On average, a small to medium sized business will spend 10-12% of their annual revenue on freight brokerage costs. Furthermore, 9% of those freight invoices will contain discrepancies. Freight spend, as a percentage of sales, drops by nearly 50% with the implementation of a strong supply chain strategy. If high freight spend is a problem for your business, how do you take control? First, take a close look at your current freight spend data within your company. Is there enough data available to help you to identify your high cost issue? Based on that data, are you able to make a good recommendation for a corrective action to reduce your freight spend? If you answered no to either of those questions, it’s time you need some help. Start off by bringing on a Freight Audit & Pay company. Here are some reasons why:
Carrier invoice charges are confusing from time to time:
Did you know that one out of four freight invoices have errors? A Freight Audit & Pay company can help you understand these charges. They are the experts with freight shipping terminology, and will work with the carrier to make sure invoice billing is correct. Carriers make mistakes and it is hard for someone to catch all these mistakes. The Freight Audit & Pay company will catch them for you and give you the assurance in knowing that you are saving money by having them there to catch these mistakes.
Freight Audit & Pay companies collect and store data:
These companies will keep your invoice and payment data on file to use for reporting and other needs. This data will help you identify your high cost areas. Perhaps you have a high cost ship lane that requires more competitive pricing or you’re being overcharged on detention without your knowledge. Maybe there are errors on your Bill of Ladings that are causing additional charges. These are only a few of the types of issues your freight audit & pay company can help you identify and resolve.
Staffing your office for your freight invoice payment workload:
Auditing freight bills can be tedious and time consuming. By letting a Freight Audit & Pay company audit your carrier invoices for you, it will allow you to use your staff in other areas of your company. The Freight Audit & Pay company collects data while auditing your invoices. This collection of data allows them to make recommendations on improvements with your shipping if needed to help you further save money. They become your business partner with the same goals in mind as you, saving money on freight cost.
Having trouble paying your freight carriers on time?
We know freight audit companies can do the freight audit task, but some also handle the carrier payment process too. This takes the burden of paying the carrier on time away from you. You can let the Freight Audit & Pay company do this task for you and they will communicate back to you what is being paid before the payment has been made. This way you both are on the same page and it will give you the comfort in knowing that these invoices are being paid in a timely manner. It will free up valuable Accounts Payable time that you can use to fulfill other value-added services.
Which Freight Audit & Payment company should I use?
A lot of Freight Audit & Pay companies want you to fit into their business model, but I have found that the smaller Freight Audit and Pay companies can adapt to meet a client’s needs better. With their company size being smaller makes them nimbler and that gives them the flexibility to come up with a process that works best for you.
Freight Audit & Pay Company, Outsourced work or in-house work?
Companies have found that it is better to work with a Freight Audit & Pay company that does their auditing and freight payment process in-house. To outsource these tasks could result with delayed response to your questions and needs.
Want to learn more about how The FSL Group can help you save money on your freight invoices? Start your free trial today!
