When budgets are tight and businesses are looking to cut costs, travel and expenses (T&E) costs can be in the firing line. Yet, budget cuts in this area can affect business performance since T&E spending is often necessary. With a strategic and proactive approach, companies can save significant amounts on T&E spending without affecting employees’ ability to work effectively.
On average, the typical company spends 10% or more of its annual budget on business travel-related expenses and Asia–Pacific is the largest business travel region globally. However, despite T&E looking like a great place to save money, it can be one of the most difficult operating expenses to control.
This is because too many organisations rely on manually entered T&E data, which takes time and creates opportunities for error. A lack of visibility into exactly how much money is being spent on what and by whom makes it difficult to set and enforce spending policies effectively.
This is exacerbated by manual systems, since it’s difficult to import data from various systems into a single location for analysis. Also, when workforces know that tracking processes are manual and hard to manage, there is a propensity to spend outside of approved policies.
Automating T&E processes leads to greater visibility and control. It can also increase employee productivity by as much as 29%, with team members saving an average of 6.1 hours on travel planning and 4.1 hours on expense reporting every year. It can also make it easier for employees to access cheaper services via the sharing economy without resorting to out-of-policy spending.
To access these benefits and demonstrably reduce the cost of T&E spend, businesses need to implement automated, integrated, end-to-end travel and expense management systems. Further, using the T&E management system as a platform for integration with internal systems and third-party supplier data and applications, and as a platform to leverage the additional capabilities provided by cloud, mobile computing, and social networking, delivers even greater benefits.
There are six ways businesses can save with an automated, integrated T&E solution:
Stop overspending on errors.
A T&E system that automatically processes charges from suppliers and credit card companies can lower the risk of missed or incorrectly entered expenses. That kind of accuracy lets organisations get expense reports done faster and pay corporate bills sooner, leading to better control of cash flow.
Cut out management time.
Requesting travel, tracking receipts, and completing expense reports through a manual, outdated process can lengthen processing time and create administrative burdens for organisations. Businesses can get ahead by automating the entire T&E process to minimise both costs and demands on employees.
Take control of mobile phone spending.
Employees can quickly accumulate mobile roaming charges when travelling. Automation lets organisations use travel data to proactively identify trips that may incur roaming or additional mobile charges. This can help businesses adjust mobile plans before travellers leave so they can avoid hidden and expensive mobile costs.
Spot savings without increasing overhead.
Having the right tools in place can help businesses stop bad spending before it happens and mitigate fraud risks early in the process. This frees the finance team to focus on managing budget instead of process.
Harmonising vendor information from every source can give organisations visibility into spending with each hotel, airline and other travel provider. Not only does this ensure visibility into real-time spend, it also positions businesses to negotiate the best prices and save on accommodation or flights.
Reduce tax costs.
Employee travel has tax implications, from payroll tax to GST on international purchases. Targeted apps can help businesses address this type of spending and automatically track tax liabilities as well as GST expenses.