In short: There are five common ways to manage tail spend: handle it in-house, use purchasing cards, buy through a B2B marketplace, use a master vendor payment platform, or outsource it to a managed service with a single creditor. They differ mainly in how much they cut suppliers and invoices, whether they include sourcing, and how much work stays with your own teams.
The five options
1. In-house, through the regular P2P process
Every supplier is onboarded and every invoice is processed by your own teams. Full control, but the highest cost per order and the largest supplier base.
2. Purchasing cards
Employees pay small purchases by card. Fast for low amounts, but spend data is thin, VAT recovery needs receipts, and many B2B suppliers do not accept cards.
3. B2B marketplace
One online store with many sellers and one invoice. Efficient for standard catalogue items, but limited to what the marketplace sells. Services and specialist items usually fall outside it.
4. Master vendor payment platform
A platform becomes the vendor of record and pays suppliers on your behalf, so you have one vendor in your ERP. Your own teams still find suppliers, negotiate and place orders.
5. Managed service with a single creditor
A partner takes over the full process for non-strategic spend: sourcing, ordering, supplier invoices and payments, and invoices you per purchase order. Your teams only approve requests.
Side by side
- Suppliers in your ERP: in-house all of them; with cards few; with a marketplace one per marketplace; with a master vendor platform or a single creditor service, one.
- Works with any supplier: yes for in-house, master vendor platforms and single creditor services; only card-accepting suppliers for P-cards; only marketplace sellers for a marketplace.
- Goods and services: both for in-house, master vendor platforms and single creditor services; mostly goods for cards and marketplaces.
- Sourcing included: only with a managed single creditor service; a marketplace offers catalogue search.
- Order-level spend data: available in all options except purchasing cards, where it is limited.
- Work left with your teams: everything in-house; receipts and reconciliation with cards; ordering with a marketplace; sourcing and ordering with a master vendor platform; only approval with a managed single creditor service.
Which option fits which situation
- Mostly standard items from catalogues: a marketplace or catalogues in your P2P tool.
- Many known suppliers you want to pay through one vendor: a master vendor payment platform.
- Many one-off requests, services and unknown suppliers, and little internal capacity: a managed service with a single creditor.
- Very low amounts, travel and subscriptions: purchasing cards, alongside one of the above.
The options can be combined. Many organisations keep cards for small expenses and use one central route for everything else outside their contracts.
Where Spot Buy Center fits
Spot Buy Center is a managed service with a single creditor, with its own purchase-to-pay software. Clients choose how much they outsource: Self-service, Admin service or Full service, which also includes sourcing. Tail catalogues are included in every plan. See single creditor services, procurement outsourcing and supplier consolidation.
Frequently asked questions
What is the difference between a master vendor and a single creditor?
Both give you one vendor. A single creditor model usually also covers ordering and sourcing; a master vendor platform mainly covers payment.
Can a marketplace replace tail spend management?
Only for the part of tail spend it sells. Services and one-off requests remain.
Which option reduces suppliers the most?
Options with one vendor of record for all non-strategic spend: a master vendor platform or a single creditor service.
