To improve freight invoice and carrier management, freight audit and payment is the best option. It can enhance the process and provide endless possibilities for cost optimization. Rather than losing money having to pay for detention and accessorials, freight auditing can provide the opportunity to dismiss or refute inaccurate charges before it’s too late.
Overpayment or repayment are crucial problems to watch for as nobody wants to spend money unnecessarily. Reviewing invoices manually and staying up to date without error cannot be done, but using technology and data tracking can maximize efficiencies. Data is vital in the supply chain industry and for freight billing management, having real-time data is crucial to analyzing where and what needs improvement. By using freight audit and payment, shippers can know exactly where the money is and where more profits are possible, all while ensuring a proper carrier and shipper relationship. Let’s take a look at why a lack of auditing results in issues, how it builds better relationships, and a few ways it creates more opportunities for collaboration.
The Problem: Limited Freight Audit and Payment Leaves Money on the Table
Knowing when invoices have been paid or are awaiting payment, and where there are issues with payment delays, can benefit budget management and financial stability. Maximizing profit can quickly become a reality with automated invoicing and intelligent financial data backing decisions. Unfortunately, protection from misappropriation of funds or additional delays in payment can fail, but trusting an auditing solution like Intelligent Audit that partners with a bank for shipping payment can go a long way toward restoring that protection and securing your transactions.
Furthermore, efficient freight audit and payment utilize cutting-edge digital tools such as carrier scorecards for quick and seamless reference to the experiences of shippers and helps your team identify where service failures or opportunities for improvement exist in selecting carriers and more. Ultimately, limited auditing leaves money on the table and results in less-trustworthy shipping relationships.
Integrated Audit and Payment Improves Carrier Management.
Outsourcing freight audit and payment can offer a secure way to extend payment time for shippers and expedite payments to carriers. Shipping rate inaccuracies, unexpected detention costs, accessorial charges, and other costly errors can be avoided simply by knowing where they’re happening. Experiencing the greater efficiencies of using technology and freight audit and payment can provide relevant information to help your team manage carrier relationships. Having a good relationship with carriers is key to gaining actionable insights. Looking at the relationship carriers and shippers had last year, JOC states, “FAP vendors last year encouraged shippers to use them as levers to improve relationships with carriers, particularly truckload and less-than-truckload carriers, where freight payment and auditing services are most often deployed.” Furthermore, this can help support accurate decision-making that helps drive increased ROI. And it’s also necessary for the advancement of new fulfillment models, like crowdsourcing. Consider how crowdsourced delivery and freight auditing can use real-time data to provide efficient strategies and provide standardized reporting for shippers. Yet, not having the proper resources to process carrier requests can result in losing the carrier and missing out on profit.
It Creates More Collaborative, Strategic Relationships
The strength of any relationship among business partners revolves around addressing known concerns and needs to ensure effective decision-making. Having a reliable reputation and gaining the trust of carriers will help secure increased freight capacity by strengthening your eligibility for shipper of choice status. By optimizing freight audit and payment and having payments settled in a timely manner, shippers will gain favor of carriers. Further, as we laid out in a previous article, having a freight audit and payment solution provides shippers a mechanism to collect, cleanse, normalize, and analyze shipping data to gain actionable insights. A data-driven, analytics-rich shipper makes smarter shipping decisions and can collaborate with carriers to improve service, optimize costs, and have mutually beneficial contract negotiations devoid of anecdote or ambiguity, decreasing any potential friction.
Additionally, along with those positives, freight auditors also bring more data analytics to manage and strategically minimize the risk for error. Using technology allows for easy access to data and helps keep carriers and shippers aligned. Along with this, more benefits from freight auditing that allow shippers and carriers to collaborate may include:
- Increased accountability among transportation network partners.
- Greater control over parcel carriers, including when to use regionals versus nationals.
- Carrier savings through zone skipping result in favorable carrier-shipper relationships.
- Bank-based payment management reduces confusion in settlement.
- More working capital for shippers means more shipments tendered to carriers.
- Increased visibility to measure the health of your business and know when/where to reinvest in the business.
- Increased eligibility for shipper-of-choice status among partnering carriers due to a shorter payment clock.
- Data and analysis allow you to have more fact-based data-driven conversations with carriers.
- Data normalization across multiple aspects can make comparing trends easier.
Improve Carrier Relationships With Freight Audit and Payment
Much like 2020’s peak season, this year is going to require increased efficiencies and reliable transportation to meet demands. Freight auditing uses data-rich, cost-effective, normalized data that provides smoother functioning and access to actionable insights from beginning to end, ensuring more profit while controlling costs. Resources such as crowdsourced delivery and freight audit and payment in the logistics industry can provide decreased costs during any season. But there may be other opportunities that your existing auditing strategy has overlooked. Additionally, carrier relationships that are more strategic in nature will provide increased visibility to ensure your team understands shipping spend and where improvements are needed. To see these benefits and many more, contact Intelligent Audit today and start seeing the positive results in your shipping spend through improved carrier relationships.