Three Benefits to Automating Your Freight Invoice Audit Process
Three Benefits to Automating Your Freight Invoice Audit Process
Reduce Freight Costs:
First off - the reality is a lot of freight invoices are incorrect, so they all should be checked. Mileage calculation errors are common and the complexity of fuel surcharge matricesmean that the applicable surcharge changes week to week. Do a spot check of some invoices and I can promise the wrong surcharge is getting applied on some shipments. Partnering with aresource to help automate this auditing process will make it simple for you. Most freight invoice auditors will claim a freight savings of 2-6% off your logistics spend. I can't verify that either way, but I do agree an opportunity for savings exists. On the high end, you should expect to pay $.80-.85 per invoice, but much less with higher volumes of invoices or using EDI to facilitate the process. This would involve getting each of your carriers to interface electronically with the freight payment company. This is a bit complicated to get started with but will become relatively simple to maintain once the whole process is in place. A Transportation Management System can help manage the process.
Reduced Shipping Administrative Expenses:
Companies conducting their freightinvoice audit in-house are usingexpensive employee resources to ensure carrier invoices are correct - and probably not very effectively.Realistically, amanual freight audit is not able to uncover the same number of carrier audit billing errors and shipping service failures thatan automatedfreightinvoice auditprocess is able to identify.Automating the invoice audit processwill eliminatethe excessive timecurrently allocated to these tasks and as a result generate additional cost reduction in time saved. Think about it how are your carrier rates sheets organized right now? Hardcopy print outs in a drawer? Maybe a spreadsheet attached to an email in someone's inbox? How efficient or accurate is it for someone to be auditing each carrier's invoice by referencing one of those sheets, running the miles, adding stop charges, and accesorials and doing it correctly? Plus they need to check this week's fuel surcharge from the DOE website, reference yet another table provided by the carrier, and add that amount to the carrier charge. You do all this for one truckload, when you can automate the process in a way that eliminates the work and the potential errors.
Freight Management & Carrier Reporting:
From a business management standpoint, this is the possibly the most valuable benefit of automating freight invoice audit. Information. The importance ofknowing all your freight data isaccurate andaccessibleallows for effective business reporting and use of that data. Understanding your logistics and supply chain costs in detail is vital toeffectively runninga business. Attempting to manually audit and collect freight data is too time consuming and very error prone. Think about the valuable components of freight spend data. The better you understand the cost components that make up your freight spend, the better you manage your business. If you keep getting hit with detention a particular consignee you what to know about if freight costs are going up because of fuel, you want to know about that too. Good information is vital to making your business run better.