Foreign business travel costs can be a large part of a business’ total expenses, and so it’s good for employers to regularly review processes for payments and good practice for expenses incurred abroad.
According to Allstar’s research with Censuswide, it reveals that small and medium businesses are spending up to 6 hours every week managing costs and cashflow – that’s from a survey of 500 SME (small-medium enterprise) business owners who revealed the business issues that plague them most.
In all businesses, time is of the essence and with foreign business travel a regular and large expense for many small and medium sized businesses, it’s important to minimise the amount of hours spent on expense management, whether that’s the business owner or someone else’s task.
Some employees travelling abroad may not be used to paying for products and services in foreign currency, or aware of how to claim expenses accurately they incurred in a different country, which makes it more challenging for expenses to be managed when they return. In this article, we look at some of the areas to look at so you control costs, avoid overpayment and make secure payments. Here are our top tips:
1 Avoid having to be a foreign exchange expert
Exchange rate fluctuations can cost your business. By the time employees get around to making a claim, exchange rates can shift and the cost to your business can increase, because they are calculating the cost in sterling at a different time.
Then there’s Dynamic Currency Conversion, where the merchant offers to process a card payment in either GBP or in the local currency. If you opt for GBP, the exchange rate will be set by the merchant and their provider, which can mean less favourable rates.
With Allstar Expense, the transaction is paid at the existing rate at the point of purchase, and set by Visa, rather than a local merchant whose rate could be far higher, with exchange rates being more transparent for the business and employee.
2 Be fee aware
Using cash to pay for expenses abroad is fraught with issues. Not only are fees usually charged for converting currency, and for taking cash out of a local ATM abroad (which also often come with less advantageous exchange rates too), you’re also likely to end up with notes and coins floating around that have to be accounted for, while the receipt trail isn’t always as clear with cash as it is with cards.
By selecting the right company credit card, you can ensure fees are kept to a minimum and where possible, you avoid using cash for payments.
3 Manage receipts digitally
Getting and keeping receipts while on foreign travel is not always easy, especially if employees then have to try and work out at a later date what they are for. When it’s all in a foreign language, different currency and laid out in alternative ways, it’s not always straight-forward to work out what the receipt was for. This can lead to confusion when reclaiming expenses.
It's easier for employees to upload images receipts through apps on their phone, which saves them having to bring lots of bits of paper home, and then try to make sense of it all. Not only does it automatically match with the transaction, but it also ensures any potential VAT could be reclaimed too.
4 Make secure payments
Employees paying for expenses at home are used to processes. They understand the price of things , and how readers and card machines work. But when they’re abroad, this isn’t always as clear cut: purchases, prices or currency rates can be displayed in other ways, and the way in which you pay for items can change too.
In order to put their, and your, minds at rest that payments are being processed in the right way, and that there is a process should something subsequently go awry, it’s best to use a card within an international payment network and with clear reporting.
5 Keep an eye on spending
When abroad, it can seem much more difficult to keep in touch with employees, and manage what they are spending. The concern is that left unchecked, they could unknowingly be overspending.
Online portals that show spend in real-time and in-built card controls for each user can ensure you have control and oversight, wherever your employees are.
6 Buy fuel abroad better
If your employees drive abroad, you need to be sure they have a fuel card that helps them wherever they are. In the UK, some businesses may have chosen a particular provider because the network here suits their operational purposes, but that might not be the case when they drive in other countries.
Instead, it pays to be using a card that has wide acceptance, which makes journeys less stressful, transactions will be reported back, as well as converted at a transparent and competitive exchange rate.
7 Find accommodation easier, and more cost effectively.
Accommodation is often a major expense with foreign travel and so managing booking and costs is important.
Allstar’s partnership with Roomex addresses these issues because it brings hotel bookings and payments into one platform, as well as offering more than 1.2 million hotels from 35 sources.
That means it can help employees to find the right type of accommodation at the right price, while employers can implement their own policies and controls, as well as getting spend analytics and booking histories.
All travel purchases such as food, parking and WIFI made through Roomex can be put on the Allstar Expense card at the point of booking, keeping control over spending.
8 Look after employees’ wellbeing
Travel can be an amazing experience, but it can also be stressful. That’s especially the case if employees are having to pay their own way for flights, hotels, transport, food and drink, and then claim it later.
Not only might it affect their own cashflow, but then they have the pressure of working out at a later date what to reclaim, and at what exchange rates.
As mentioned earlier, exchange rates can fluctuate, and so if they’re not aware of the rate at the point of purchase, it could result in them losing out if they use a different rate.
All of this could add to their stress, both mentally and financially, and make foreign business travel a challenge and a chore, rather than an exciting opportunity.
Allstar Expense
With the Allstar Expense business credit card you can make foreign business travel more financially efficient, more secure, controlled, and less stressful too. Our card offers the following benefits:
Monitor business expenditure and get detailed insight on costs with our online account management tool, Allstar Online.
Up to 44 days interest free**
Accepted worldwide wherever you see the Visa symbol
Security and anti-fraud controls to provide seamless and secure e-commerce.
Control spend type by card such as access to hotels, e-commerce and travel.
Create bespoke spend reports on every card.
*ExpenseIn is a separate product that can be added to support your Allstar Expense account. Applications are made directly with ExpenseIn and are subject to status.
**Subject to status and a full credit check. To be eligible for Allstar Expense, your company must be incorporated (e.g. a limited company)
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