Expense Management Tips for Small Business Owners

When you’re running a business, staying on top of your spending can be critical. When your expenses come in many different shapes and sizes, however, this can be difficult. If you are buying paperclips for your home office, buying lunch for clients, and then refuelling the car on the way home, then it can be very difficult to distinguish between a personal expense and a business one.

This picture becomes even more complex when you’re trying to get many different employees to log their expenses accurately.

So, what’s the solution?

Setting Up an Expense Management System

Modern businesses have access to generalised software to deal with databases and spreadsheets. But these can be cumbersome to use, especially for people with limited technical knowledge, who’d simply like to log an expense quickly and accurately.

A specialised expense management system will provide a range of modern tools that will make it much easier to get an overview of the business’s expenses. These might involve tracking, categorisation, and highlighting problem areas. The information you can glean in this way can help you to make faster, better, more informed decisions.

Utilising Technology for Better Expense Oversight

Other technologies might be similarly useful in the battle for control of your expenses. These include prepaid business cards, which will not only help you to log the spending, but limit it ahead of time. When your staff know that they only have £50 to spend on a given day, they may be less inclined toward recklessness.

Planning and Budgeting for Predictable and Unexpected Expenses

For your finances to be resilient, you’ll need to have cash available to deal with sudden, unexpected costs. This means devising the right budget, which includes some cash set aside for special contingencies. The technologies we’ve discussed should help you control your finances, but they’re not a substitute for frugal planning.

Best Practices for Expense Accountability Among Staff

Keeping your expenses under control often means creating a culture of accountability. Staff should know exactly what the guidelines are, and what the consequences will be for those who fail to respect them. These guidelines, ideally, should be set in a transparent way, so that everyone understands not just what the limits are, by why they are set at that level.

You can devise your approach to expenses through consultation with your team, and through regular reviews. That way, you’re more likely to get everyone to buy into the strategy, and you’re less likely to run into problems.