ABCs of Corporate Cards
Corporate credit card programs are important in a well-managed travel program. Many corporations offer a standard travel and entertainment card for their employees. In addition to providing travelers with the means of paying for their T&E on the road, a card program generates valuable data about costs and can back-end rebates based on spend. For the travelers a corporate card means not having to pay out of their own pocket and then wait to be reimbursed. Companies often provide purchasing cards to individuals to handle smaller departmental spend. These cards are automatically paid at month's end without filing an expense report. Although rarely used for transient travel, they may be used for meetings and events.Virtual cards have a unique card number that can be set up for a single purchase, which mitigates risk of credit card fraud and eases expense reporting. It’s great for people who do not travel regularly.
WENDY PALMER
wpalmer@epri.com
One Lucky Buyer
I am lucky enough not to have to manage our card program at Tapestry. So rather than give you outdated information from when I did manage a corporate card program, I interviewed our global corporate card lead, Victoria Moore. Partnering with Victoria shows me how a global card program should be run and I asked her to share her expertise.The benefits of well-managed program include:
• As T&E spend and non-T&E spend are the largest areas of employee fraud, a card program can add an extra layer of audit and reporting.
• The card program can also be profit center rather than a cost center.
Characteristics of a well-managed program include:
• A program administrator understands employee needs and spend.
• An enforced policy puts restrictions on spend and controls on cards.
• Expense programs can be automated.Advice for a company looking to start or re-do their card program:
• Choose your banking provider wisely – your card partner will be key. You should benchmark with other companies in your industry.
• Bring on a resource to administer your program – remember, a well-managed card program can be a profit center.Finally Victoria advises that earning her industry certification, a CPCP (certified purchasing card professional), helped her grow from a tactical administrator to a strategic manager.
Rosemary E Maloney
rmaloney@coach.com
Pros & Cons
Corporate card programs have their advantages and disadvantages, especially in the eyes of the traveler. Some travelers appreciate the ease of use, integration with expense tools and the fact that someone else funds their business travels. Other travelers treasure their points and are happy to wait for reimbursement. But for the corporation the benefits are certainly more positive than negative. With cards, companies can manage payment terms creating positive cash flow, and cards provide control mechanisms to reduce fraud and corporate exposure. Additionally, they can earn rebates turning the card program into a potential profit center. The key is for the organization to expand their card program from just the traditional T&E plastic, so that it includes new products like P-cards, meetings cards, BTA’s and virtual cards. I believe if organizations truly leverage their card programs the benefits far outweigh any challenges.
JENNIFER STEINKE
jennifer@wholdings.travel
All Things Considered
Corporate cards provide a lot of value to any travel program. They provide convenience to travelers, data to corporate programs, and may include financial benefits to the corporate customer. I have worked at companies that provide corporate cards to their travelers and some that do not. From a traveler’s point of view, it can be a hardship to always use your personal credit for company business. Expense reports must be timely so you don’t have money coming out of your pocket for company travel. On the other hand, you may get more benefits from rewards programs, especially if your company does not allow rewards from corporate card use. But all things considered, I would much rather use a company-provided corporate card than use my personal credit card.
Mark Ziegler
mark.ziegler@netapp.com
Whose Money Is It?
I have managed travel programs for companies that mandated a corporate card program and ones that allowed a traveler to utilize their personal cards for business travel – I am a proponent of having a corporate card program.From a procurement standpoint, corporate card programs offer rebates based on the amount of spend placed on the cards. This is a great ROI for a managed T&E program. Corporate cards also have built-in travel insurance in case of disruptions or emergencies that many personal cards might not offer.Reporting is another huge advantage, not only for negotiating leverage with suppliers, but from a compliance perspective. Travelers may prefer earning points on their personal cards; however it is company money and the benefits of a corporate card program outweigh personal points.
Chris Brockman
chris@wholdings.travel
