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Category Spend Analysis Calculator

Work out category spend analysis instantly with clear inputs, formula shown and shareable results.

About Category Spend Analysis Calculator

Category analysis looks beyond total spend to the shape of it. A low average spend per supplier signals fragmentation, and a low average order value signals a transaction cost problem — both are addressable without any price negotiation at all.

Formulas

Category share

Share % = Category spend / Total spend x 100

Average spend per supplier

Per supplier = Category spend / Supplier count

Average order value

AOV = Category spend / Purchase order count

Worked example

With the default values below, Category Spend Analysis Calculator returns Category share of total spend of 13.333%. Change any input above and every figure here is recalculated in your browser.

Inputs used

Category spend
320,000,000
Total organisation spend
2,400,000,000
Suppliers in the category
64
Purchase orders in the category
4,800

Results

Category share of total spend
13.333%
Average spend per supplier
$5,000,000.00
Average order value
$66,666.67
Transactions per supplier
75.0

Step by step

  1. 1Values used
  2. 2Category share
  3. 3Average spend per supplier
  4. 4Average order value
  5. 5Category share of total spend= 13.333
  6. 6Average spend per supplier= 5,000,000.00
  7. 7Average order value= 66,666.67
  8. 8Transactions per supplier= 75.0

Assumptions and limits

  • The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
  • In particular, this calculator does not take inflation, tax, fees or charges or compounding frequency into account.
  • Figures are rounded for display to 3 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

What average order value is too low?

When it approaches the cost of raising and processing the order, commonly 2,000-5,000. Below that, aggregate into scheduled or blanket orders.

Which categories should be prioritised?

High spend with high fragmentation. Concentrated categories are usually already well managed, so the incremental gain is smaller.

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