Digital Edition

Nov.30, 2015

Issue link: https://jocdigital.uberflip.com/i/605337

Contents of this Issue

Navigation

Page 37 of 63

38 THE JOURNAL OF COMMERCE www.joc.com NOVEMBER 30.2015 FREIGHT PAYMENT SPECIAL REPORT MAXIMIZING TECHNOLOGY'S VALUE What are the keys to getting the greatest benefits from freight-audit tools? According to a report by U.S. Bank, best practices for maximizing the value of these tools include: MAXIMIZING THE USE OF ELECTRONIC INVOICING: Logistics and trans- portation companies have a long wish list of projects on their agenda, so it's easy for some companies to argue that other kinds of initiatives deserve their highest priority. "But the initiative to move carriers to transmission of invoices and related documentation via EDI or other form of electronic invoicing is a project that should make the top of that list," the report said. The benefits of such initiatives "are far-reaching and will quickly show a payback. In addition to achieving immediate process improvements, auto- mated invoice receipt also sets the stage for improved outcomes throughout the rest of the process and beyond." INVESTING IN A HIGHLY DEVELOPED MATCH PAY SYSTEM: "Match pay" refers to the process of validating freight movements by matching invoice files to shipment files. Match pay systems also provide tighter processing controls, better quality and increased volumes of data, and expanded options for cost allocation at various levels. According to U.S. Bank, a match pay system also should offer tightly controlled, rules-based processes to audit and account for different and sometimes complex scenar- ios — for example, handling pool shipments, stop-offs, milk runs, intermodal shipments and a variety of industry-specific movement types. This, along with the ability to process multiple invoices against a single shipment (for situations such as balance dues or separately billed assessorial fees), will result in fewer exceptions as well as an increased ability to understand total cost for multiple-invoice shipments. Match pay systems are so useful because they use more sources of data than non-match pay systems. Greater possibilities, therefore, are created within the realm of business intelligence. Product data, for example, may be unnecessary for audit purposes but can be valuable when captured for reporting and analytics purposes. Moreover, "tremendous advancements in ERP and TMS systems in recent years have enabled parallel advancements in match pay systems. As shippers gain unprecedented control over their supply chains and transportation expense, they are building match pay solutions to handle more than just outbound shipments." ACTIVELY MANAGING YOUR FREIGHT RATING SYSTEM. Freight agree- ments need to be auditable, clearly and completely stating how freight charges are to be calculated. For example, if rates or assessorials are on a per-mile basis, the agreement should state the mileage source, version and any parameters that may apply (trailer length, for example). GATHERING ACCURATE AND COMPLETE SHIPMENT INFORMATION. This can also be difficult. If pricing is dependent on certain equipment, for example, then the shipment details sent into the rating system need to include equipment information. The ability to upload contract data will streamline the rate loading and rate maintenance process. — Alan M. Field For the time being, demand for freight payment audit software seems to be growing faster outside the U.S. than inside its borders, Miner said. "We are getting huge traction outside the United States," he said, noting CT's sales are increasing at double-digit rates in foreign markets, but at a much lower pace within the U.S. To address growing demand overseas, freight audit software available in the U.S. is increasingly globalized in content, and tar- geted at companies that do business across borders. CT's FreitRater audits bills in various currencies and languages, while converting measurements in and out of the American and metric systems. "The percentage of our business outside the U.S. is still less than 25 percent (of our total), but it is growing at double-digit rate — over 10 percent annually, whereas the U.S. growth rate is only 2 or 3 percent," Miner noted. Like U.S. Bank, New York-based Citi pro- vides a full-fledged service that reconciles data and provides electronic visibility to ship- pers and carriers in the U.S. and abroad via an electronic portal. The system facilitates the audit, approval and payment of freight- related expenses by automating data supplied by every supply chain process. Everything takes place online, from pre-payment audits to review and negotiation with shippers to expense allocation and more. U.S. Bank, meanwhile, has expanded its freight payment services to Europe, where it offers the continent's first trade finance ser- vice specifically geared to freight. Elavon, a division of U.S. Bank's Corporate Payments division, now gives its users greater visibility into their global transportation spend and more complete, timelier data with which to make business decisions. In addition to improving processing efficiencies for European shipping opera- tions, the system reduces costs by automat- ing manual processing and optimizing c ash flow. The new trade finance capability enhances a suite of recent enhancements to Elavon Freight Payment that ref lect Europe's diverse business, legal and regula- tory environments. The offering provides an automated solu- tion for some of Europe's most labor-intensive freight-payment processing needs, including VAT support and consolidated invoice pro- cessing. JOC Contact Alan M. Field at alanfield0@gmail.com.

Articles in this issue

Links on this page

Archives of this issue

view archives of Digital Edition - Nov.30, 2015