Saving money on transportation costs has always been a frequent topic of discussion for companies, but recently, it’s been exceptionally top of mind for supply chain executives. Many organizations are looking to control costs; therefore, CFOs and CEOs are looking for unique solutions, such as freight audits, to help lower transportation spending.
Our transportation experts understand that companies can’t stop shipping to lower costs. That said, one of the most effective ways to control logistics costs is to stop overpaying carriers by conducting thorough audits of all freight bills. While this may sound simple in concept, auditing freight bills takes tremendous time for internal transportation and accounting teams.
Internal resources are stretched thin and taking on more responsibility than ever. It’s become commonplace for companies to allow the auditing of freight bills to fall onto the back burner as other operational tasks take precedence. With limited resources, many supply chain teams are looking at alternatives, including outsourcing freight audits. As companies look to limit costs, here are some of the key ways freight audit can help teams control costs:
What does the optimal freight audit and pay process look like? How does outsourcing providers add value? Here’s a quick breakdown:
In addition to streamlining the process, having a dedicated team to scrutinize each freight bill can save thousands of dollars each year. Freight audit companies compare every carrier invoice to the negotiated contract, bill of lading, as well as any additional documentation to ensure that the below details, at the very least, are accurate. Here are the most common incorrect charges auditors find:
Our team goes one step further by providing each freight audit client access to our robust PEAK technology to optimize transportation decision-making and centralize document storage, minimizing the time it takes to process a shipment and conduct an audit.
By consolidating transportation activities within the freight audit software and coupling them with the expertise of trained audit professionals, we typically help clients save 4-8% annually on their LTL transportation spend through the audit process alone.
Capturing an invoicing error is just the first step. Disputing and correcting a bill with the carrier is yet another headache. Outsourced freight auditors act as liaisons, working directly with Pricing and Accounts Receivable teams across national and regional carriers to follow through on each incorrect invoice and ensure that operating systems have updated information. This process saves the client time, not only in the initial carrier dispute process but also down the road when carriers tend to incorrectly follow up on what they show as an overdue or underpaid invoice.
Another benefit of Ascent’s freight audit approach is that the invoice dispute communication and resolution backup documents are always accessible and searchable under the shipment for future retrieval or reference.
Freight audit companies typically consolidate all audited invoices into one weekly packet containing the pre-audited invoices and a consolidated line-item invoice. This consolidation helps internal teams handle freight payments in one streamlined approach instead of managing each ad-hoc. It also helps internal teams have confidence that the payments being sent to carriers are accurate and validated.
Clients that have multiple locations nationwide, various terms based on the vendor or the customer and ship with more than three LTL carriers typically find the most value in outsourcing their freight audit and pay. If these characteristics represent your business, you could be attempting to audit hundreds of invoices per week based on various business rules and contracts.
Let us save you time and money. With years of experience and robust software, Ascent helps clients save between 4-8% annually on LTL shipping through our robust freight audit solutions. Contact our team to learn more about our Domestic, International and On-Demand solutions.