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Torben Robertson

5 mins

Procurement wants outsourced mileage reimbursement programs

Outsourcing vehicle programs can save companies money and time. This is valuable to Procurement as in-house programs can be difficult to manage and costly.


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How can procurement specialists pick a mileage reimbursement program?

The decisions of a procurement specialist require clarity and confidence. One must properly assess the quality of a vendor and decide if engaging a vendor is worth company money.

When deciding whether a vendor is worth the investment, procurement specialists ask:

1. Does the product or service optimize my company’s processes?

2. Does it save my company money?

3. Is there a proven return on investment?

4. How does this vendor compare to their competitors?

Let us examine these questions in turn, as they relate to outsourced vehicle reimbursement programs.

Does the product or service optimize my company’s processes?

The best vehicle reimbursement programs absolutely optimize a company’s processes. Depending on what system currently exists in the company, the effects can be enormous. Procurement specialists note significant improvements to their business vehicle programs when they outsource them.

Common issues we hear from procurement specialists depend on their existing vehicle programs. They often come from the following vehicle systems:

i. Fleet
ii. Reimbursement programs with manual mileage tracking  

Each has its own drawbacks.

i. Fleets are expensive, carry the most risk of any vehicle program, and require the most time to manage. For example, it is logistically challenging to transfer company cars between employees when new people enter and exit the company. Moreover, fleets of company cars are sent home with the workforce, and if an accident occurs while driven on personal time, the company is still responsible for the damages.

Read more about fleets here.

ii. Reimbursement programs with manual mileage tracking are cumbersome. Time is wasted when drivers log their mileage on spreadsheets with reference to their odometer (they also need to record other information, like departure and arrival points, for IRS compliance). Time is also wasted when drivers must hand off their mileage logs to HR for reimbursement processing. For example, HR must adjust every driver’s paycheck individually to reflect the precise value of their reimbursement expense. When you have 100 drivers, that is a lot of number crunching.

Does the product or service save my company money?

Outsourcing vehicle reimbursements leads to money saved. In-house reimbursement programmers often miss opportunities, because they lack the software and the expertise necessary to maximize cost-reduction. Two vehicle programs that procurement specialists ditch to save money are:

  1. Car Allowances
  2. Cents per Mile

Car allowances are treated and taxed like income by the IRS. This leads to a significant amount of tax waste. The amount of money you can save by outsourcing your vehicle program depends, but Cardata’s clients often see a 30% reduction in their total program costs.

CPM—cents per mile reimbursements—are inaccurate because they are not geography specific. Set by the IRS (and the CRA in Canada), a CPM reimbursement is a set per-mile figure. In 2022, it could be slightly higher or lower than the existing figure:

Lastly, with manual mileage tracking systems, overspend is common. It is natural for people to round up when they cannot remember their odometer reading. No one is to be blamed for doing so; it is just a fact.

Cardata solves many of these problems by implementing software solutions. Part of this solution is automatic mileage capture through Cardata Mobile, our app.

Is there a proven ROI?

Different vendors will have different ROIs. Cardata’s is certainly among the best. When companies transition to a Cardata reimbursement program, they often see returns on investment in excess of 250%. If you would like to know your company’s projected ROI, schedule a discovery call with us.

How does this vendor compare to their competitors?

There are many ways to assess the quality of a company. At Cardata, we like to let our clients speak for themselves.

With that in mind, we invite you to visit our G2 page. Their winter 2022 reports just came out, and we are pleased to announce that we have ranked highly in a variety of categories. For example, we are:

  • Easiest to do business with in Mileage Tracking software*
  • Easiest to do business with in Travel and Expense software*
  • Easiest to do business with in Expense Management software*
  • Best relationship in Mileage Tracking software*
  • Best support in Mid-Market Expense Management software*
  • Best support in Mid-Market Travel and Expense software*
  • Easiest to do business with in Mid-Market Expense Management software*
  • Easiest to do business with in Mid-Market Travel and Expense software*

*(Visit our G2 review page to learn more)

Additionally, procurement specialists want to guarantee that the optimization and cost reduction they were promised materializes. Cardata monitors their clients’ vehicle programs more closely than their competitors, guaranteeing that risks and tax waste are proactively avoided. Cardata’s customer service is also the most responsive. Responsive customer service means that whenever a client stakeholder has a question, they use their direct line to a Cardata. At Cardata, no customer call is too small to answer.

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