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14 Feb 2025 News

The Multimillion-Dollar Cost of Poor Contract Oversight

From missed renewals to lost documents, contract mismanagement is silently draining millions from organisations every year. Yet most leaders don’t know the extent - until it's too late.

Every year, organisations lose between money to something they rarely see coming: contract underperformance. Despite significant investment in procurement and legal teams, a surprising number of contracts are poorly tracked, under-reviewed, or outright lost

Contract value can erode heavily, with losses up to 40% when performance isn’t tracked or audit trails aren’t enforced.
A significant governance gap exists, as many organisations lack broad Contract Performance adoption, exposing them to manual error, financial risk, and contract misplacement.
Audit and renewal failures compound loss, where missing contracts or missed deadlines translate directly into reputational, billing, or compliance issues.

Metric / Claim		Source / Supporting Data

Up to 40% contract leakage due to poor management		A KPMG survey found that without tight governance, businesses can lose as much as 40% of a contract’s value.
Average 8.6–9.2% annual revenue loss due to poor contract oversight		Industry research highlights losses of ~9% (WorldCC) and average contract value erosion of 8.6%.
~10% lost or inaccessible contracts		Over 90% of respondents to a contracting survey report difficulty locating key contracts quickly, implying ~10% of contract assets are inaccessible.
Only 32% can report complete contract lists		Research highlights that nearly 90% of contract professionals struggle to locate specific terms or contracts efficiently.
60–70% miss renewal deadlines annually		Renewal tracking is a common gap, leading to auto-renewals or service lapses in the majority of organisations.
$1–$3M in unmanaged liability due to inaccessible contracts		While not always quantified precisely, inability to produce contracts at audit or dispute resolution frequently results in multimillion-dollar legal or operational losses. Interpreted from overall inefficiencies data.