Return on Investment for GovCardConnect
GovCardConnect is a fully automated solution pulling its data from Deltek Costpoint. It saves you money on transaction fees and labor!
Let’s walk through a scenario of a Government Contractor who processes $1,000,000 per year in Government purchase card transactions. For this exercise, let’s assume an average transaction size of $1,000 and 1,000 transactions per year. Finally, let’s assume the person(s) processing the payments and reconciling the deposits makes $60,000-80,000 per year with a combined fringe and overhead rate of 80%.
Pay the Lowest Transaction Fees Possible
GovCardConnect pulls the data you need from Costpoint for Level 3 transactions, which can qualify for the lowest possible rates. These rates are typically 1% lower than ordinary transactions. For large transactions the rates can be even lower. Saving 1% on $1,000,000 would deliver $10,000 to the bottom line. Savings: $10,000 per year.
Lower Your Costs of Re-entering Invoice Data
Through the Federal Strategic Sourcing Initiative and other programs, the Government is requiring Level 3 data – the line item transaction details. Keying in invoice data can be time-consuming, and time is money. Entering all the invoice data, even for a short invoice, can take 5-10 minutes – for large invoices much longer. With GovCardConnect, this data is pulled automatically from Costpoint, so in 2 mouse clicks the data is gathered and sent – regardless of the size of the invoice. Plus, we’ve eliminated the possibility of human error by eliminating the re-keying data. (For the purposes of these calculations, we’ve ignored the cost of hunting down and correcting mistakes.) Savings: $6,100 per year.
Lower Your Costs of Reconciling Deposits and Transactions
Deposits come in and include multiple transactions – trying to mix and match between bank statements and credit card statements can be another time-consuming exercise. Let GovCardConnect eliminate that labor cost.
After a transaction has been processed, typically within a day or two days, the monies are deposited in the Government Contractor’s bank. With multiple transactions on a single deposit and transactions fees being withheld, it can become a tedious exercise of matching invoice numbers to a reference numbers to a deposit number – then enter the deposit in Costpoint. Based upon observations, we’re looking at a low range average of 5-10 minutes per deposit. Savings: $5,700 per year.
Adding It Up… Total Return on Investment
A government contractor doing $1 million in SmartPay card transactions can save $20,000 to $25,000 per year in G&A expense.