A Guide to Travel Expense Control in Sales
Developing an effective sales travel expense policy is vital for companies that have a team of traveling sales representatives. However, it becomes much more critical when your top-line income is generated by them traveling across cities, states, and time zones.
If not correctly developed, your employee travel policy may actually limit your team’s desire or capacity to travel to close deals.
In today’s environment, businesses must collaborate with their human resources, sales, finance, and travel teams to develop a travel and reimbursement policy that not only your salespeople understand, but also which drives them to bring in revenue for your company when travelling.
In this article, you’ll learn why an effective sales travel expense policy is important, as well as how you can exercise travel expense control in sales.
Table of Contents
- What is a Sales Travel Expense Policy & Why is it Important?
- How to Develop an Effective Sales Travel Expense Policy
What is a Sales Travel Expense Policy & Why is it Important?
A sales travel expense policy outlines the responsibilities and duties of business travel in regard to expenses. It lays out a clear direction for salespeople to follow in order to maintain the validity of their costs. Additionally, it helps them use sound judgement when spending and reporting company expenses.
A travel and expense policy also identifies and describes the types of costs that an employee must report. It goes through each area in depth and explains how to track and report that specific company expense.
The sales team is often the department within a business with the largest budget for travel and leisure. They spend the most money on entertainment for prospects, suppliers, and existing customers. However, and most crucially, the sales team also contribute the most to top-line revenue.
With these two considerations in mind, it is clear that how a company develops and enforces an expense policy, as well as how it uses expense spend data, has a bigger influence on the sales team than any other department.
How to Develop an Effective Sales Travel Expense Policy
Now that you understand the link between an effective sales travel expense policy and a successful sales team, it’s vital to develop a policy that allows them to thrive.
Here are three key ways you can ensure your sales reps spend time closing deals, rather than worrying about their expenses.
1. Remove Tedious Expense Reporting Processes
Your sales team should be freed up to focus on doing what they were hired for, rather than spending hours on tedious admin tasks relating to their travel expenses.
This is where expense management software comes into play. It automates duties such as filling out laborious company expense reports, compiling paper receipts from months ago, and determining who should be given an expense reimbursement during critical rapport-building activities such as prospect lunches, dinners, or events.
Software such as ExpenseIn even comes with a receipt scanning feature, which allows users to simply photograph a receipt before the software automatically extracts all of the important information. This method takes just seconds, as opposed to hours. As a result, salespeople have more time to spend nurturing leads and closing strong deals.
2. Utilise Automated Spend Controls and Monitor Transactions as They Happen
Traditional corporate credit cards and travel expenditure reports have a drawback in that the data is usually delayed, often by up to a month. That’s a long time for any finance executive looking to increase policy compliance and prevent out-of-policy expenditure! Over the course of a month, a salesperson who doesn’t adhere to your expense guidelines could accumulate a mountain of employee spending.
This is why ExpenseIn has features such as Real-Time Reporting. This also enables finance departments to make decisions based on up-to-date data and trends.
Additionally, the Automated Policies feature allows organisations to configure guidelines that regulate expense claims. From limiting the maximum claim value to adjusting the requirements for the presence of a receipt, it’s easy to configure rules and apply them to groups within your business.
Receipt verification flags up any amount, date, or VAT discrepancies automatically, meaning managers no longer need to check receipts against every expense claim. Furthermore, automated policy checks cut down on expense rejections. This not only reduces manager workload and reimbursement time for employees, but also gives salespeople more peace of mind when they get confirmation of a successful expense submission.
3. Deter Out-of-Policy Spending
Many salespeople have become accustomed to using their personal credit card for business travel expenses in order to maximise personal reward points. These points are non-transferable, difficult to track, and have no monetary worth. Additionally, they act as a reward for spending as much as possible—the exact habit that your sales travel expense policy is trying to control.
If the maximum authorised total price for meals or other entertainment charges is £30, your workers will slash that to a penny below the limit. This isn’t the fault of your team. Personal cards are to blame for incentivising irresponsible spending.
Instead, you can provide a replacement bonus—in the form of money—that your salespeople will value far more than personal card points. This will deter out-of-policy spending and save your finance department numerous headaches in the process.