As a business owner, you know that out-of-control costs are a major detriment to your success. You can’t gain and maintain a competitive edge with unchecked employee spending. In fact, many businesses state that controlling costs is a top priority. In addition, any form of business growth requires available cash to invest in growth opportunities. Therefore, employee spending management is vital to business success. Consider these benefits of business credit card programs.
Benefits of Credit Card Programs
Business credit card programs make it easy for employees to separate their personal and business expenses. They no longer have to requisition money or pursue repayment for company expenses. These programs also promote transparency in employee spending. You know how much your employees spend and where they are spending because you receive a report and analysis of their spending directly from the credit card company.
In addition, you may gain supplier or vendor discounts, such as airline points, lodging, and car rentals. Because your transactions are easily tracked, you can immediately track fraudulent purchases. You can then dispute these transactions immediately. With regular audits based on your spending reports and the credit card reports you receive, you can quickly identify expense irregularities and fraudulent transactions.
Create Spending Policies
Businesses need spending policies and guidelines. As a business owner, you need to be specific about what qualifies as a business expense. When you give your employees business credit cards, the transparency they offer allows you to correct your employees’ poor spending habits and identify any areas where they need clearer guidelines. However, give your employees the freedom they need to make the purchases they need to do their jobs efficiently.
Establish Card Controls
Before you give one card out to an employee, you need to establish controls. For example, you may limit spending to specific vendors and block cash withdrawals. You can also set transaction or daily credit limits. Most card companies allow you to customize your program to promote greater expense management.
Take Advantage of Technology
Don’t choose a card program based solely on rates or because they come from your bank. Choose the programs that offer advanced technologies. For example, you want the best fraud protection features you can find. In addition, you can receive daily, weekly, or monthly expense reports and spending analyses. You can not only watch how many transactions and how much money is spent each day on a card, but you can track who is spending this money.
As your business grows, your cost management procedures will become more important. Therefore, continually review your credit card program benefits to determine whether they still work for your company.