It’s commonly understood that employee productivity is essential to the profitability of businesses.
A joint report released by the Australian Productivity Commission and New Zealand Productivity Commission on how to maximise the opportunities for SMEs in the digital economy, found that productivity is increased when businesses adopt digital tools, such as cloud computing and analytics.
“To realise productivity gains from investments in digital technology, firms and governments need to make complementary investments in skills and process improvements.” [i]
With the right credit card or charge card for your business, you may have access to tools that can help streamline the processes of managing spending and cash flow cycles, while keeping a watchful eye the balance sheet.
What is business spend management software?
Put simply, spend management software is any tool dedicated to helping your business manage employee expenses quickly and conveniently.
This can run the full range, from simple receipt scanning tools through to credit facilities linked to accounting software.
Despite these new expense management tools, businesses still rely on a handful of techniques to take care of company spending:
- Petty cash: Lots of companies keep a box full of loose cash and coins on hand. And no-one every truly knows how much is in there or what the rules are.
- Company credit cards: Despite the risk of fraud, the lack of accountability, and the delayed oversight of spending, a lot of businesses still can’t seem to kick the habit with this one.
- Expense claims: Rounding off this unholy trinity is the dreaded expense claim. Here, employees pay business expenses out of their own pockets, hold on to the receipts, fill out a claim form, and waited ages to be reimbursed.
Fortunately, managing expenses no longer has to be quite so painful.
Now, there are better ways for businesses to pay for things, and employees can manage their expenses conveniently, securely, and quickly.
But what makes good spend management software, exactly?
What makes a good spend management software?
When it comes to spend management, not all software is created equal.
No matter how big your operations are, you need a solution that offers:
- Real-time expense tracking: You don’t want to have to wait until the end of the month to find out how much you’ve spent. Instead, find a solution that tracks expenses in real-time, providing a reliable snapshot of employee spending.
- A quick and simple overview: If you can’t do basic spend analysis at a single glance, something’s not right. Good spend management software presents expense information in a clear, compelling way, putting you in control.
- Customizable payment options: Not every employee needs access to the same funds. Your software should let you choose the amount available to each person, and what they can spend it on.
- Easy document capture: Businesses spend a lot of time storing and processing documents like invoices, receipts and purchase orders. A good software solution helps you capture and store these documents quickly and conveniently.
- Time-saving automation: The most significant downside to traditional expense management is that it takes up so much time. A great spend management platorm can free you up to focus on better - and more fun - things.
This might seem like a lot, but it boils down to a simple idea: find a solution that gives you and your team a quick, secure and convenient procure to pay process.
Proactively Manage Your Spending
Finding the right tool to help you get on top of your spending may help streamline the reconciliation of expenses and especially if your employees are travelling frequently and incurring a range of different expenses, such as meals, taxis and accommodation.
Issuing employee business cards that are linked to a central account may help reduce reimbursements for out-of-pocket expenses.
Business spending tools can offer:
- Shareable custom expense reports
- Detailed transaction reporting
- Spending limits and alerts (on an employee basis)
- Automatic alerts for unusual transactions
- Accounting software integration
Keep Cash Flowing
Managing cash flow cycles effectively and efficiently is essential for businesses to thrive. Having access to ready cash for when you need it could mean being able to take advantage of opportunities to grow your business or to invest in innovation and infrastructure.
Cash flow management is more complex than ensuring you have sufficient funds to cover outgoings.
There is a range of cash flow tools available that offer forecasting features, which can help guide your business planning and drive efficiency by integrating with your accounting software.
Further efficiencies can be found with business cards that offer virtual payment solutions to pay suppliers that don’t accept card payments. Some virtual payment solutions may help reduce manual payments with automated payment features.
Save Time with Software Integration
Expense reconciliation can be manual and very time consuming. Research conducted by MYOB shows that integrating business credit card feeds that automatically import and match financial transactions into cloud accounting software may save business owners an average of 10 hours per month.
Over a year, this represents an expensive overhead for your business, so finding ways to streamline, automate and simplify your financial management can free up more time for you to grow your business.
Leveraging business tools can help streamline your processes, saving you time and money. Once you’ve investigated which tools may benefit your business and decided which features you need, you might then confirm that your card provider offers complimentary features that integrate into your systems.
[i] Source: Australian Productivity Commission and New Zealand Productivity Commission 2019, Growing the digital economy in Australia and New Zealand. Maximising opportunities for SMEs.