With an abundance of data available and innovative methods at the manager’s fingertips to analyze and apply said data, it is easier than ever to collect, analyze, and utilize it. Shippers regularly spend up to 10 percent of gross expenses on transportation spend management and related shipping expenses. Aside from labor costs and freight payments, transportation and logistics management—including paying carriers and sending freight—can eat up budgets and add to fees. Freight audit and payment (FAP) service providers can assist with data collection and application regarding transportation spending. They have the expertise, technology, and insight needed for effective freight and transportation management.
Why Internal-Only Data Limits Your Ability to Derive Actionable Insights
As e-commerce grows in popularity and value, freight spend will continue to increase, further emphasizing the need for assistance with negotiating contracts and securing available capacity. To stay competitive, shippers need to understand the importance of auditing and strategic management practices to maximize actionable insights.
Robust transportation spend management relies on data that is not only focused inwardly. According to Inbound Logistics, “paying freight bills on time and accurately helps shippers become ‘shippers of choice,’ a designation that makes it easier to secure capacity and move freight reliably. At the same time, few shippers want to pay more than they owe, or more than similar shippers in their market are paying to move their freight.” Maintaining a fair rate and keeping tabs on freight spend and transportation expenses can be improved with FAP and historical data that extends beyond internal-only e-commerce trend monitoring. But why?
Internal shipping data is great. After all, it includes all the information affecting your internal operations and plans. However, the supply chain is much more than your in-house resources.
It’s this level of expansion and outside influence that can have the biggest impact on your operation. Furthermore, the external data sources available come from countless different platforms, and it’s not necessarily designed to be compared in its raw form. As a result, it’s imperative for shippers to start thinking strategically and analyzing this data, after it’s been ingested, normalized, and cleansed, to derive actionable insights that will add value throughout your operation.
Combined FAP and Historical Data Open New Avenues to Revenue Savings
Many Freight Audit and Payment providers today offer services and tools that go beyond basic transportation spend management. The focus on optimized freight audit and payment offerings make it easier for shippers to collect, analyze, and respond to historical data records and trends. These often include transportation management solutions and analytical tools that allow for a more personalized and collaborative approach to tracking and monitoring logistical data across the board. The growth of e-commerce also is changing the FAP industry and continuing to impact transportation spend management and freight auditing opportunities.
Additional Ways More Data Increases Value
More and more shippers find themselves needing freight bill auditing services and assistance that comes with a global perspective. Shippers need FAP providers that have their hands in various regions worldwide and can manage multiple lanes, modes, currencies, languages, regions, regulations, policies, and laws. Increased value within the supply chain can help curb expenses and improve transportation spend management across the board. This can all be accomplished in several ways:
- Hub Injection – expanding the reach and hub access can help reduce freight invoice errors and transportation expenses.
- Carrier Diversification – having a versatile carrier base to pull from helps shippers adapt and maximize capacity.
- Zone Skipping – streamlining the shipping process and choosing the most direct lanes can reduce freight spend.
- More Regionals – handing deliveries off to local carriers can make it easier to get orders out without unnecessary empty hauls.
- Informed RFPs – capitalizing on optimized negotiations improves relationships and strengthens contractual agreements.
- Fewer Errors – by unifying data from all systems, shippers can quickly maximize profits and control transportation spending.
- Faster Payment Processing – by capturing data from all resources, shippers can pre-audit invoices and pre-authorize payment to shorten the payment clock for carriers and build better, stronger relationships too.
Enable Strategic Transportation Spend Management With Intelligent Audit
The growth of e-commerce has continued to directly impact the shipping industry, which in turn influences the focus and direction of the FAP services industry. With more consumers buying online, a growing portion of shipments is small parcels. Freight bill audits and payment service providers can capture and leverage this information. Contact Intelligent Audit today to learn more about the strategic transportation spend management services available to shippers and how a data-driven approach that can compile data, normalize it, derive insights and help teams do more with less will carry your organization into the next frontier.