Visibility into your lawn or landscape company’s expenses is vital to ensure bad actors are not abusing your operations.
For instance, fuel cards are historically hard to track as different employees might be using different cards or sharing pins when they need to fill up at the pump. An employee could easily use this lack of oversight to fill up their personal car or fuel cans for their private use.
“There’s a lot of manual processes that can slow down your team and lead you to mistrust a lot of the people that you employ on your team,” says Daniel Simon, founder and CEO of Coast.
As an owner, you don’t have time to do manual spot checks of your fleet’s odometers to see if the miles per gallon make sense based on the fuel receipts. Thankfully, there is a new generation of software that helps reduce this friction and provides the insights your business needs far beyond your regular bank software.
“The cutting-edge technology in this new generation can give you powerful spending rules that can prevent waste and loss while empowering employees with easy-to-use tools that automatically categorize the transactions and easily capture receipts and memos,” Simon says.
Why Expense Management Matters
While most of your team members are ethical and loyal individuals who want to help you build your business, there are a handful of employees who come up with all sorts of ways to abuse trust. Simon says that more than 80% of the employees who admit to lying on expense reports don’t get caught. This type of fraud is extremely common in the field service industries.
Fraud and expense abuse by employees can cost companies up to 5% of their annual revenue, according to the Report to the Nations.
“With quality data and automated processes that are powered by software and technology, businesses can focus on growing top-line revenue rather than worry about those inefficiencies that eat into those profits,” Simon says.
He says that, on average, customers who switch to Coast are spending 10% less on fuel expenses.
Simon says by implementing better expense control methods, you can also strengthen your relationships with good employees and cut off the bad apples before they become wasteful for the business.
“If you have good expense control, then the benefits of it mean that the employees that you have are going to spend more time on the work that contributes to the profit of the business, being out in the field and actually doing work for your customers, rather than a lot of administrative work,” Simon says.
You may have concerns that implementing expense management software will come across as an expression of mistrust. However, Simon says it typically makes employees much happier due to the streamlined nature of the technology.
“The experience in the incumbent market has been about this need to enter in a whole bunch of information on the little dial pad that’s on the automated fuel dispenser on the gas pump when you use a fuel card,” Simon says. “What’s your pin? What’s your VIN? What’s the odometer reading? What’s the employee ID?”
Employees enjoy the ease of use the newer technology provides because they are not limited to specific gas stations where the fuel card can be used.
“Visibility leaves very little room for mistrust,” Simon says. “It allows the honest people in the business to focus on doing their jobs without having to be questioned. Their managers know they’re doing right by the business. We think our product is a way to increase trust and reduce suspicion between the landscapers themselves and their employees.”
Expense Management Software Features
Taking advantage of this next generation of expense software can allow you to set controls specific to merchant categories.
For instance, there may be some staff members you only ever want to allow to buy gas, while others may need to be able to make purchases at the closest landscape supply store for a particular job.
“You need to have those kinds of policies to say you can spend this much this many times per day, per week, per month in this category or that category,” Simon says. “To have that control in a single platform is an incredibly important thing to do.”
One feature Coast offers is employees can text their supervisor and request an exception to these policies if there is an instance where they need to purchase something out of the norm or above the set dollar amount. This provides an audit trail that is easier to manage versus a system of cumbersome receipts and reimbursements.
Simon says with these newer systems you can also make sure that the expenses line up with the other data you have.
“For instance, if someone is trying to make a purchase that they say is for windshield wiper fluid, but you have a GPS reading in real time that says ‘Hey, you’re making a purchase for a vehicle that you’re supposedly driving at the moment, but the vehicle GPS says that you’re miles away,’” Simon says. “We should either flag or decline that. That seems wrong.”
Another example would be if an employee is trying to purchase 25 gallons of gas, but the fuel gauge reading for that truck shows it only has the capacity for five additional gallons.
“We really focus on giving back control, security, visibility and reporting for these landscaping company employers and managers to make sure that they can just focus on the bottom line,” Simon says.
This type of software can also be used to track expenses such as parking fees, car washes, tolls, as well as back office expenses like money spent on Facebook ads or office supplies.
“You’ll get the same reporting and visibility that you love for those field expenses, but you’ll have a single pane of glass to view all the cardable operating expenses for your business,” Simon says.