This article is sponsored by PEX Card.

If any industry is ripe for digital transformation, it’s construction. Deloitte notes: “Construction companies should continue to transform digitally and take advantage of emerging technologies, something that, due to tight margins, has only recently become top of mind for many CEOs.”

The construction industry is facing unprecedented challenges in 2024, with disrupted supply chains, delayed projects, and increased costs, while seismic shifts in both consumer and commercial often mean revenue volatility.

In this environment, it is essential for construction companies to increase productivity through technological solutions that have minimal learning curves and substantially reduce effort by both the workers on the jobsite and back-office finance teams.

One easy opportunity to vastly improve productivity is for construction companies to optimize their workforce spending and ensure that every dollar is used efficiently and effectively. However, this is easier said than done, as the industry must balance the competing needs of field workers, project managers, and finance departments.

Field workers need the flexibility to purchase materials, tools, and services on the spot, without long delays for approvals or reimbursements. Project managers need to monitor and manage the progress and budget of each project, ensuring that deadlines are met and costs are contained. Finance departments need to control, track, and report the spending of hundreds or thousands of corporate cards, ensuring compliance with policies and regulations. These needs often conflict with each other, creating friction and inefficiencies in the workflow.

The key solutions to these challenges is to leverage new technologies that can transform the way corporate cards are issued, used, and managed; provide real-time visibility, automation, and integration of the entire spending process; and empower field workers, project managers, and finance departments to work together seamlessly and achieve their goals.

Want to know how to set up the right corporate card program combined with a modern spend management solution? Or how construction companies streamline their workforce spending and enhance their operational efficiency?

These solutions provide the following benefits:

• Simplify and speed up card issuance and activation
• Customize and enforce spending rules and limits
• Capture and categorize receipts and transactions
• Integrate with accounting and project management software
• Generate and analyze spending reports and insights

And most important of all:

• Increase worker and back office productivity 15 times with 10 minutes of training

Construction industry field workers need a corporate card’s flexibility to keep projects on track. However, that very flexibility compromises the finance department’s need to control, monitor, and report spending.

Here’s how new technologies are solving that conundrum.

Why Corporate Cards Are Ripe For a Technology Makeover

No construction company today can function without corporate cards. If every tank of gas, can of paint, or repair had to go through procurement, then no job would ever be completed. The fact is, the more corporate cards you distribute, the more flexibly you can operate.

However, that flexibility comes at a price. Every time you give someone a corporate card, you lose control. No matter how strict or clear you make your policies, mistakes are made and documentation gets lost. It’s incredibly time-consuming to keep up with spending in an accounting department that must track multiple projects, each with its own timelines and budgets.

And even if the cardholder keeps accurate records, saves receipts, and submits expense reports in a timely manner, back-office approvals and reconciliations have their own time-consuming processes. Sometimes it can take hours to review, reconcile, and record a handful of transactions.

That’s why many construction companies and contractors are moving to modern corporate card platforms. These solutions give you an automated, real-time, cloud-based platform to manage workforce spending. They enable compliant purchases while simplifying and accelerating back-office operations.

Program Spending Rules Right Into a Corporate Card’s Functionality

Suppose you could make it impossible for someone to misuse a corporate card. Instead of needing to review every transaction, spend rules enforce expense policies. Spend rules automatically approve or decline transactions, and with receipt capture and notes, are part of a process that automates reconciliation as well.

With modern corporate card platforms, you program those rules right into the card’s functionality. The typical controls let you limit:

• Total spending
• Merchant categories (e.g., gas is okay, but restaurants are not)
• Specific merchants/stores
• Transaction amounts
• Transaction days and times

Easily Set Rules for Large Groups of Employees

For further simplicity, modern spend management platforms enable you to create role-based card groups, each with their own pre-set logic. Supervisors, drivers, executives, and others can have their own set of rules. Any employee cards assigned to the group automatically follow the same rules.

Know Instantly When Someone Tries to Break the Rules

If anyone attempts to use a card outside its predefined rules, then the transaction will be declined and the administrator will be notified. Whether it’s an honest mistake or the card has been compromised, administrators can address the issue.

Ensure More Secure Vendor Payments

These spending rules also let you create virtual cards for recurring or one-time bills. Since each card is created for a single purpose, you can set extremely tight rules. Virtual cards are more secure than checks because of tighter spend rules, automatic encryption, tokenization of the card number on each transaction, and the utilization of transaction-only card numbers.

The Flexibility to Approve & Fund Purchases in Seconds

While spending rules should protect you from fraud and misuse, they shouldn’t impede your ability to respond to emergencies or other changing needs. To address this, the new corporate card solutions work in real-time on a self-service platform.

24/7 Ability to Change Spending Rules From Anywhere

These platforms give administrators the ability to change rules and authorize purchases from a website or mobile app. It only takes a few clicks and seconds.

The rule change takes effect immediately. As soon as the administrator allows and funds the purchase, the cardholder can make the purchase.

An Auditable Record of Platform Activity

The platform keeps a record of approvals, funding, and purchase notes. If questions arise later, the answers are in the system. This can eliminate — or at least simplify — post-purchase reviews.

Permission to Distribute More Cards for Greater Flexibility

As mentioned earlier, the more cards you distribute, the more flexibility you have. Modern corporate card platforms let you distribute unfunded cards to as many employees as required. There’s no concern for misuse.

The strategy pays off when you send an employee on an errand. Administrators can turn a card on and fund the purchase. Card account managers may give limited administrator privileges to jobsite supervisors, so they can enable spending by workers under their stewardship.

When you can empower more employees to spend, but only when, where, and how much you want them to spend, you’ve achieved the ultimate balance of flexibility and control.

15 Times Faster than Manual Processes

Capture Receipts & Report Transactions From the Point of Purchase

Best-of-breed solutions give cardholders the ability to photograph receipts through a mobile app. Apps also let users append notes to a transaction report and choose general ledger codes from a dropdown menu. These menus can be preprogrammed to limit the codes to ones a cardholder is authorized to use.

With a system like that in place, most users can submit transactions before leaving the point of purchase. The platform will instantly connect the system’s record of a transaction with the cardholder’s report and queue it up for review. When finance opens the document, the transaction is already allocated to the approved job and budget.

Accounting & ERP System Integrations for One-Click Reconciliations

Many modern corporate card platforms readily integrate with major accounting and enterprise resource planning (ERP) systems. Your finance team can reconcile the transaction and upload it to your accounting system in seconds. 

There’s no need for expense reports to pile up. No place for receipts or reports to get lost. One PEX customer reports that the real-time reporting replaced five hours of reconciliation processes with 20 minutes of review and click. That’s 15 times the improvement in productivity.

An Easy Start to Your Digital Transformation

One corner of the industry that can quickly and easily benefit from digital transformation is workforce spending. The solutions discussed in this article cost nothing to install and take minutes to learn.

PEX customers have gone from zero to hundreds of distributed cards in a matter of weeks — and they see a return on investment almost immediately.

Modern corporate card platforms are the first step towards more streamlined and productive accounting processes.