Are your carriers forced to invoice 1 shipment per invoice because your Freight Audit provider cannot consolidate shipments? Non-consolidation means that you are losing money or you need to create workarounds to calculate it correctly. Time to stop undermining the true benefits of freight invoice automation…
The above described is a regular returning issue for many companies, often because of 2 simple reasons. First, companies don't audit their freight invoices or have a low-end freight invoice solution in-house. As such, there is a chance of a slight disconnection between the logistics / transportation department and the financial management team, responsible for the accounting of shipments.
This gap means that there is an interrupted communication between the controller(s) (CFO) and the logistics department responsible for the set-up and coordination, who are less likely to focus on freight accounting management, which simply causes a less efficient invoice process, causing the risk that companies are missing out on some serious savings.
The second reason, companies are working with 3PL’s / freight audit providers that don’t offer consolidation of freight invoices. These companies are not strategic about freight audit and logistics data and will leave serious money on the table, just like their colleagues who audit their invoices in-house.
What is the Consolidated of Freight Invoices?
One invoice for all items one vendor ships over a certain number of days, regardless of the number of shipments or purchase orders, providing the benefits of reducing the time, paper, and costs required for individual shipment invoicing.
Companies that aren’t consolidating freight invoices, receive for every single parcel package, load or LTL transport a different stack of paperwork. Imagine working with 50 different carriers for all modes of transportation...you guessed it right, within no time your financial department looks more like a paper factory. But complications don’t stop just there yet.
Because of the fact that every carrier uses a unique, paper invoice format and billing cycle, the accounting process grows even more complex and confusing, causing big trouble to already complex freight accounting and invoicing process.
Consolidating your freight invoice will streamline this process, for both the logistics as for the finance department. Shippers will receive just one weekly electronic invoice that consolidates all global transportation vendor billing and freight invoices for the previous week. No matter the amount of carrier you work with. In combination with a TMS (Transportation management system) and /or financial system, freight invoice consolidation sweeps all the manual work of accounts payable of the table.
This allows the logistics department AND the financial department to have pro-active and value-added meetings, bringing all freight activity and its detailed components on the table. Understanding full freight details in one clear and uncluttered weekly report for the most efficient transportation management and the largest cost-savings.
The added value of freight invoice consolidation for your organization
- 24/7 insights in your freight invoices, consolidated via a web-based platform, in your Transportation Management system.
- Full visibility with standardized audit format
- With clear and correct data of your full operation at your finger tips you do not only manage the business better, but you can also do better benchmarking, better tendering and carrier selection. Clear shipment profiles, deep analysis on costs per lane, carrier, per shipment, per invoice, per origin and per customer etc. will make you the strongest negotiation partner on the table.
- Reduction of paperwork, invoices and FTE-time handling accounts payable processing
- Automated and correct cost allocation
When outsourcing freight audit, the big focus is often on achieving cost savings on freight spend. Therefore, make sure your carrier does the correct shipment consolidation of your LTL, parcel and Air shipments.
ControlPay — and freight invoice consolidation
ControlPay does it fully automated and works with consolidated bulk invoices as well. The price calculation and the automated cost allocation are directly returning back into your financial system, so there is a minimum of work on all sides. This way your freight audit & payment is efficient, transparent and highly automated.
Besides the electronic invoice you receive on a weekly basis, a data file containing all shipment details (invoice number and date, freight details, service levels, invoice entity, etc.) will be delivered to have a powerful overview on transportation.