Allowing employees to make business purchases via online accounts—specifically Amazon Business—has gained significant popularity in recent years. It is now safe to say it is more than a trend, and there is a good chance your organization already uses it. Like all avenues of business purchasing, however, such accounts have their pros and cons. How do you take advantage of it, while still avoiding its pitfalls?
What is Amazon Business?
First, it’s important to fully understand just what Amazon Business is all about.
According to Amazon’s website, when a company registers for an Amazon Business account, any employees designated to do so are allowed to make purchases from Amazon on the behalf of that company. Also, Business News Daily has a good introductory article about the basics of Amazon Business which we’ve linked here.
The administrators of the Amazon Business account manage who can use it — and how they can use it. Customizable features include a choice of payment methods, the ability to add different shipping addresses, and a variety of reporting options. Often, business pricing is available, as well as faster shipping options. All this, along with the convenience of doing transactions online, can make Amazon Business quite attractive to companies looking for an easy way to give employees the ability to make purchases.
Purchases can get personal
There’s a reason why Amazon’s logo includes an arrow that starts at the letter “A” and ends pointing to the letter “Z” — It truly sells everything from A to Z. You’d be hard pressed to find something that is not sold on Amazon.
But with such great buying options and potential comes great opportunities to commit fraud via personal purchases. As a business, you might be able to limit personal purchasing when buying from certain vendors, if only thanks to their very specific and limited scope of products. For example, if you are a manufacturer in the food industry, you probably don’t have too many employees trying to buy your vendor’s extra-large, commercial-grade, food-safe air-compression guns for their own personal use at home. No worries there.
However, with so many varied products for sale on Amazon, it’s becomes virtually impossible to limit personal purchasing solely by the nature of the products. A search for “conveyor belts” and a search for “fashion belts” are both just as easy to do and just as accessible — and equally purchasable.
Personal purchases like these should not only be a violation of your organization’s policy, but they’re also a violation of Amazon’s policy.
Set up parameters in your policies
So how can you draw the line between business and personal purchases via Amazon Business? A good first step is to create parameters within your policies that help employees know what can be bought and what cannot, as well as for what purpose. As naïve as it may sound, employees could genuinely use the excuse of ignorance in a defense of the purchase of personal items. Developing sound and effective policies and then communicating them through the education of your account users defuses that defense.
What do such policies look like? They should include, at least, the following:
- There shall be no purchasing of items for a personal use via the Amazon Business Account. All purchases must intended for use in, with, and by the company for business reasons
- Tax exemptions may or may not be permitted for the company on Amazon Business. Confirm before using the account and making the purchase.
- Do not use Amazon Business if and when there is another vendor with whom the company already does business that offers the same products for sale.
- Get any possible additional shipping costs approved before making your purchase.
Take the time to think of any additional pitfalls that are specific to your business and the way purchases would be made by your employees with an Amazon Business account, and then create policies accordingly to address those concerns.
Use online training to communicate your Amazon Business policies
Rather than just handing out a booklet to your employees, consider using more formalized training to communicate your policies on purchases. By doing so, you can better ensure that your employees fully grasp and comprehend what they are being asked to do. It also gives them a chance to ask questions in an environment that is more structured, open, relevant, and inviting than knocking on a manager’s door. It also helps to ensure that everyone has actually been exposed to the policies (as opposed to them being tossed into a desk drawer, never having been read).
Fortunately, Card Integrity offers such training, which is completely customizable to your policies and procedures. TrainingWISE—Card Integrity’s training solution—can set up a course that focuses just on your Amazon Business policies, to help purchasers in your company come up to speed with the new process, in order to learn how the account works and all the “Dos and Don’ts” that go along with it. Never again can an employee claim, “But I didn’t know!”
Keep tabs on purchases
The next step is to make sure that inappropriate purchases are not going unnoticed. Card Integrity can help you manage your Amazon Business account to ensure that you have complete knowledge of your company’s purchasing—who, what, and when—and as such, limit the risk of fraud.
By using Card Integrity as a third-party auditor, any Amazon Business purchases that are not in line with your policies will be flagged and revealed in monthly findings. The summary of detailed information can be customized in a way that best serves your company’s needs, to keep inappropriate spending and downright fraudulent acts to a minimum. Card Integrity can keep you informed both whenever a personal credit card is used on your company’s Amazon Business Account, and when a personal purchase is detected on the account. Card Integrity can even create warning notification emails to send to cardholders and account users when these types of policy violations are uncovered.
Making purchases via Amazon Business can be more efficient and effective for your company, as long as you create an account that is as ready for the pitfalls as your business is for the conveniences. To learn more about best practices for your purchasing program, check out our free Expense Monitoring Checklist below!
