Is revenue leakage the same as bad debt?

No. Bad debt is money billed to a customer who can't or won't pay. Leakage is mostly money that's never billed, or a small part of an invoice nobody follows up, from customers who would pay if asked.

How often should we check for revenue leakage?

Weekly at least. Most leaks get harder to recover the older they are: a customer remembers a short payment from last week, not from last year.

Should we chase every small difference?

No. Set a floor below which a difference is noise (bank fees on a wire, a few cents of rounding) and write those off under a small-balance limit. Chase what's worth a person's time.

Revenue leakage for wholesalers and agencies: where money slips between the order and the bank

7 min readUpdated October 14, 2026By the thruflow team

The short answer

Revenue leakage is money a business has earned but never bills, or bills and never fully collects, without anyone deciding to give it up. For wholesalers and agencies it hides in seven places: goods shipped but not invoiced, work done but not billed, customers who pay part of an invoice and stop, early-payment discounts taken after the deadline, vendors charging more than agreed, bills that run past a purchase order, and sales made under the price list or below cost. You find it by comparing what happened (shipped, delivered, paid, charged) with what was billed and collected, every week rather than at year end.

Why it goes unnoticed

Leakage is rarely one big mistake. It's a carton that shipped on a Friday and never made it onto an invoice, a customer who paid $3,712.50 against $4,125.00 and nobody asked about the rest, or a supplier whose price crept up by forty cents a piece. Each is small enough to miss, and none of them shows up as an error: the books balance, they just balance without the money.

Because nothing fails, nobody is told. The only way to find leakage is to look for it on purpose, by comparing the operational record (shipments, time, purchase orders, price lists) with the financial one (invoices, payments, credits, bills).

The seven places it hides

Shipped, not invoiced: goods left the warehouse, but the invoice was never made, sat as a draft, or was voided and never reissued.
Work not billed: for agencies, hours, costs and milestones that are ready to bill and on no invoice. This is the agency's work in progress, ageing.
Paid short: a customer paid most of an invoice and stopped, with no credit memo or agreement covering the rest.
Discount taken late: a customer took an early-payment discount (2/10 net 30, for example) after its window had closed.
Vendor price up: a supplier billed more per item than on their last bill for the same product, without anyone agreeing a new price.
Billed past the PO: a freelancer, printer or media vendor billed more against a purchase order than it allowed.
Under the list, or below cost: a sale made under the customer's agreed price, or for less than the goods cost. This money is usually gone, but it shows where pricing slips.

A worked example

One week at a small apparel wholesaler. None of these was a mistake anyone saw.

Leak	What the books show	Amount
Shipped, not invoiced	SO-1042 shipped Oct 2; its invoice is still a draft	$1,638.00
Paid short	INV-2041 is $4,125.00; $3,712.50 was paid on Oct 1, nothing since	$412.50
Discount taken late	INV-2033 on 2/10 net 30 is $4,820.00; $4,723.60 was paid on day 31	$96.40
Vendor price up	200 blanks at $3.40 each; the last bill charged $3.00	$80.00
Total		$2,226.90

The discount is 2% of $4,820.00, which is $96.40. The price rise is $0.40 on each of 200 pieces, which is $80.00. Every figure comes straight from documents the business already has.

How to find it every week

List every shipment from more than a few days ago and check each has a sent invoice.
For agencies, list work marked ready to bill and check it's on an invoice within a week.
List invoices that are past due and part paid, where nothing has come in for a week.
Compare each early-payment discount taken with the date it was paid.
Compare each vendor bill's prices with that vendor's previous bill for the same items.
Compare vendor bills against their purchase orders, allowing your usual tolerance.
Once a month, look at sales made under the price list or below cost, to learn from them.

How to ask for it back

Be specific: the invoice or bill number, the amount, the date, and what you're asking for.
Assume a reason before assuming a mistake: a short payment may be a deduction the customer thinks is agreed. Ask for the reason, or for the rest.
Use only the numbers from your documents, so there's nothing to argue about.
Keep a record of each ask and its answer, so the next person knows where it stands.
Decide on purpose what to let go, and write down why, so it isn't flagged again.

How thruflow does it

Recover does this every night. It finds each of the seven leaks in your own books, with the evidence, and drafts the email asking for the money (written with AI when it's on, and checked against the facts before you see it). A person reads it and sends it. Set aside what you let go on purpose, and Recover counts what was billed, collected or corrected after it flagged it.

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Questions

Is revenue leakage the same as bad debt?: No. Bad debt is money billed to a customer who can't or won't pay. Leakage is mostly money that's never billed, or a small part of an invoice nobody follows up, from customers who would pay if asked.
How often should we check for revenue leakage?: Weekly at least. Most leaks get harder to recover the older they are: a customer remembers a short payment from last week, not from last year.
Should we chase every small difference?: No. Set a floor below which a difference is noise (bank fees on a wire, a few cents of rounding) and write those off under a small-balance limit. Chase what's worth a person's time.