As a business owner, there are some small mistakes that your business probably ignores yet they silently eat into its bottom line. If you operate a company that demands lots of regular traveling, then travel expenses likely take a good chunk of your resources. Any laxity or carelessness in tracking these business expenses may consume time, money and energy.
A proper mileage reimbursement program can, however, be the savior and help repay the lost resources. However, there are some pitfalls to avoid when implementing a mileage reimbursement program for your company – here are some of the most common mistakes which you’ll want to be sure to avoid.
1. Failing to have a clear policy or process
Almost half of all businesses who have mobile employees don’t have a mileage reimbursement program. Others do use a mileage log while some just pay without using any form of evidence, just to please their employees.
If a business can come up with a clearly-defined policy, everything will go on smoothly. Also, it will save money by paying the right amount of the correct mileage. In the end, employees will prefer to work harder and enhance productivity, and the business will strive to keep their financial records.
Important: a business can only execute a clearly-defined process and policy if it has the right instruments at its disposal.
2. Settling for manual reporting
Many businesses bizarrely rely on manual expense reporting without questioning the records. They, thus, squander a lot in mileage reimbursement naively. It’s easy for the employees to produce a receipt for everyday expenses. But when it comes to mileage, the business will just issue the payment without even asking the employee to present a photo of the distance.
Handwritten mileage logs or spreadsheet records aren’t ideal either. Dishonest employees will simply doctor the records and walk away happily. So, if your company relies on manual logs, maybe it’s time the management team gets up and realizes that there’s are several better alternatives.
3. Choosing a wrong alternative solution
It’s clear that drawing up figures from a manual report doesn’t work. It’s a pure waste of time and money and abuses compliance issues. Technology-based solutions seem to be the go-to alternatives for mileage reimbursements and rightly so because they’re perfect in reporting the figures.
However, a wrong choice isn’t any way better than a false choice. Tracking mileage can be a lengthy and complicated procedure, and it can be hard to tell when the findings are wrong. So, when choosing the correct choice of tracking tool, let it be centered on saving money, increasing yield and enabling obedience. It’s as simple as that!
