Maverick Spend: What It Is, What It Costs, and How to Stop It
Maverick spend is purchasing that happens outside an organization's approved procurement channels. It is the purchase made directly by a department manager from a local supplier without going through the procurement system. It is the expense claim for operational supplies that bypasses the formal requisition process. It is the subscription renewed on a corporate credit card without a purchase order. It is, in almost every organization, more common and more costly than procurement leaders realize.
Understanding why it happens, what it costs and how to prevent it is a foundational challenge of procurement governance, particularly in the long tail where formal controls are weakest.
What Is Maverick Spend?
Maverick spend, also called rogue spend or off-contract spend, is any organizational purchasing that bypasses the approved supplier list, the required approval process, or both. It is distinct from unauthorized spending in that it is usually not intentional noncompliance — most maverick spend happens because the formal procurement process is perceived as too slow, too complex, or too impractical for the item being purchased.
It concentrates in the long tail, where items are individually low value, the approval overhead looks disproportionate, and bypassing the process seems inconsequential. Each instance is small. Collectively they are a significant share of organizational spend operating outside governance entirely.
What Causes Maverick Spend?
The cause is friction in the formal process. When the approved channel means a multi-step requisition, a wait for approval, and a purchase order process slower than the operational need, finding a faster route is the rational response. The process exists to provide governance, but too burdensome for the value of the transaction and it gets bypassed.
Other causes: non-procurement staff unaware of the approved process, no approved catalog covering what teams regularly need, a culture that tolerates informal purchasing for convenience, and workflows not calibrated to the real urgency and value of different purchase types.
The Real Cost of Maverick Spend
The direct cost is the pricing premium on purchases made outside contracted relationships. Organizations running preferred supplier programs with negotiated rates find maverick purchases of equivalent items run 15 to 35 percent more expensive than the approved channel. Across a large tail portfolio that premium is a recoverable budget loss.
The indirect costs matter too. Purchases outside the approval channel lack the documentation audit review requires. Each one with a new vendor adds an unmanaged supplier to the register. And because that purchasing is invisible to spend analytics, procurement cannot report accurate total spend.
How to Measure Maverick Spend in Your Organization
Measuring it means comparing purchasing outside the system, mainly credit card statements, expense claims and accounts payable records, against purchase orders from the formal process. The gap between total organizational spend and formally approved spend is your baseline, and most organizations find it higher than expected.
How to Reduce Maverick Spend
The effective approaches address the cause: friction. Making the approved channel faster and easier than the informal one removes the motivation for non-compliance. That means an approved catalog covering what teams actually need, thresholds proportionate to transaction value so low-value purchases skip multi-level authorization, and a purchasing interface on mobile and desktop so the formal channel is always the convenient one.
Enforcement through system controls rather than manual monitoring matters too. If the system makes an unapproved purchase structurally difficult, maverick spend is prevented by design rather than by compliance culture.
How Borong Eliminates Maverick Spend by Design
Borong reduces maverick spend with catalog controls and workflow configuration that make the approved channel the easiest option. Approved vendor catalogs restrict purchasing to pre-verified suppliers at contracted rates. Thresholds calibrate so small operational purchases clear same-day without senior management. And the consolidated marketplace puts a broad range of verified suppliers in one place, removing the main practical reason teams go around the formal channel: that the approved options do not cover what they need.
MIDAS provides continuous monitoring of spend compliance, flagging purchasing patterns that suggest maverick activity and tracking the proportion of total spend flowing through approved channels over time.
Frequently Asked Questions
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What is the difference between maverick spend and unauthorized spend?
Maverick spend bypasses the process but is not necessarily unauthorized in the sense of being fraudulent or against company policy. Unauthorized spend is procurement that violates explicit policy. In practice, the terms are often used interchangeably.
What percentage of procurement spend is typically maverick?
Industry estimates suggest 20 to 40 percent of organizational spend occurs outside formal procurement channels. The actual figure varies significantly by industry and the maturity of the procurement function.