Size your spend — a category map for your sector

SIZE YOUR SPEND

A category map for your sector, at your scale.

Most finance leaders can tell you what they spent last year in total. Far fewer can say whether any individual category is normal for an organization of their type — because until now there has been nowhere to look.

This is that reference. It will not tell you what you could recover. It will tell you which categories are worth a question.

What you are looking at

We analyzed the reported figures of 5,698 organizations across six sectors, and calculated for each spending category the median share of total expenses that organizations of similar size and type report.

Enter your sector and your total annual expenses. The tool applies those medians at your scale, so instead of an abstract percentage you see what the median organization like yours reports in dollars — and how widely the sector varies around it.

Every figure carries the number of organizations it was drawn from. A median from 2,176 peers deserves more weight than one from 92, and you should be able to see which is which.

Three things it shows

Where the money sits. Every category ranked by median share, with the dollar figure at your scale. This is the shape of a typical cost base in your sector.

How much the sector varies. The share of organizations reporting more than half again above the median. High variation means organizations differ a lot — usually for operational reasons.

The concentration. How much of the mapped spend sits in the largest three categories against everything else. The shape itself tells you what kind of organization you are looking at.

How to read it

Three principles, and they matter more than the numbers.

A median is a middle, not a target

Half of organizations sit above it by definition. Being above the median is not a finding. It is the starting condition for half the sector, and the useful question is why — not whether.

Variation is information about the sector

When 52% of behavioral health organizations run travel well above the median, that tells you travel is a category where operating models differ enormously. It says nothing about whether any particular organization is buying well.

Size is the biggest single variable

Category shares move with scale. The medians here are drawn from organizations of comparable size, which is why we ask for your expenses rather than applying one number to everyone.

What it cannot tell you

Stated plainly, because a tool that hides its limits is worse than no tool.

It cannot tell you that you are overpaying

Nothing in a median establishes that any arrangement is uncompetitive. A category above the median may reflect service mix, geography, building stock, acuity, program structure or a deliberate decision. Every one of those is a good reason and none of them is visible here.

It cannot estimate recoverable value

You will not find a dollar figure here for what you could save, because no honest one can be produced from a median. Recoverable value depends on your actual terms, your volumes, your contract dates and what the market will offer you specifically.

It does not know your contracts

A category with two years of term remaining is a different conversation from one renewing next quarter. A category you competitively bid last year should be left alone. The tool cannot see either.

It maps categories, not every dollar

The map covers the indirect categories we can compare reliably. It is not a complete expense breakdown, and the combined figure is the sum of what we map rather than your total indirect spend.

How to use it well

The output is a list of questions. These are the ones worth asking, in order.

Start with the largest categories, not the most variable ones. A small percentage of a large category is worth more than a large percentage of a small one. The dollar column is the one to read first.

For each of the top five, ask when it was last competitively tested. Not renewed — tested. If the answer is more than three years, or nobody is sure, that is the category to look at.

Ask who owns it. Categories with no clear owner drift furthest. If three people each own part of a category and nobody owns the whole, that is the pattern this work exists to address.

Discount anything the map flags as a poor starting point. Where a category is shaped by clinical need, program structure or purchasing arrangements, the median is not enough to act on and we say so in the output.

Check your own figure against the median before drawing any conclusion. If you sit below it, you may already be buying well. That is a useful answer and it costs nothing to establish.

Your sector

Total annual expenses

Choose a sector and enter a figure to see the category map.

What we would do with this

The map is where a conversation starts, not where it ends. In a 45-minute session we would put your actual reported figures against it, and you would tell us the things the numbers cannot show.

What is under contract

A category with two years of term remaining is a different conversation from one that renews next quarter.

What was recently tested

If you competitively bid a category last year, we would leave it alone and say so.

What your model explains

Service mix, geography, building stock and program structure all move these numbers for good reasons.

Start a conversation See how cost recovery works