Where the money actually is

Twenty percent of the cost base holds eighty percent of the recoverable value. Here is where it tends to sit in a mid-market company, and why nobody has found it.

The name of this firm is not an accident. In every cost base we have worked on, a small number of lines hold most of the recoverable value. Not because the rest is efficient, but because the big money concentrates in a few places, and those places are the ones with the weakest governance.

The usual suspects

Agency and media spend. Large, discretionary, governed by relationships rather than contracts, with fees that predate AI and supply chains nobody has mapped.

Enterprise software and SaaS. Renewals signed at the vendor's best offer. Licences above headcount. Acquired businesses with duplicate stacks.

Cloud. Commitments bought at a scale the business no longer runs at, or never bought at all.

IT services and telecom. Contracts nobody has re-bid in years, on the assumption that they are too complicated to change.

Professional services. The consultants, advisors, and specialists that accumulate around a growing business.

Why nobody has found it

Each line has an owner who defends it and nobody who challenges it. The finance team sees the bill and not the contract. The function sees the vendor and not the market price. Procurement, if there is one, is downstream of the decision.

The money is not hidden. It is unowned.

The eighty twenty of the work

Find the five largest addressable lines. Benchmark each against the market. Renegotiate, consolidate, or replace, in that order. Put an owner and a renewal date against every contract that survives. Repeat quarterly.

That is most of the value, in most businesses, most of the time. The rest is detail.