Where does revenue get stuck?Start with the handoffs.
Revenue leaks when what you quoted, contracted, delivered and billed stop matching. The gaps usually sit between teams and systems. Check where yours might be, then size a rough range.
Where it leaks
Leakage rarely sits in one system. It sits between them.
Gaps appear when pricing, contracts, usage, billing and renewals fall out of sync. The result can be unbilled revenue, discounts that last too long, or missed renewals. Select a handoff to see examples.
Quote and approval
- A discount keeps running after its intended term.
- Old price books are still in use.
- Free months or ramp pricing are tracked outside the system.
- A quoted product has no match in billing.
Contract to order
- Contract terms differ from the approved quote.
- A price increase is in the contract but never applied.
- An amendment is signed but never reaches billing.
Entitlements and provisioning
- A customer uses more seats, modules or volume than they bought.
- Access starts before billing does.
- Usage is never checked against the contract.
Billing and invoicing
- Billing starts on a different date than the contract says.
- Usage is not invoiced.
- Mid-term upgrades are not billed correctly.
- Invoices are built by hand across more than one billing system.
We compare invoices with the contract. How revenue is accounted for is a separate question for your finance team and auditors.
Collections and cash
- Failed payments are not followed up.
- Credits are issued without approval.
- Payments cannot be matched to open invoices.
Renewals and expansion
- A renewal deadline passes without action.
- A customer renews at the old price when an increase should apply.
- Sales, Customer Success and Finance see expansion opportunities separately.
After an acquisition
- The same customer exists in more than one CRM.
- Each business has its own price books and contract templates.
- Each business defines ARR in its own way.
Each acquired business brings its own systems, so the same gaps can repeat.
Size the range
A rough range for your ARR
Published research puts revenue leakage at 3 to 9% of ARR. Move the slider to see that range in dollars. Nothing is stored and no email is needed.
Revenue leak calculator
An illustration, not a quote, forecast or promise. Your real number depends on your own records.
Source for the 3 to 9% range: MGI Research, 2024, across 150 enterprise finance teams.
Where to start
Six signals worth checking first
You don’t need all six before you talk to us. One number alone doesn’t prove leakage, but it shows where to look.
- Discounts vs policyPlus the number of approval exceptions
- Quote, contract, invoiceDifferences across a sample of customers
- Credit memosHow often they are issued, and billing accuracy
- Renewal timingShare acted on at least 90 days before expiry
- Price increasesAllowed by contract vs applied at renewal
- Usage vs entitlementsCompared with what is billed
“If you can’t pull one of these without a spreadsheet exercise, that is usually the handoff to start with.”
How we look into it
From finding a gap to fixing it
- Assessment
Find the gaps
Compare quotes, contracts, billing records and entitlements. List where they disagree.
- Assessment
Understand why
Trace each gap to its cause: old pricing rules, bad data, missing handoffs, manual workarounds.
- Assessment
Decide what to fix first
Rank the problems by size and effort.
- Separate scope
Make agreed improvements
If you want our help, we fix the process, system or integration, and measure against the baseline where we can.
We don’t promise that every gap will be closed or that any amount will be recovered.
The assessment
A model is a starting point. An assessment is evidence.
We build a baseline from your contracts, transactions and process data, and agree a calculation method with your team. An engagement does not apply a generic percentage to your ARR.
- 20-minute call
- Scope agreed
- Assessment
- Findings
- You decide next steps
The assessment is separately scoped and paid, and it looks at one company’s records and systems.
The next step
Bring one broken handoff.
Tell us where you suspect revenue is slipping and which systems are involved. In a 20-minute call, an Enterprise Architect will help you decide whether a closer look is worthwhile.
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