The Australian construction industry is booming and with this growth comes a rise of expense management problems as companies look to tackle their growing pile of paper receipts from each job they have going. These issues can arise from mileage, food or general job site costs where workers have paid out of pocket to keep things running smoothly while on location. This is where mobile tracking and cloud-based software can transform expense processes and save businesses time and money.
Powerhouse construction corporations such as BGC and ADCO have a large number of employees and one factor that can take away from company's revenue is a lack of mileage tracking for employees, especially in the construction industry where you are flying or driving from one site to the next. A recent study published in CPA Practice Advisor found that 52% of companies reported employees losing paper receipts.
Business expense tracking software optimises expense management and automates manual processes so these problems become a thing of the past. Here are three major benefits of using an expense management software for businesses in the construction industry.
The ATO reports that construction employees can file for work-related expense deductions but this is a long drawn out process that is linked to manual reporting and expense reimbursements slipping through the cracks due to paper receipts. Most construction professionals manually prepare reports, despite knowing it halves productivity.
The construction industry is one of the least digitized industries, says McKinsey Global Institute. Changing this paradigm with fintech is necessary for the construction industry to be able to compete in the modern world.
Expense management solutions streamline these processes to bring more transparency and efficiency to the process. For example, it’s not uncommon for a construction foreman to spend money from their pocket on materials during the construction process. When doing so, the foreman must then save paper receipts, track them on a spreadsheet, and submit these with expense claims to the owner or client.
With the product functionality of a smart receipts app, the receipts can be digitised using advanced OCR technology. They can then be submitted with the push of a button. This can even be done while in the field. There’s no more waiting, and no more lost receipts.
Using an expense report software can easily streamline construction operations, reduce inefficiencies, and raise revenues for the small businesses that use them.
Connecting crews in the field
KPMG research found 82% of owners lack collaboration with their contractors. With so many crews at so many remote sites, maintaining connectivity is imperative.
Expense management software here in Australia allows for the best tracking and options to go paperless with your receipts, enabling businesses with remote teams to have instant communication for financial transactions. This allows for increased productivity from employees, generating more income for employers.
This is why each site should be connected at all times so that site supervisors are held accountable for the production and quality of their respective teams. Business expense management software provides a simple process that won’t cause any delays or discrepancies between teams. By using expense software, a construction business will keep its crews working at their most optimised levels.
Leveraging mobile technology
According to KPMG’s Global Construction Survey, 77% of contractors and 65% of owners use mobile technology to complete construction and engineering projects. Other data shows that 36% of construction firms use 5 or more mobile business apps while working on projects.
However, KPMG’s survey also found that only 29% of firms routinely use apps on all their projects.
Mobile phones are now becoming increasingly available. Research shows over 19.4 million Aussies own smartphones. Leveraging these devices with an OCR-enabled smart receipts app can save a lot of headache down the road.
Even something as simple as corporate travel connected to the construction project can cause issues. Research from the Project Analysis Group found that 35% of all construction projects have a major change before being completed. Imagine that change happening while the foreman is traveling to a supplier for more materials. It could create expensive problems that must be corrected before moving on. Now the project is delayed, and the problems continue to pile on.
All of these issues could easily be prevented with the usage of mobile technology. Fintech is especially useful on mobile devices, from smart receipts apps to mobile payment apps, and even messenger programs that enable team collaboration across sites.
Automating manual processes
The Navigant Construction Forum reports that approximately 6% of total project cost is the median cost of rework. Automating manual processes is the key to eliminating this wasteful spending. PricewaterhouseCoopers’ Annual Manufacturing Report found that automation and data exchange are key factors cited by 80% of respondents as increasing productivity.
Expense management software for businesses automates one of the most manual processes in any organisation. Expense management rules are programmed into the system and automatically deny or approve expenditures on the fly and instantaneously. From there on, expense reports are automatically imported into accounting software like Xero, Sage, Jobpac and Pronto.
Using automated expense management solutions reduces the possible points of failure in your business processes, resulting in fewer errors.
The construction industry is growing, and technology is playing an increased role in it. By investing in the right expense software upfront, you’ll save time, money, and other resources for years to come. It’s easily the best decision you can make for your construction company.