Reducing Costs Through Business Credit Card Programs
Most businesses prioritize controlling costs. Reducing costs allows these companies to reinvest and expand. As a business owner, you are probably concerned with cost reductions and may be interested in ways to control employee costs, such as travel and entertainment expenses that you have to reimburse. Business credit card programs offer management ways to reduce employee costs.
Benefits of Business Card Programs
If you are interested in controlling your employees’ spending, you may consider acquiring business credit cards. These cards have limits and require authorization or approvals for use. They provide you with information about spending, so you can analyze and manage spending more effectively. In addition, established credit cards allow you to negotiate discounts with your suppliers, even airfare and lodging. These credit accounts also have better security than checks and ACH payments. You are can see the transactions and dispute any fraud immediately.
Your employees will appreciate business cards because they won’t have to wait for reimbursement for their business expenses. Instead, they can easily separate their business and personal expenses based on the cards they use.
Adopt Best Practices
If you plan to add business credit cards into your cost control structure, you should implement several best practices and share them with your employees. First, you should develop guidelines for your employees. They need to know what expenses are truly business-related and what expenses are considered personal. You can also implement controls on your cards. For example, you can block your employees from pulling cash from these accounts, authorize specific vendors and set transaction and monthly spending limits. Each employee can have a different limit as well.
Then, prioritize a review of all your company expenses. Carefully look over and analyze each cost to ensure it is appropriate. Find out who is making what purchases, where they are making them and how often they use company resources for these purchases. Review how your employees use the services they buy. Encourage your card-holding employees to review their transactions to see where they spend money and whether it is appropriate. Use this information to modify your card policies, making them more efficient.
Seek cards with fraud protection features. Your card should also have the latest technologies, such as expense report submission, back-end management and the provision of daily card transactions. You should even be able to approve transactions and upload them to your accounting system or general ledger.
Business credit cards and purchasing cards can help your company improve its expense management. However, do your research and choose the cards with the greatest benefits and most up-to-date technology.