Auditing and paying small parcel carriers can be a complex and time-consuming process for businesses. However, companies like Transportation Insight have paved the way since the late '90s in developing comprehensive freight and parcel audit processes.
When considering small parcel audit, it is more complex than “does what I was billed match the service level I received”. An auditor must consider contract terms, discounts, volume tier incentives and applicability of all surcharges and fees.
By having a multi-faceted advanced audit, you ensure accuracy, efficiency and cost savings. Parcel auditors can help companies not only receive refunds for fees erroneously charged, but auditors can also aid shippers in determining the root cause of errors to mitigate ongoing surcharges. There are a few considerations you need to know about auditing and what to look for when choosing a company to audit your carrier invoices,
When our small parcel team begins an audit, we are looking at three main categories: invoice audits, service audits and compliance audits. This comprehensive approach ensures that all rating errors are identified, refunds are requested, and clarification is provided to carriers on behalf of the client. It also ensures you aren’t leaving money on the table.
What most people think about when they think about auditing in the truest sense is rate auditing and/or invoice auditing. Rate errors can significantly impact shipping costs. Transportation Insight’s systems and team of auditors commonly identify rate errors due to shipping account numbers not being tied accurately to contracts or discount incentives not received correctly due to inaccurate tier assignments that total hundreds of thousands of dollars.
In addition to invoice audits, there are service audits. Service audits focus on evaluating guaranteed service levels, Saturday pickup and delivery, early AM services and more. Many shippers have stopped tracking service performance due to carriers waiving guarantees since the pandemic or removing them to earn better pricing. Transportation Insight still tracks each package because customer experience is still important and having carrier performance results helps negotiations in future carrier conversations.
Lastly, we perform compliance audits to ensure third-party compliance, routing guidelines, weight variance and other important shipping behaviors. These audits help businesses optimize their shipping processes, eliminate transportation expenses, and maintain compliance.
Bonus: Claims & Payment
Another overlooked component is claims resolution. Claims continue to be an element for any parcel shipper, so understanding the claims resolution process, and taking advantage of a provider that does all the heavy lifting is extremely beneficial.
Paying small parcel carriers may seem simple but application of funds across ten, one hundred or even thousands of account numbers can be difficult to manage. Also, lack of visibility into what packages have been invoiced and what costs are outstanding can lead to inaccurate forecasting. Auditors should be able to provide visibility to estimated costs as packages are manifested, taking into consideration package characteristics, origin, destination and residential versus commercial surcharges. This will allow you to perform in-day cost accrual and provide quick turnaround for financial inquiries.
Auditing your parcel carriers is the first step to understanding potential opportunities but remember ensuring an accurate audit goes beyond what I was billed vs. what I received.
Shameless plug: For more information on how Transportation Insight ensures accurate billing, identifies cost-saving opportunities, and helps businesses maintain compliance contact us.
