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To figure out if expense management solutions are right for you, it’s important to understand what they are, and what they do.
What is an expense management solution?
Expense management solutions come in several forms including software, hardware, and systems, so you can manage business expenses with less effort. Depending on the system, you can use it to log employee expenses, generate reports, or automate bookkeeping processes.
For a deeper dive into the expense management solutions on the market, check out our free guide.
How will expense management solutions impact my business?
In a world of increasing digitalisation, and automation, expense management is one of the fastest growing areas in business operations today. While expense management solutions are growing in use and popularity, but they’re not for everyone.
Virtually all expense management solutions come with costs, have at least one interface to learn, and take time to roll out. If implemented successfully they can help your business save time and money on processes like creating expense reports, track spending, reduce fraud, and allow you to reimburse employees faster.
Keep reading to learn the truth about expense management solutions, if they can save you money, and whether they’re right for you.
Expense management costs
One obvious disadvantage of expense solutions is the cost, whilst many expense management systems such as accountabl, Soldo, and Spendesk include a free trial, the price can be steep if you need a lot of expense cards or features.
The best way to understand how much expense solutions can cost is to assess your business needs and cross-reference your findings with the different options on the market.
How will they affect cash flow?
If you pick an integrated card solution, you might have issues with your cash flow position as employees will no longer be shouldering business expenses and waiting for re-imbursements.
Standard practice for many businesses is that they ask their staff to cover their expenses, keep their receipts, and other documents and then file expense claims every month. Workers often fail to register their spending, lose receipts, and forget to fill in their expense forms. In fact, according to a survey by Barclaycard, 48% of employees use their own money to cover business costs without reimbursement.
Making sure employees are reimbursed for their expenses, might seem counter intuitive, but it’s a great way to keep your staff happy and productive as they’ll spend less time worrying about money. Plus, if you apply for credit with accountabl, you can maintain a neutral cash flow position by borrowing money until transactions are authorised whilst enjoying the benefits of an integrated card solution.
How do expense solutions affect workers?
Expense management solutions can reduce admin and save your company time and money. They save finance workers from spending hours registering and calculating expenses and allow business owners to focus on other things.
Automatically tracking expenses and creating reports means that your finance team don’t have to chase for receipts and fill in incomplete expense reports. For example, Airco had a 90% increase in receipt capture using accountabl. Simply put, expense management systems can help businesses save on staff costs, relieve the burden on finance workers, and prevent unnecessary losses.
Can I achieve real-time data visibility?
Expense management solutions can allow your business to track overall spending and prevent waste with real-time spend visibility.
Most businesses have a good grasp of their operational costs but have less control of their discretionary costs. Expense solutions can help businesses solve or improve their spend controls when it comes to ad hoc expenses, procurer and supplier relations, subscriptions, and travel expenses. This is a common weak area, so expense management solutions have the potential to prevent significant losses for many companies.
Can expense management solutions reduce fraud?
One great benefit of expense management solutions is that they can help you to avoid credit card fraud, which damages businesses more than most people think.
Paper expense reports are too easy to fake. According to UK Finance, businesses lost £374.3 million in the first half of 2020 and expense fraud accounted for a significant proportion of total losses. Beyond that, the Global Payroll Association states that one tenth of UK employees admit to submitting erroneous expenses all the time and one fifth do so irregularly. This costs the UK economy around £2 billion a year. Switching to a more fool-proof expense system will help you to prevent fraud in your company by allowing you to track and approve expenses in real-time.
Expense management tools take time to rollout
Expense management systems can be intimidating, and a lot of managers and finance workers worry about rolling them out.
Popular expense management tools such as Pleo and Soldo allow you to pay extra for on-site training to help staff get to grips with the new system. Even if you cannot afford on-site training, some expense management packages such as accountabl provide complimentary training and live customer support as part of their basic packages.
There are also a few things that you can do to help workers get onboard. It helps if you set a switchover date, so that everyone stays focused on learning the new system and has time to get the help they need. Setting time aside to support staff who are struggling can also make the rollout easier.
Check our article on how to get your staff to use accountabl, for more tips on getting your workers on board.
Are expense management tools right for you?
They’re not for everyone, but most businesses will save money in the long run if they know what they need and implement expense solutions properly. For example, using accountabl, Allenby Commercial managed to reduce their bookkeeping administration costs by 80%. More generally, AMI-Partners found that on average small and midsize businesses saved $39,000 annually by automating their expense processes.
See how much you can save with a 30-day free trial of accountabl.
