As explored in the first part of this series, business use of subscription services (specifically SaaS) is becoming increasingly popular. It’s easy to see why. These tools enable businesses to securely scale up operations across a range of different business functions.
However, subscriptions aren’t without its downsides. The most notable issues being a lack of control and visibility on spend.
In this accompanying piece, we take a deep dive into how finance teams can use Soldo (or a similar tool) to create a single subscription management wallet or ring-fence subscription funds separately within departmental budgets. Ring-fencing funds provide a more granular layer of visibility that’s likely to be more suitable for larger or more complex organisations.
Applying one of these two approaches lets employees complete necessary subscription purchases. At the same time, it lets while CFOs get better visibility and optimise spends.
Create a subscriptions wallet
Using a spend management software is a simple way to create a dedicated wallet for subscription management. Especially for businesses with flat structures and just one team (like IT) who manages their subscriptions.
This consists of the following steps:
- Create a subscriptions expense centre within your spend management software to set aside associated spend for this purpose.
- Deposit money into the subscriptions expense centre. This can either be done manually or via automatic transfers. For example, you may wish for funds to top up by a specific value once they fall below a certain level or replenish them each month on a set date. This approach will allow vital transactions to occur while minimising the risk of unbudgeted overspending.
- Create and assign virtual and physical cards. Virtual cards are perfect for remote working and reduce the risk of cards being lost or misappropriated. There is also the option to create cards without an individual’s name. These are issued with a word, number or code instead of a specific individual’s name.
- Connect virtual and physical cards to the subscriptions expense centre on the Soldo web console. Cards without an individual’s name are easy to reassign to different people if staff move on, so the risk of orphaned subscriptions is minimised.
- Assign cards without an individual’s name for specific purposes and software subscriptions for an extra layer of control and visibility. For example, cards can be created exclusively for the likes of Salesforce and Oracle. This makes it easy for finance teams to see at a glance how much is being spent on individual vendors and to add auto top-ups and spend limits in line with their expected activity.
Ring-fence subscription funds from departmental budgets
Ring fencing funds is suitable for larger companies with a more complex approach to budgeting. Particularly budgeting based on departmental lines. For example, departmental budgets may consist of a breakdown of spend categories types rather than a set value across all transactions.
Ringfencing subscriptions funds consists of the following:
- Create an expense centre for each department’s overall budget.
- Deposit funds manually or automatically into each department’s expense centre.
- Create virtual cards without an individual’s name for each department and attach it to their main wallet.
- Set up rules for these departmental subscription cards so they are topped up when they fall below a specific value. Or that top up on specific days.
- For even more control and visibility, assign virtual cards without an individual’s name for subscriptions to specific vendors, and assign these to departmental expense centres.
Take control of subscription management
With the popularity of subscriptions likely to increase further, organisations should implement a subscription management strategy to control spend and give finance teams access to real-time data.
Soldo’s flexibility allows new and growing organisations to put bespoke subscription management solutions in place to suit their needs. Doing so will also free up significant time and remove bureaucracy and friction between finance teams and other departments.