Forward thinking business leaders are critically analysing the best ways to track their business expenses. They understand that the financial management of the company is essential and that smart expense tracking will not only result in increased savings – it will also result in increased profits when the savings are redirected to revenue generating activities.
The best way to track your business expenses is by using expense management software with automation capabilities that can track against business outcomes such as opportunities, customers, and campaigns. This approach will provide three major benefits:
The best software will store all of your key data and keep your expenses organised, using that data to provide real-time reporting and analysis and to capture critical tax and compliance data seamlessly. Businesses that don’t use software will often manually keep track of their receipts and input their trips and expenses into a spreadsheet which can be result in frustration for the employees who have to track the data, slow repayment times and limited visibility for Finance teams.
As an employer, you need reporting and analytics that help you maintain visibility of expenses costs in the context of the activities they support. For example, an intelligent expense management system, will allow you to assign expenses to a customer account, opportunity or marketing project and see exactly what it’s costing to deliver leads and sales. Controlling costs is only one part of effective expenses management. If a policy is too strict and limited, it might constrain business travel for sales and customer-facing activities, which are essential for revenue growth. Fixed limits might work well for lower value items, but for business travel and entertaining, it’s more important that expenses deliver ROI. Your policy needs to encourage employees to choose the best value options that enable them to do their work effectively – expenses management software built around your policy will help you to maintain it.
When you drive travel decisions using customer and revenue data, you empower your employees to spend what’s needed to generate revenue and profit for the company. One way of doing this is to set a budget depending on the forecasted revenue of the business trip. For example, sales representatives might be given 10% of the total value of their sales opportunity for travel and expenses. They know the deal needs to be profitable, so this will encourage behaviours where they spend money as if it is their own.
Ultimately, by leveraging expense management software that allows you to collect and analyse the most critical data from the business, align it to key business goals and draw the connection between a software that manages expenses and policies and the profit and ROI that comes from data-driven decision-making as a result of the software.
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