Home » Finance » How businesses can save time and keep control while enabling smart financial decisions

Karen Ko

Senior Finance Director, Pleo

Businesses face increasing pressures in maintaining or maximising profitability. However, modern fintech can simplify time-consuming practices and provide greater visibility while saving money.

With economic instability over the last 12 months, it’s no longer enough to focus on short-term profitability and growth. Finance teams must engage in conversations with senior stakeholders earlier, insists Karen Ko, Senior Finance Director of business spend management solution, Pleo.

Their recent report, with insights from over 3,500 decision-makers across Europe, shows that 25% predict that inflation will have the most negative impact on operations. Another 24% expect it to be high energy bills and 22% think it will be the high cost of goods, materials and services.

Financial visibility with data and predictive analytics

With costs skyrocketing, decision-makers are expected to be better prepared. “Early in my career, there was less emphasis on forecasting and predictability. Now, because of the current landscape and a lot of unexpectedness in the last 12–18 months, finance teams are being asked to predict the future and do more scenario planning. We don’t just focus on growth but also downside scenarios — for example, what levers can we pull if we see market downturn?”

However, 53% of businesses in the UK say they don’t have strong visibility of financial health and performance. Businesses need quality data on where their costs are and where they make money in order to secure their path to profitability. With insights gathered from such data, they can engage in predictive analytics.

53% of businesses in the UK say they don’t have strong visibility of financial health and performance.

Real-time expense tracking in one place

Finance tools enabling full visibility will allow businesses to plan ahead — but 32% of UK businesses are overloaded with software and financial tools. In a single platform, Pleo’s spending solution includes subscription management, spend categorisation, invoice payments, email synching and direct reimbursement.

“With insights from operation teams, we can find out what projects are coming for us to provide better forecasts in our models. We also need good-quality data to provide analysis on the key drivers,” explains Ko. “This allows us to guide the management teams on where we need to invest, keep steady or dial back on investments.”  

Businesses can keep track of each expense in real time by giving their employees a Pleo debit card. In businesses that use it, 77% of admins report that they spend less than an hour a week on expenses. This is especially beneficial for those with small and stretched finance functions.

“When a business grows, finance function often doesn’t grow at the same speed. You want someone who can manage all expenses. This gives the business a clear view of how much they are spending on each category,” she adds.

Get full visibility over your company spending with less of the manual work. 

Control for finance decision-makers and employees

Ko highlights the importance of setting out clear budget guidelines. Teams and individuals must know they are accountable and trusted to handle their budget — and without tedious expense reports.

“Control comes from both sides. As a business owner, you can set limits for each individual. It gives them autonomy by saying, ‘This is what we have agreed you can spend to reach revenue targets.’ Employees see their limits on the app; there’s no ambiguity on what they can and can’t do — giving them the freedom to get on with their jobs,” explains Ko.

Employees can simply upload receipts onto the app without worrying about losing them. Finance teams can review real-time expenses to see if they’re going in the right place. “There’s no additional task or burden of paying out-of-pocket expenses,” she adds.

Start speaking to your finance teams

Looking forward, Ko hopes that employees will engage with finance teams more. “Finance is often seen as a back-office function. We want to encourage anyone to speak to their finance teams and know more about what we do because that’s the only way we can help each other.” By maximising financial tools, businesses can gain full visibility, have the capacity to plan for the future in economic uncertainty and delegate financial control to their valued employees.

Find more information on Pleo, please visit www.pleo.io/en

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