Spend Management

Changing The Conversation: From Spend Management To Margin Improvement

Bento for Business

The rise of the gig economy and the popularity of remote work are among the factors that are laying bare the need for better spend management systems and technology. The demand can be especially acute when it comes to the support of company field technicians, those vital workers who might not show up to the office for days or longer.

However, in a new PYMNTS interview, Bento for Business Co-Founder and CEO Farhan Ahmad talked about how the proper deployment of digital technology and data analysis can not only bring more efficiency to the spend management but bring a company closer together.

“Field technicians are almost always away from the office, and they need to pay for things when they are away,” he said, describing the daily challenge. Such purchases may involve fuel or supplies other items, but the more flexibility those field technicians have when it comes to payments, the more efficiently they can work — and the happier they might be as workers.

The issue of better spend management for those field technicians — essentially, a mobile workforce — ties into the much larger problem of cash flow for companies, especially challenging for many small- and medium-sized operations. A recent U.S. Bank study found that poor cash-flow management contributed to the failure of 82 percent of SMBs and that insufficient initial capital caused 79 percent of them to falter. Failure isn’t a rare problem, either, as a separate study determined that 49 percent of smaller enterprises fold within their first five years.

New Tools

New solutions and data services are enabling these companies to exert greater control over employee purchases, including how much each worker is allowed to spend and on what types of items. In addition, they can help businesses better inform their decisions by collecting data and offering insights into operational expenses.

The immediate goal is to move such spend management systems for field technicians away from their reliance on cash and checks. Ahmad told PYMNTS he is not among people who think cash or checks will ever disappear, but he said those forms are payments are often far too limiting for the needs of the modern mobile workforce. “Checks are very rigid,” he said. “You often write an amount upfront, and many places don’t accept checks.” Moreover, those acceptance rates keep on declining further as more places that are part of B2B transactions move to or upgrade their digital payment systems.

Not only that, but what can arguably be called old-fashioned spend-management systems for field technicians often create their own inefficiencies, he said. That’s because some field workers are required to come into the office every day to get their money available for spending. “That is very inefficient and expensive and demotivating,” Ahmad said.

In his view, three general trends are helping to drive more spend-management systems to more digital and more flexible systems when it comes to meeting the needs of those mobile workforces. “First, the shift toward a freelance economy (gig economy) is making the relationship between companies and workers a little more tenuous,” he said. That is encouraging the deployment of digital spend management systems.

As well, there is a decreased level of ownership in the B2B world — even Bento rents its servers from Amazon, he said by way of example. That, too, is promoting what one might call a more decentralized approach to business operations in general, including in the area of payments and spend management. The third trend is simply the growing use of digital payments in all areas of business life, which further encourage the move away from cash and checks for mobile workforce spend management. “Digital payments are bringing benefits that checks and cash do not provide,” Ahmad said.

Role of Data

Data analysis is key to the further spread of digital payments to spend management for field technicians, he said. That's because proper data analysis has significant predictive powers — always a good thing when it comes to cash flow and spending management. Also, the flexibility that digital payments offer in this area of business operations can build employee morale, he said, because getting away from cash-and-check-based spend limitation can show employees that they are trusted (these digital systems can offer up-to-the-minute transparency about spending, reducing the risk of theft). “A great way to build rapport with employees is to show that you trust them,” he said.

Spend management still has a long way to go before digital starts to dominate, but the steps are being taken, and you can expect more progress in the years to come.



The September 2020 Leveraging The Digital Banking Shift Study, PYMNTS examines consumers’ growing use of online and mobile tools to open and manage accounts as well as the factors that are paramount in building and maintaining trust in the current economic environment. The report is based on a survey of nearly 2,200 account-holding U.S. consumers.