October 20188 logisticstechoutlook.comDoes your shipping department regularly audit its freight bills? Research from Texas A&M suggests that more than 80 percent of shippers overpay for their freight. Without regular freight auditing, the volume of overpaid or fraudulent bills can become unmanageable. This leads shippers and supply chain executives to utilize the capabilities and resources of a third-party logistics (3PL) provider, or beyond that, a logistics solutions provider (LSP).Carrier mistakes are challenging to identify and can be time consuming to deal with, but an LSP that provides freight audit and recovery services will do the grunt work of examining, adjusting and verifying freight bills for accuracy. When done correctly, this exercise has not only been proven to recover significant funds--often hundreds of thousands of dollars--but also provides the intelligence needed to mitigate carrier mistakes in the future to save money year over year. More than that, freight audit programs that utilize the intelligence of a transportation management system (TMS) empower companies with end-to-end supply chain visibility and the ability to proactively conduct business and manage carrier relationships.How LSPs Conduct Freight Audit and RecoveryWith shipping charges making up approximately ten percent of a company's total expenses and establishing a host of variables from base rates and discounts to fuel surcharges and accessorial charges, regular freight auditing is an enormous task for in-house accounts payable departments to tackle. In fact, for companies with multiple locations and without a TMS to enable enterprise-wide visibility, fully monitoring freight expenses and exposure is almost impossible.By Scott McDevitt, President & CEO, TranslogisticsFreight Audit and Recovery: The Secret to a Smart Supply ChainIn My OPINION
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