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  • Writer's pictureArizona Contractor & Community

Using Credit Cards to Optimize Construction Spending

By Matt Butler

In the construction industry, work in the field drives decision-making.

When it comes to purchasing power, employees often rely on various types of credit cards. For example, if a field worker usually has to purchase from Home Depot, they would get a Home Depot card. Many also get a travel and expense card, fuel card, and maybe a multi-purpose corporate card. Some workers may even charge company spending to their personal card and submit an invoice for reimbursement.

Matt Butler

Paying with a credit card is the fastest and most efficient way for field workers to meet immediate needs. It is an excellent alternative to a contracting or purchase order process, which are cumbersome.

In reality, what happens on the back end is anything but fast and efficient. Instead, the accounts payable team runs many disjointed, semi-manual processes. That creates challenges around data accuracy, visibility, and control. It can also result in delays in reporting and job costing. That, in turn, leads to delays in billing clients and challenges with cost control.

Today’s financial technology, or “fintech,” offers clients streamlined, standardized, automated solutions that make both the front and back-end processes around credit card spending much more efficient. They let accounts payable and finance teams enable field spending without creating a tangled mess for themselves to manage.

Today’s Clunky Payments

What typically happens is that cards are issued upon request to meet different needs. Accounts payable teams end up managing a handful of card programs. They have to track down all the receipts for each–an ongoing challenge when you’ve got people all over the place and reconciling the statements. Each card provider may have a different reporting mechanism, such as a PDF or a CSV file, which requires several reconciliation processes.

Then they have to do all the job costing so the bills can go out to clients, accurately code all that information, assign it to the right project, and then input it into the general ledger in the enterprise resource planning (ERP) system. Since there’s no standardized reporting, there's probably an Excel sheet or two they must maintain to label and categorize the data correctly. They also have to keep track of hundreds of outstanding plastic cards. It’s an administrative nightmare–not to mention a fraud risk–as employees churn and cards get lost or stolen and must be replaced.

Construction companies also have seasonal or temp workers who need spending capabilities but typically wouldn't receive a company credit card given their temporary status. That means they’re also handling a reimbursement process for field expenses.

To read the rest of this article, you are invited to purchase the digital issue here.

This article originally appeared in the bimonthly Arizona Contractor & Community magazine, May/Jun 2023 issue, Vol. 12, No. 3.


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