SPECIAL ADVERTISING SUPPLEMENT FREIGHT PAYMENT SERVICES: BOOSTIING INVOICE IQ
SHIPPERS TAKE MATTERS INTO THEIR OWN HANDS
Freight auditing and payment products are available to streamline and automate the processes via EDI invoicing and auto-rating carrier invoices. Many of these products are marketed by FBAP service providers who already have carrier rating, EDI, and information processing expertise. These products allow shippers to audit freight invoices, pay carriers, and analyze and report logistics information with minimal manual intervention. They typically offer the following features: Ability to accept EDI invoices from carriers. ■ This is critical to reducing processing costs by eliminating extensive data entry of hard-copy bills. Auto-rating of carrier invoices. ■ These programs have carrier rates built into a rating engine. As the freight bills are processed, they are compared to the shipper’s contract rates and overcharges are identified.
While many shippers are outsourcing FBAP, others choose to take advantage of an alternative solution: insourcing the activity. Companies choose this route to maintain control of the coding and payment functions, or to avoid transferring funds to an outside vendor for carrier payment. In-house processing assumes a certain level of expertise and requires the shipper to invest both time and resources. If bills will be processed manually, shippers have to ensure there is someone on staff with the technical knowledge to perform a satisfactory audit. And if capturing data from the invoices and bills of lading is important, the company will need data entry personnel. Automating the in-house process also requires a substantial commitment of time and resources to set up and maintain these procedures. EDI has to be implemented to receive invoice data from carriers. And a rating program has to be developed to automatically audit freight invoices from high-volume carriers.
Services. ■ This includes responsibili- ties the shipper expects such as pre-audit, bill payment, data capture, and report- ing. Internet service can also be outlined in this section. Contract term. ■ Termination privileges should be outlined. Confidentiality clause. ■ Consider a for- mal ethics policy, or at least a code of ethics, to ensure that valuable informa- tion will not be divulged. Next, agree on what the FBAP ser- vice provider will charge your business. Certainly, the partnership will not last long if both sides cannot agree on a fee schedule. While each provider will have its own formula, a shipper can expect to incur an implementation fee, which covers the cost of FBAP personnel visit- ing your site to develop specifications; loading rates into the provider’s systems; customized programming; loading refer- ence files; and other start-up activities. In addition, charges for pre-auditing, processing, and payment of each indi- vidual bill could be included. And while certain reports will be provided at no
from the arrangement and will yield smoother transactions. “Both sides must view this as a part- nership or the relationship will not take hold,” says Snavely.
While each service agreement will vary in length and content, at a mini- mum it should provide the following: Preliminary statements. ■ Define the parties involved and their intentions.
Customized Management Reporting 24/7 WEB Based Data Visibility Pre and Post Audit Service 100% EDI Capable
Freight Bill Audit and Payment Large Company Capabilities with Small Company Service After 40 Years Customer Service remains our priority!
800-526-3972 www.TransVantage.com
106 Inbound Logistics • September 2009
FACING LOGISTICS CHALLENGES? USE IL’S 3PL EXPERTS AND
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