DEFINITION
Revenue Leakage
Revenue leakage is earned revenue a business never collects because of process or control failure. Common causes are unbilled deliveries, discounts applied beyond policy, contract escalations never implemented, duplicate credit notes, and cash received but never applied.
Revenue leakage is harder to detect than cost leakage because no money leaves the bank — revenue simply never arrives, so there is no outbound transaction to review.
Detection requires reconciling the full order-to-cash chain: order against delivery, delivery against invoice, invoice against contracted price, and receipt against open invoice. Each break in that chain is a distinct leakage pattern.