Lack of Cost-Effectiveness

Companies lose out on economies of scale and negotiating power by funding individual employee purchases across many suppliers. This dispersed spending prevents them from securing better rates.

Poor Scalability

Costs increase directly with employee numbers, offering no efficiency at scale. This leads to a heavy administrative burden checking receipts or, if unchecked, a high risk of misuse and significantly higher costs.

Absence of Data-Driven Insights

Companies have zero visibility into outcomes, so they can't tell if benefits are actually used. Limited understanding of employee needs without structured data makes effective prioritization impossible.

Weak Negotiating Position

When spending is scattered across numerous individual purchases and suppliers, companies lack the leverage to negotiate value or secure better rates for benefits.

Increased Administrative Burden

The process of managing individual employee expenses creates a significant administrative load, requiring either time-intensive receipt checking or the risk of uncontrolled misuse and inflated costs.