Threshold tracking is the practice of continuously monitoring how close a contract's actual performance is to triggering a rebate tier, growth bonus, or economic clause. It allows buyers and sellers to act before an economically meaningful threshold is missed.
What threshold tracking measures
The metrics are typically: current spend (or volume) against each contractual threshold, the remaining spend required to cross, the earned rebate at current tier, and the incremental rebate that crossing the threshold would unlock. The measurement runs continuously against ERP data.
Why threshold tracking matters
Without threshold tracking, tier crossings become discovered rather than driven. Continuous tracking lets procurement or commercial teams make consolidation decisions in time to capture the value - accelerating a purchase, adding an entity to a master agreement, or renegotiating a mix.
