Despite the government being urged to help reduce the pressure on social care services and the wider health system, care homes are in desperate need of help to manage their cash flow as inflation rises. By Ian Johnson, SVP Market Development at Soldo
As the sector waits for government support, it is vital care homes have full visibility over their outgoings.
Soldo’s recent survey into care sector spending revealed that petty cash is used in almost two-thirds (62%) of care homes, making this impossible.
Many costs are uncontrollable, including gas and electricity, but managing the spending that is within their control is something care homes must do to remain commercially viable.
Painting a picture of care sector spending
The survey asked care sector employees about their care home’s monthly outgoings, what they were spending on, how they managed the spend and more. It discovered that the majority are still relying on outdated manual processes which makes it difficult to navigate challenges like rising prices and unpredictable cash flow.
The results highlighted that teams were regularly making purchases, including support workers, carers and office-based teams like marketing, finance, and HR.
Nearly 40% of them were purchasing on a weekly or daily basis, and more than a quarter (27%) of teams have a monthly budget of £1,000. What these statistics signal is that there many outgoings in the care sector and in different departments but tracking payments in real-time is a challenge for the finance team.
We understand that 46% of this money is spent on catering and 30% on facilities management. Both these are affected by the cost-of-living crisis. Having visibility and control over every payment being made will be a necessity to save money and keep services open.
Freeing teams from time-consuming tasks
It is an understatement to say that the care sector is busy, and the last thing those working in care need to worry about is setting time aside to manually manage finances. Yet this is the reality for 86% of support workers and carers.
The Soldo research discovered more than one third (36%) are paying for goods and services with their own money. This creates paperwork and can lead to resentment if people must wait to be paid back, while it leaves organisations open to unexpected purchases.
With prices continuing to rise, pay rates plateauing and a recession looming, the care sector must find ways to take control of spending and reduce costs.
With oversight of company spend in real-time, such challenges are not an issue.
Not only are busy employees not out-of-pocket with prepaid cards, but they are also given more freedom to make needed purchases. This improves the quality and efficiency of your care services in the process.
What is more, care workers working on the frontline will benefit from their roles becoming easier and more rewarding because they will be able to focus on what they do best – caring for people.
More from Soldo here.