How to solve the most common business expense problems
Paying for expenses is an everyday reality for businesses and their employees. Whether they are covering travel costs to meet with clients, for picking up supplies or carrying out essential work on location, these payments can cause significant headaches for business owners of all shapes and sizes.
At Allstar, we recently spoke with?1, 000 UK SMEs. One of the key findings that the study revealed was the growing pressure that business leaders were feeling over the handling of expenses.
A disproportionate number of hours are being spent by owners on managing expenses every week, which is lost time that could be better spent on growing the business or even improving their work/life balance.
The results also highlighted that, for many, dealing with paper receipts and out-of-date processes creates a huge admin burden and reduces productivity.
Three common issues for SMEs
There are three main headaches that businesses face with their employees:
Many managers are concerned about employees spending more than they need to when away on business, due to the impact on a business’s cash flow and profit margin.
For workers that are spending too much on their expenses, it is essential that the business has a clear approach to expenditure. In doing so, it can better educate employees on suitable spending boundaries, safeguarding company finances.
Moreover, it can help ensure employees don’t feel left out of pocket when they come to submit their expenses.
2. Lost records
Mislaid receipts are a common issue for those that operate under the pay and reclaim? expenses system. Many workers worry about losing their bills and, with them, any prospect of being reimbursed in full.
Additionally, by not keeping and submitting receipts, businesses can be hampered or prevented from making an HMRC claim to get VAT refunded.
3. Overwhelming paperwork
Expense claim submission processes are often longwinded with a large paper trail, which means an expense build-up for both the employer and the employee.
Failure to simplify can create issues for the business around reduced productivity and poor efficiency. Further, it has the potential to lead to employees moving on to a better managed and even fairer workplace.
Thore Vestergaard is the MD of Commercial Cards at Allstar Business Solutions. Previously, in a career spanning 25 years in the payments industry, Thore served in senior positions with industry leaders such as Mastercard, Citi and Visa. His focus has been on B2B payments, helping businesses modernise replacing inefficient payment methods with innovative, electronic alternatives. Innovation is also at the heart of his role at Allstar Business Solutions where he is on a quest to deliver more value to customers, be it SMEs or large corporates alike, through unique payment solutions that drive convenience, cost savings, greater transparency and better controls.