a large fee is justifi ed. If your needs are smaller scale,
look for solutions that have smaller fees.
REWARDS
Depending on your business’ size and how
much you spend, card reward points can add up
signifi cantly and potentially save you thousands,
tens of thousands, or even hundreds of thousands
in expenses each year. To take the best advantage of
them regardless the your business size, research the
reward programs you are considering to make sure
they fi t your business on both ends, accrual (where
you spend) and the redemption (where you redeem).
Diff erent card providers off er diff erent rates of
rewards accrual depending on what you purchase,
and those rates are based on the provider’s
partnerships. Some off er extra rewards for travelrelated
purchases, while others off er more for
gas, and many partner with particular retailers to
off er additional rewards for purchases from those
stores. Whatever the setup is, make sure it fi ts your
purchasing pattern. In other words, don’t subscribe
to a travel-focused card if you and your employees
don’t travel, and if you have a favorite vendor and a
card program off er 2x rewards for shopping there,
strongly consider that option.
CREDIT CARD VS. CHARGE CARD
Traditionally, the chief benefi t of having a business
card was simply cash management, record keeping
and potentially the ability to defer payments or carry
a balance. In other words, funding fl exibility. All
card programs off er some cash fl ow advantage in two
ways, the ability to eff ect purchases without a check
or cash and the ability to defer payments on those
purchases by at least 20 days, sometimes longer.
Some cards are true credit cards that allow you to
carry a balance from month to month in exchange
for interest payments (most Visa and Mastercards).
A charge card provider expects you to pay the
balance in full each month (the majority of Amex
cards). Either off ers you the advantage of being able
to defer payments by a month, but the choice comes
down to how much fl exibility you think you need.
Typically the rewards programs on charge
cards are more advantageous, they feature higher
spending limits and the total cost of them is lower
because you’ll not be paying interest, but they
off er less fl exibility. A credit card program can still
off er rewards, though they won’t be as generous as
those with a charge card, and they allow a lot more
fl exibility through the ability to carry a balance, but
at the cost, of course, is interest.
If you have not selected a card program for
your business yet you should do so, you are most
certainly missing out on operational effi ciencies
and substantial rewards or cash back. Evaluate
the criteria listed above to fi gure out what fi ts and
choose the card that’s “just right” for your business.
About the Author
Josh Fiorini is the former CEO of PTR Industries Inc.,
and spent the fi rst decade of his career in fi nance holding
positions as an equity analyst and portfolio manager
before starting his own hedge fund that led him to the
fi rearms industry. Th is experience, along with a deep
background in manufacturing, banking and private
equity has made him a sought-after contributor on
numerous boards and discussion groups on political and
economic issues.
Currently, Fiorini invests his time and resources into
non-profi t initiatives and acts as a contributor and
management consultant to various fi rms in the fi rearms
industry. His activities have been reported in such
publications as Th e Wall Street Journal, Th e New York
Times and USA Today.
INDUSTRY
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