. The firm’s focus remains on streamlining the "path of least resistance" for employees, ensuring that compliance with procurement policy is achieved through better user experience rather than just complex internal mandates.

What this means

The persistence of "maverick spend" and reactive management in indirect procurement suggests that many digital transformation projects have failed to reach the edges of the organisation. While direct supply chains are often highly optimised, the "tail spend" remains a black hole for many CFOs. This announcement puts pressure on legacy ERP providers who may offer procurement modules that are too cumbersome for non-specialist staff to use correctly. The industry is moving toward a "consumerised" procurement experience; if fintech tools cannot make the right buying route the easiest one, businesses will continue to leak margin through administrative friction and unvetted supplier relationships.