Around 65% of entrepreneurs will admit that they don't think they had enough money when they started their business.
Want to learn a cold, hard truth?
Even if your business becomes a success, you never stop worrying about money.
As you grow, figuring out how to
control spending habits of your employees will be a concern. That's where spend
management can help. It's a philosophy that encourages companies to track
business spending so that it is as efficient as possible.
This guide will show you how to use
the spend management system to overhaul your business's finances for the
better!
Keep
Detailed and Accurate Records
You cannot revamp your company's
spending habits if you don't know what they are. Sit down with your finance
team and/or software to figure out your annual spending. Split your outgoings
into groups and create pie charts so you have visual data you can understand.
These groups might look something
like this:
- Employee salaries
- Office rent and utilities
- Advertising and marketing
- Supplies
- Insurance
- Training
Learning how to control spending
habits isn't only about cutting costs. You may realize after your analysis
that you need to spend more money in certain categories. But
now you can see exactly where you are spending most of your money and can take
steps to adjust it.
Use
Physical and Virtual Expense Cards
The era of the "company credit
card" and "expense report" is dead. These leave too much room
for human error and fraud.
Instead, opt for expense cards.
These are a type of physical business card where you can set limits for each
employee and since they aren't using petty cash, they won't need to submit a
report.
Virtual cards are also great for
subscriptions and online payments. There are lots of options, so check
out company cards to see which are best for your
business.
Switch
to Digital Receipt Collection
Your employees may have to use their
own money or petty cash in an emergency. In these instances, they will need to
submit a receipt to receive their expense.
Ask them to take photos of their
receipts instead of submitting the paper copy. This will reduce the chances of
them losing the receipt and your finance team will likely prefer storing
digital copies.
Choose
Software the Entire Company Can Use
One of the main reasons why spending
habits are so hard to control is because only your finance department knows
what they are. You should switch to a spend management software your entire
company can use.
This will allow managers to set
budgets for their team members. They will be able to see in real-time how much
money is going where. This will avoid projects going over budget or cash
sitting around in a pot and not helping the growth of your business.
That's
How To Control Spending Habits in Your Business
Figuring out how to control spending
habits in your company is simpler than you think. As long as you keep up to
date on where the money is going and keep streamlining processes, you will find
a good solution.
Running a business means you need to
have a versatile skill-set and always be learning. Browse our business section
for tons more informative articles!
