In a recent article I shared the results from a study OPEN commissioned with Accenture that showed how certain business owners are getting greater value out of how they use their OPEN Charge Cards.1 We learned that by charging most of their expenses and taking full advantage of the OPEN “system” – including OPEN Savings, the Membership Rewards program and OPEN expense management tools – some “best-in-class” businesses are seeing significant savings in time and money, and improvements in their cash flow.
I’d like to further explore how they’ve been able to save money.
Basically, businesses can cut costs through three spend-related features: Membership Rewards redemptions, OPEN Savings discounts and/or Plum early pay discounts.
The study found that best-in-class businesses keep a much lower balance of Membership Rewards points balance in proportion to annual OPEN Card spend, typically representing about one and a half years of spend versus over five years for other companies. This means that the best-in-class more actively use their points versus storing them. The study found that these best-in-class companies reinvest about two-thirds of their points back into their businesses, such as through employee incentives or customer loyalty programs. Jeffrey Herold, owner of Club Glove, has been an OPEN Cardmember for 12 years. He told us, “When we need to get a flight and we can’t find anything reasonable cost-wise, we use points. At times, we also upgrade a staff member to first class on a business trip. It’s a wonderful incentive.”
Another way businesses maximize savings is by using the Plum Card. Instead of providing Membership Rewards points, the Plum Card enables businesses to receive a 1.5 percent discount on eligible purchases made within a month, as long as the balance is paid within 10 days of the statement closing date.
And, businesses using either the Plum Card or other OPEN Charge products can also save by actively selecting vendors who offer discounts via OPEN Savings. The study found that these discounts contribute to almost one-fifth of all savings for best-in-class companies.
The study found that by combining OPEN’s rewards and discounts, best-in-class businesses were able to cut their total expense base by 1.1 percent. To learn more about this example and best practices for how a small business can capture approximately $15,000 in value for their bottom line, download and read “How High-Performing Businesses Boost the Bottom Line through American Express Business Cards.”
I hope this study will give you ideas that can boost the bottom line for your own company. If you use any of these or other strategies, I invite you to share your story with me at email@example.com. Your experience may provide valuable insights to other entrepreneurs.
Download your complimentary copy of “How High-Performing Businesses Boost the Bottom Line through American Express Business Cards.”
1Based on actual customer data obtained by Accenture in March 2010 via research of OPEN Charge Cardmembers. The Study, consisting of interviews and surveys involving over 135 U.S. firms using an OPEN Charge Card – ranging in size from 1 to over 100 employees and in revenues from $200,000 to over $20 million a year –shows that small businesses can derive substantial value by using the OPEN system.