You can say one thing for KingsBridge’s old expense
management system: Storing receipts in a shoebox certainly is simple. That’s a
strong selling point for small companies like KingsBridge, a disaster recovery
and business-continuity services provider. But automation has its benefits,
too, and both corporations and suppliers are eyeing the opportunities.
Businesses large and small seek efficient processes that
will enhance compliance and data capture. Yet, small and midsize enterprises
face different obstacles, according to a PayStream Advisors survey of 200
people conducted in the fourth quarter of 2014 and first quarter of 2015.
Among respondents from large organizations (defined by
PayStream as having revenue above $2 billion), 43 percent said their top
struggle is an increase in expenses, and 41 percent claimed an inability to
enforce corporate travel policies. Reps from SME companies (revenue below $250
million), though, emphasized lower-to-the-ground issues. Just over half cited
manual data entry and inefficient processes, and 35 percent called lack of
visibility into spend their biggest problem.
Automated travel and expense management solutions have
improved survey respondents’ ability to enforce policies and see spend, lowered
processing costs, raised employee satisfaction and accelerated reimbursement.
Yet, some companies resist change. “Many believe that current processes work,”
the report stated. “While this may be true, it does not mean that current
processes work well.
KingsBridge, for one, recognized it was time to move on.
Three consultants from the seven-employee shop travel half the year each. They
spent $300,000 on air, lodging and car rental last year, stuffing their
receipts into a shoebox and filing expenses into a different Excel spreadsheet
for each client. “The amount of time spent individually wasn’t a massive
amount,” said KingsBridge co-owner Skip Williams, who’s also one of the three
frequent travelers. “When you really don’t want to do this and don’t know if
you’ve missed a receipt, you’re not really all that concerned about it.”
The benefits of that front-end simplicity would wash away,
however, when the accountant reconciled the books. Three to four months after
the travelers had filed expense reports, she’d ask for missing receipts and
explanations for expenses. Employees spent more time looking for receipts than
they would have upfront and often couldn’t remember the purpose for an expense.
“It was getting to be really difficult,” Williams said. “The
thing that really motivated us to find a solution that would allow us to track
expenses a bit better is that last year we had [about] $65,000 of unknown
expenses.” Anything above $10,000 makes filing federal taxes tricky, he said.
Payment and expense suppliers are responding to SMEs’ needs.
In February, U.S. Bank reorganized its operations to establish a team to serve
the middle market, said U.S. Bank head of middle-market product management
Bradley Matthews. As companies graduate from the small to the middle market,
U.S. Bank wants to have “the right tools and capabilities in place to serve
those needs,” he said.
“Large market customers have enough negotiating power that
they can pick and choose the services they need and negotiate as a stand-alone
company,” he explained. “As [small companies] grow into the middle-market
space, sometimes they don’t know all the services they need or where best to
get them, so there’s an opportunity for us to provide some consultation and
bring in new partners to help solve various needs for them.”
Last year, U.S. Bank also extended its FlexPerks Rewards
program to commercial card clients, allowing them to pool points not just for
individual employees but also at the corporate level. BMO in January allowed
Diners Club International clients to pool points for company use, and Amex
launched a similar program for small businesses in 2013.
Williams came across T&E management solution Trippeo in
December 2014. The system, which officially launched in January, automatically
imports credit card charges into reports, and the mobile app allows users to photograph receipts and link them to relevant
charges. He tried the solution for a month before implementing it fully in
March.
“It was a godsend,” he said of the solution. He liked that
Trippeo, like KingsBridge, is a small business based in Canada, which eases
KingsBridge’s dealings in both Canadian and U.S. dollars. “The hardest part [of
our expense management] is that we deal with cross currencies, and that’s a
humongous pain in the butt,” Williams explained. Williams and Trippeo now are
working on a feature to allow KingsBridge to run client-specific expense
reports.
This report originally appeared in the June 1, 2015, issue of Business Travel News.