Julie wants to create a policy with input from her salespeople. She wants to balance the need to serve clients with Mountain Peak’s desire to control spending and account for all expenses. Once the policy is written, Julie needs to clearly communicate the reimbursement guidelines to the entire company.
With these points in mind, Julie meets with Mountain Peak’s salespeople to discuss spending. She asks her staff to explain client expectations about meals and entertainment. The group determines that the majority of the spending is for customer lunches and dinners, with some additional spending for entertainment, such as tickets to sporting events and concerts.
During the meeting, Julie reviews last year’s spending with the sales staff. Mountain Peak generates the majority of their business from sporting goods stores in 20 cities, and the salespeople spend most of their time in those locations. Julie and the sales staff use the historical data to come up with spending estimates for lunches and dinners in those 20 cities. The group decides that a reasonable budget amount for the salesperson and a client is $50 for lunch and a $100 for dinner. Entertainment spending will be discussed with Julie and approved in advance.
The group agrees that some meals and entertainment will be more expensive, depending on the individual. A sporting goods company CEO will require more spending than a meal with a sales manager, for example. Julie will approve spending above the budgeted limits for meals.