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What is Freight Audit and how can it help me save money?

There's more than one way to skin a cat when looking at controlling logistics costs and optimizing transportation management. Carefully controlling your shipping invoices is one of those methods, whether it's during the pre or post activities of your freight shipping.

By conducting consistent audits, you will rule out overbilling, be capable of selecting the most efficient carriers, gain strength in future rate negotiations and overall, choose the best transportation strategy for your company. For many companies, outsourcing could be the most economical way to properly audit and process freight invoices.

Not only Fortune 500 companies with freight budgets ranging from 100 million to 1 billion EURO are typically interested in freight audit services , but also companies with a freight budget of 5 million EURO and up now start to realize the that there is money to be saved in logistics via freight audit outsourcing services.

Also according research of inboundlogistics.com, freight costs can make up 10% of an organization’s expenditure. As a consequence of rising freight costs, an increasing number of organizations has been more pro-active in controlling freight cost and have outsourced the freight auditing process to freight audit specialists.

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What is Freight Audit and how can it help me save money?

  1. 1. CONTROLPAY PRESENTS What is Freight Audit? How does it save me money? Ipsum Dolor Sit Amet 2015 Ipsum Dolor Sit Amet, possit scitic praesenti perdidream vestes. Lorem Ipsum Reduction of freight cost by 3-8% Full-time employment savings On-time payment Freight Audit is the process of examining and verifying freight bills for accuracy *A freight bill is an invoice from a Logistics Service provider to a Shipper. What are the (hidden) benefits? Cost Allocation & Coding Putting Shipper in control of administrative processes Creating unified and efficient processes Visibility (costs, shipments, contracts and the process) Centralization and standardization of data Reduction of paper One data source for different departments (Sourcing, Finance, Operations) Elimination of wrong billing Disconnection between shipment details and actual invoiced amounts as they are not managed through the same platform. A Freight Audit provider does make that connection. This leads to advanced analysis capabilities Results of working with an outsourced provider Why is a Freight Audit provider needed? - Duplication - Different invoices for the same shipment Carriers have a wide variety of 'additional' costs Limit time horizon for loading/unloading: Demurrage Business rules: Taking the highest of agreement rulesFuel Surcharge (Un-announced ) update of rate tables Errors in invoices Adding costs, conditions or rules after tender-process Did you know In Europe there are only around 5 companies that provide Freight Audit services on a European and global scale. Carrier errors are difficult to identify and moreover, the recovery process is very labor intensive. International complexities in logistics are driving the need to have a freight auditor. Also the lack of visibility, the need for control, cost savings and the need to pay carriers on time are motives for freight invoice auditing. No alignment between the sourcing team, the operations team and the finance team could lead to wrong invoicing slipping through.

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