For companies that are in the transportation and delivery industry, managing their transportation-related expenses is crucial. Transportation expense management includes all of the different processes that these types of businesses have in place to track and control their expenses.
The transportation and delivery sector is projected to grow by 5 percent each year through 2025. With an increasing number of people turning to online shopping, these types of businesses should continue to experience strong growth.
Without good management practices, the expenses can balloon because of fraud, abuse, and waste. These issues can be easily fixed when businesses distribute transportation debit cards to their employees to use for business expenses.
Without good transportation expense policies and procedures in place, businesses are likelier to fail. Fundera reports that 25 percent of companies in the transportation industry fail within the first year while 60 percent fail within the first five years. One of the reasons why businesses in the sector fail is poor management practices.
Transportation expense management can include several methods. Businesses might give their employees credit cards to use to pay for business expenses. Others may have petty cash funds, ask their employees to pay for their expenses and to submit expense reports for reimbursement, or ask their employees to submit requisition forms and to wait for approvals before checks are issued. None of these traditional methods are optimal because they are subject to fraud and abuse.
The best choice for strong transportation expense management practices is to implement transportation expense policies that are clearly defined and to issue transportation debit cards to employees.
An employee expense card for delivery expenses can have restrictions placed on it to limit where it can be used, the purchases that the employees can make, and when it will work. The companies can also turn individual cards on or off remotely if a problem is identified.
A transportation debit card is a specialized type of business debit card that is designed for companies that have high travel expenses. These cards are used by a variety of different types of employees within the transportation and delivery sector, including the following:
The cards are useful because they can be used to pay for travel-related costs such as gasoline. Installers and repair people might also use their cards to make purchases of needed supplies and to purchase lodging and food at the allowed daily rate when they are on the road. The companies can set limits on the cards by the day and restrict the cards to the types of purchases that the companies have authorized.
Transportation debit cards are better than cash, checks, credit cards, and reimbursement systems in multiple ways. Cash systems involve giving employees a certain amount of cash to use for their expenses each day. Check systems involve employees submitting requests for expenses and waiting for checks to be issued before the purchases can be made. Credit card systems involve giving employees credit cards to use for expenses, and reimbursement systems involve employees making purchases and then submitting reimbursement requests.
Cash systems are particularly problematic because businesses will not know how the money is being spent. Having cash around in the business also makes it likelier that employees might steal. Checks can take a long time to be issued, meaning that employees may have to wait for approvals before they can get the items that they need to perform their jobs.
Transportation business reimbursements are frequent targets of abuse. Employees may submit requests for personal purchases, claiming that they were made for the business. Credit cards may be used to make unauthorized purchases and may have few restrictions that can be placed on them. Transportation debit cards avoid all of these problems because they have built-in controls that allow companies to tightly control how their money can be spent.
Strong expense policies for transportation businesses are important. It is much simpler to adhere to an expense management policy with transportation debit cards because of the built-in controls.
In order to implement a transportation expense policy, businesses must offer training to educate their employees on how the system works and what the company’s expectations are. They can explain the purchases that are authorized and those that are not and tell them about the features of the cards so that the employees understand the expectations that their employers have.
An employee expense card for delivery companies can help with transportation expense management because of the powerful expense management features and controls. Businesses can limit how much can be spent by the day or the week and can turn the cards on or off remotely. They can also place limits on where the cards can be spent.
For example, a company can give a card to a package delivery driver to use while he or she transports packages along his or her route. The card can be limited to gasoline purchases at specific gas stations. If the employee tries to use the card at other places, the card will not work. The business owner can see the purchases that have been made and turn the card off if there are any issues.
Transportation cards can also help to eliminate reimbursement for transportation expenses. Instead of having to spend their own money and wait to be repaid, employees can simply use the cards that they have been given to make authorized purchases.
Tracking paper receipts can also be eliminated. Employees can use their smartphones to take pictures of the receipts, and the photographs can be imported automatically with the transaction data into the company’s accounting software.
A card API can be easily integrated into your company’s existing transportation software. This could allow you to do a lot of things for your business, including automating the creation of cards whenever they are needed.
There are many unique situations in which a card API can be useful. It is very flexible and simple to use. You can use an integrated API to generate the cards that you need within your proprietary software programs.
There are several common pitfalls of poor expense management, including the following:
Businesses need to make sure that their expense policies are clearly written and understandable. They should train their employees on their policies. Eliminating processes that are prone to delivery business fraud such as checks, cash, and reimbursements can also help. Transportation debit cards can solve many of these types of issues for businesses so that they can reduce their losses, gain control over the expenses that they have, and have better transportation expense management.
The Bento for Business Visa debit cards offer built-in controls to transportation and delivery businesses and can help to improve expense management for transportation companies. Business owners can set restrictions on each card according to the needs of each individual employee’s job.
Bento offers a free 60-day trial so that companies can see how the cards work in practice. You can also request a free personalized demo. Bento is a recognized leader in the payments space for businesses and has earned excellent reviews. To learn more about delivery business expense management with the cards, call 866.220.8455.
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