{"id":62743,"date":"2024-09-25T08:36:54","date_gmt":"2024-09-25T08:36:54","guid":{"rendered":"https:\/\/www.hashmicro.com\/blog\/?p=62743"},"modified":"2025-12-23T04:37:48","modified_gmt":"2025-12-23T04:37:48","slug":"indirect-procurement","status":"publish","type":"post","link":"https:\/\/www.hashmicro.com\/blog\/indirect-procurement\/","title":{"rendered":"Everything You Need to Know About Indirect Procurement"},"content":{"rendered":"

Indirect procurement can make up as much as 80% of a company\u2019s purchases<\/a>, yet it remains largely unmanaged. This lack of attention often results in uncontrolled maverick and tail spend, eating into company revenue.<\/p>\n

With indirect procurement growing 7% annually<\/a> since 2011, neglecting it means missing opportunities to optimize spending. Left unchecked, this significant portion of your budget can cause financial leakage<\/a> and inefficiencies across the business.<\/p>\n

To combat this, businesses must focus on managing indirect spend with better procurement strategies and oversight. Implementing tools for visibility and control can significantly reduce costs and improve operational efficiency.<\/p>\n

This article will discuss indirect procurement in detail, including what it does, how it contributes to profitability, and the best practices for maximizing profit while cutting costs effectively.<\/p>\n

What is Indirect Procurement?<\/b><\/h2>\n

Indirect procurement, also called indirect spend, is the process of acquiring goods and services necessary for the daily operations of a business but not directly involved in producing its core products or services.<\/p>\n

This includes categories like office supplies (e.g., stationery, furniture), IT services (e.g., software licenses, hardware, technical support), professional services (e.g., legal and marketing consultations), facilities maintenance, utilities, and travel management.<\/p>\n

While indirect procurement doesn\u2019t directly impact product output, it is crucial to ensuring that business operations run smoothly and employees have the resources they need to function effectively.<\/p>\n

The rising importance of virtual goods and services has increased focus on optimizing indirect procurement is a key area for cost reduction and operational efficiency. Ignoring this can result in missed opportunities for sustainable savings and improved profitability.<\/p>\n\n\n\n
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Key Takeaways<\/b><\/span><\/h3>\n
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  • Indirect procurement can make up 80% of purchases, but often goes unmanaged, causing inefficiencies.<\/li>\n
  • Managing indirect procurement well requires visibility, strategic sourcing, and digital tools to cut costs.<\/li>\n
  • Key KPIs include cycle times, cost savings, and vendor management for better efficiency.<\/li>\n
  • HashMicro’s procurement software enhances indirect procurement with tools for vendor management and cost tracking.<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

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