Originally published in February 2023. Last updated on November 25, 2024.
Tracking your service business’s costs is just as important as keeping tabs on incoming payments. After all, it’s hard to know whether you’re making a profit if you don’t know how much you’re spending on mileage, supplies, and wages.
When it comes to monitoring spend, you have two options. You can do it manually, or you can use a business expense tracker. Which method you use depends on your budget, how many expenses you have, and whether you have the time to keep an eye on outgoing costs.
Learn what business expenses are, how to track them, and which apps work best in this overview.
What are business expenses?
Business expenses are made up of the administrative and operational costs associated with running your service business.
Depending on your industry and services, your business expenses may include:
- Job supplies, like paint, flooring, or fertilizer
- Employee and subcontractor wages
- Job equipment, like mowers, pressure washers, or nail guns
- Field service software
- Company vehicle payments and maintenance
- Equipment and vehicle repairs
- Job-related gas, meal, and travel expenses
- Cell phone and communication equipment and bills
- Office rent, furniture, and utility bills
- Advertising and marketing costs
- Safety equipment, like hard hats and steel-toed boots
Personal expenses, like meals during break time, don’t count as business expenses unless they’re related to doing business. For example, purchasing supplies for an employee BBQ.
READ MORE: Overhead costs: A complete guide for service businesses
What is business expense tracking?
Business expense tracking helps you identify how much you’re spending by monitoring all outgoing costs for your service business.
When compared to your income, it helps you to set and adjust your profit margin and markup and ensures your cash flow is positive.
You can also use business expense tracking to:
- Reimburse employees and subcontractors for business purchases like gas, parts, or supplies
- Determine which jobs are the most profitable and which are the most expensive
- Analyze costs to see where you can make adjustments to increase profit
- Inform your pricing strategy when deciding how much to charge for jobs
- Keep an eye on how much you’re spending vs. making so you can plan a growth strategy
How to track business expenses
Tracking business expenses can be done manually or using a business expense tracker app or software. Which option you go with depends on your budget, how much time you have, and how many expenses you need to monitor.
Manually tracking expenses can work well for individual service providers with few costs, but business expense tracking software works better for home service businesses with employees and various expenses.
Manually tracking business expenses
To manually track business expenses, service providers need to:
- Keep receipts and invoices for all costs associated with running their business, such as gas, tools, materials, and parts.
- Track mileage to and from job sites.
- Record expenses in a daily, weekly, or monthly report using a program like Google Sheets or Microsoft Excel.
If you have employees or subcontractors, you’ll need to record their wages and business purchases as well.
It’s best practice to add up and file your business expenses regularly so that you have a clear picture of what you’re spending. And don’t forget to keep your receipts and invoices—you’ll need them come tax time.
Tracking business expenses with software
If you have a lot of expenses, or you have employees or subcontractors who you need to reimburse or who make business purchases on the job, software is your best bet.
Business expense trackers make tracking costs easy by:
- Documenting receipts and invoices as images and attaching them to specific jobs
- Letting you track expenses while on the job so you don’t forget about them
- Tracking mileage to and from job sites
- Making it easier for you to track write-offs and store receipts for tax purposes
READ MORE: 30 small business tax deductions to save money when filing
Because expense tracker apps automate adding up costs, you can monitor profitability at a glance. In turn, this enables you to make informed decisions about setting prices, hiring workers, and buying new equipment and tools more quickly.
Pro Tip: Whether you track business expenses manually or using an app, you should still keep physical copies of your expense receipts. Even if you have pictures of them, files can be corrupted or unclear, and sometimes original copies of receipts are required for legal and tax purposes.
Business expense tracking apps for service providers
If you’re interested in using a business expense tracker to monitor outgoing costs for your small business, there are many to choose from.
To find the best ones on the market for home service providers, we:
- Researched app review sites to find the most highly-rated apps
- Watched app tutorials on YouTube to gauge how user-friendly they are
- Evaluated how helpful each app is to service providers based on real customer reviews
Based on our findings, these are the business expense tracking apps service providers like you found the most useful.
1. Jobber’s Expense Tracking software
Jobber’s expense tracking software is a good option for many service providers because it offers a variety of features in a single app.
Which business expenses does it track?
Using Jobber, you can track any business-related expenses, including gas, utility bills, supplies, equipment, wages, and mileage. Unlike some apps, it’s not limited to tracking specific costs, so you can use it to monitor, track, and reimburse all outgoing work transactions.
What features does it have?
Aside from basic expense tracking, Jobber also offers:
- Receipt scanning: You can scan and upload receipts straight to the Jobber app, preventing you from losing or accidentally throwing away paper receipts and invoices.
- Small business expense reports: You can view, filter, and export expenses to view costs related to a specific job or your outgoing costs for a given month. This helps you to set budgets, monitor spending, and see how well your business is performing.
- Field service CRM: Jobber has a built-in field service CRM that lets you attach expenses to specific clients or jobs. That way, you can use one tool to manage both clients and expenses—instead of two or three.
- A FeetSharp integration for mileage tracking: Jobber offers mileage and fuel tracking through FleetSharp, so you don’t have to rely on your employees to remember to write it down.
When you add expenses to Jobber, you can link them to specific jobs. From there, Jobber tracks all costs associated with that project so you know how much to charge to cover your expenses. That way, you can make a profit on every job instead of scrambling to cover costs out of pocket.
Who does it work best for?
Jobber works great for small and medium-sized service businesses that:
- Have multiple employees or subcontractors
- Use more than one work vehicle
- Have a variety of regular expenses
- Want to manage clients and track expenses in one place
- Need to track expenses on the go
2. Expensify Expense Management Software
Expensify works well for service business owners who need to approve and reimburse expenses on a regular basis.
Which expenses does it track?
Like Jobber, Expensify tracks any and all business expenses. It also offers automatic mileage tracking.
What features does it have?
Expensify comes with a lot of great features that small business owners love, including:
- Useful integrations: Expensify integrates with other platforms like Quickbooks and Uber, as well as HR, travel, tax, and receipt software. This enables you to customize its business expense tracking to your needs.
- Expense approval and delegation: You can delegate expenses to certain employees for approval, reimbursement, or filing to make your job easier. For example, you can set it up so all receipts are sent straight to accounting staff to approve and reimburse.
- An Expensify card: Expensify offers an Expensify Visa Corporate Card that you and your employees can use to pay for business expenses to make tracking and monitoring costs easier.
Who does it work best for?
Expensify works best for home service businesses that:
- Need to track a variety of different expenses, from travel and mileage to parking and wages
- Approve and reimburse a lot of business purchases made by employees and subcontractors
- Want a business expense tracker that can integrate with their existing platforms
3. TripLog
Unlike Jobber and Expensify, TripLog is meant for business owners who only want a business expense tracker for mileage costs associated with jobs.
Which business expenses does it track?
TripLog is dedicated to mileage costs and can’t cover other expenses, but it does offer banking and accounting integrations.
What features does it have?
As a mileage tracker, TripLog’s features include:
- Software and hardware: TripLog offers three different tracking options. You can track mileage using their app, or you can use their GPS mileage tracker or USB mileage tracking beacon, which both plug into your vehicle. Both hardware options help you to track routes, driving times, and stops, automating mileage tracking to reduce human error.
- Banking and account integrations: TripLog offers a variety of banking and accounting integrations to make bookkeeping easier and facilitate reimbursements. For example, it can work with company credit cards and import transactions right from your bank accounts.
Who does it work best for?
TripLog is best for service providers who want to focus on tracking mileage expenses.
What to look for in a business expense tracker
There are many different apps you can use for small business expense tracking. But which one you go with depends on the following factors:
- Your budget. Different apps come with different price tags. If you’re just starting out and you have limited costs, you may not need the most flashy or complex tracking app. On the other hand, if you’re ready to grow your business and have some money to work with, investing in expense-tracking software that also offers other features, like quoting, scheduling, a CRM, and invoicing may be a good option.
- What you need expense tracking for. If you have tons of different expenses, you need a business expense tracker that can handle a variety of costs. But if you’re only worried about keeping an eye on mileage for now, then go with something more specific.
- Who’s going to use it. Are you the only one who needs to track business expenses, or do you have employees or subcontractors with costs to write off?
- When you need it. If you want to track expenses while on the go, Jobber is a good choice. But if you only want to input expenses at the end of every day, week, or month, something simpler may work just as well.
What are the benefits of using an expense tracker app?
Tracking expenses is essential to ensure your business is making money instead of losing it. While manually inputting expenses works for some, software is a better option for many service business providers because:
- It reduces human error. Manually entering and calculating business expenses leaves you at risk for mistakes. Just by entering the wrong number, you can throw off your entire calculation, making it look like you spent or made more than you did. Expense tracker apps prevent you from having to deal with mathematical errors, keeping your numbers correct.
- It can automate expense reports. These reports show you how much you’re spending, giving you more control over costs so that you can make adjustments when necessary. And, because they’re automated, you won’t have to take time to add them up yourself.
- It keeps you organized. If all your expenses, invoices, and receipts are available in one place, you’ll save a lot of time during tax season and reduce your accounting workload. It’s also beneficial when you need to refer back to a job to review costs or approve an employee expense.
- It can save you money. Because business expenses usually count as tax deductions, software can help you maximize your write-offs by making it easier to track, document, and compile them. That way, you won’t miss adding an expense or lose out on a deduction because you lost a receipt.
- It helps with job costing. The better you understand how much jobs cost, the easier it is for you to price them. By keeping an eye on spend as you go, you can ensure you include enough markup to meet your desired profit margin.
READ MORE: Key business metrics to plan for growth and success
By paying attention to your expenses, you have a better chance of seeing what you need to do to cut costs, promote the most profitable jobs, adjust pricing, and grow your business.
Using an expense tracking app will help you stay on top of your incoming and outgoing income, allowing you to pivot and make changes to your strategy before it becomes a problem.