Tracking and auditing freight invoices can be a complicated process. After all, when done manually, the time and attention to detail required are immense. This is especially true when the number of clients and shipments rises into the hundreds or thousands and the pile of invoices becomes too huge for the accounting team to handle.
But as a company scales, billing inconsistencies can happen increasingly often—and failing to identify them can be incredibly detrimental to the business.
Freight invoice auditing is an essential step that far too many companies skip over. Here’s how to do it efficiently—and why every company should.
Why audit freight invoices?
There’s a lot that can go wrong with an invoice. The carrier may forget to include an agreed-upon discount, or simply do the math wrong. The product class may be incorrectly billed. And if an invoice is accidentally duplicated, as they so often are, the shipper may find themselves paying for the same shipment twice.
Failing to detect such mistakes is an easy way to let money slide out of the door and tighten already razor-thin margins. By auditing each and every freight invoice, companies can ensure they’re not paying a dime more than they should in shipping charges.
For those that haven’t invoiced before or that have done so inconsistently, the immediate return on investment can be startling. Not only can auditing put money back in the bottom line where it belongs, but it can provide a wealth of data into a company’s shipping costs that can lead to further savings down the line. Shippers can use this information to negotiate better rates from their carriers, gain a better understanding of their freight spend, and more.
Why don’t more companies audit their freight invoices?
Unfortunately, it’s nearly impossible to catch invoice errors without conducting regular and robust auditing. But for companies shipping at even a moderately high volume, taking a closer look often requires hours and hours of staff time.
For one thing, a good deal of invoicing is done on paper. Paper invoices not only take significantly more time to create and send, but increase the likelihood of human error and are harder to keep track of once they’re filed away. Accessing records when a problem arises can mean sifting through stacks of old and irrelevant documents—and often failing to find the ones that are needed. Add to that the aggravation of spending hours pouring over paperwork and it’s clear why some companies just swallow the costs and hope for the best.
But freight invoice auditing doesn’t have to be the worst part of the AP team’s day. Nor does it have to be the thing that everyone quietly agrees to forget about. With the right tools, companies can make auditing a regular and easy part of their workflow—reaping all the benefits without experiencing any of the drawbacks.
How can companies audit at scale?
The first step toward a more scalable, streamlined auditing system is abandoning the paper invoice. Going paperless allows companies to quickly and easily access contracts and invoices, capture data, obtain proofs of delivery, and more.
With all this information available at the click of a button, detecting mistakes gets a whole lot easier. But companies can further simplify their lives, improve the accuracy of their payments, and maximize savings by embracing automated auditing.
Why leave money on the table?
Digital invoicing combined with automated auditing processes enable companies to capture virtually all errors, big or small. Whether it’s identifying an incorrect product classification, spotting an overcharge, or making a payment on time, automation can significantly reduce errors and speed up processing, while relieving the burden on staff.
CTSI-Global’s industry-leading freight audit and payment services can help companies put countless dollars back into their bottom line. It costs shippers an average of $5 to process and pay a freight invoice. Companies that partner with us pay a fraction of that cost.
Don’t waste time and money. Contact us today.