Modern supply chains are under increasing pressure to cut costs and improve customer service levels. Traditional linear supply chains were relatively simple in execution: moving products from the manufacturer to end-user. Now, supply chains are increasingly complex, reflecting a circular supply chain, bending at countless angles, and meeting the demands of omnichannel and e-commerce. Meanwhile, freight bill auditing is growing more accessible and more affordable, not to mention automated notes Inbound Logistics. Auditing is a new best practice for the modern shipper, and failure to implement a program will only lead to higher freight spend. Unfortunately, such complexity contributes to higher freight spend, and all too often, carriers and logistics service providers may make mistakes in invoicing. However, a freight bill auditing program can isolate these problems and recover lost revenue.
Not conducting a freight bill auditing program might seem like a more straightforward solution. After all, freight spend is inevitable. Moreover, today’s consumers expect fast, free shipping. This leads to the assumption that the current freight spend will rise unimpeded. Yet, errors continue to occur. Carriers may double bill invoices, bill for incorrect classification of freight, and even assess extra fees for inaccurate weights. While shippers may have a paper trail of shipment data, arguing with a carrier over billed charges can seem useless. After all, shippers cannot fulfill customer orders without the carrier. The reality is simple; carriers know these problems exist. Much of the errors can be traced back to human mistakes, and carriers have developed entire processes to handle invoicing errors. Of course, it is up to the shipper to identify such problems.
Freight bill auditing is a complex process that allows shippers to recover lost revenue deriving from errors and inaccuracies within freight invoicing. A robust auditing program must go line by line within the freight invoice in shipment details to ensure the invoice aligns with the original shipment data. While shippers may make mistakes when classifying or otherwise tendering a shipment, the majority of data remains valid. As a result, auditing freight invoices means looking beyond data gathered by both the carrier and the shipper to identify potential problems and submit chargebacks. The key to making freight carrier invoice auditing successful lies in ensuring the money spent on an auditing program does not exceed the revenue recovered.
To keep freight bill auditing under control, shippers should follow these best practices.
Shippers that do not implement a freight bill auditing program are losing money. Statistically, an error will occur at least once per day, and that assumes shippers only move 36,000 units per day. Instead of leaving money on the table, invest in dedicated freight bill auditing services, as well as an advanced TMS, to recover lost revenue, and keep your invoices on track and accurate.
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