Inbound Logistics | June 2022

nterest in freight bill audit and payment (FBAP) providers has gained momentum in recent years as the demand for experts to manage transactions between shippers and carriers grows. FBAP providers can help shippers contend with complex transportation processes, while also bringing fresh tools and expertise that can add strategic value to shipper operations.

“The cost/benet and value proposition are benecial from a purely economical perspective,” says Allan J. Miner, president of Cleveland-based CT Logistics. “A freight bill and audit payment provider can perform the required steps—if they are ISO [International Organization of Standardization] and SOC [System and Organization Controls] certied— at a fraction of the cost than a shipper’s internal accounts payable department trying to audit, pay, and accrue the open liabilities until payment is effectuated.” Large, complex companies—including those that are decentralized and have a global presence—are obvious candidates for using a provider because they have “a lot of moving parts and different business groups and regions to consider,” says Jeff Carlson, vice president, global sales and marketing, for St. Louis-based Cass Information Systems. The right FBAP provider not only gives those businesses a more efcient process, but also provides better data about their freight payment transactions that they can use for improved planning, he adds. Meanwhile, shippers should partner with a freight bill audit and payment provider when their annual freight spend exceeds $10 million. “Carriers consistently invoice 3-5% of your total transportation spend incorrectly,” Miller says. “If you’re not auditing every charge on each invoice, or if you don’t have visibility to your shipment level globally, then you’re leaving money on the table.” Here are practical tips for choosing the right FBAP provider for your company.

The freight bill audit and payment market has exploded in recent years and includes providers with diverse service offerings. “The majority of players in the freight bill audit and payment space provide niche services that focus on one or two transportation modes,” says Josh Miller, vice president of sales for Memphis-based CTSI-Global. “The level of technology and the support model can vary signicantly from provider to provider. “It’s important for shippers to choose the freight audit provider that best meets their specic needs, both from a technical and support perspective,” he adds. “Not all freight audit and payment companies are alike.” For shippers, the question becomes how to navigate the market of FBAP providers and identify the partner who is the best t for their operation.

Opinions vary about the categories of shippers that are clear candidates for enlisting an FBAP provider. In general, an FBAP provider makes sense for many types of shippers. “Shippers with a modest and diversied transportation spend can and should consider using the services of an FBAP provider because their support extends beyond logistics activities— they support nancial teams as well,” says Scott Matthews, president, freight audit and payment, AFS Logistics, based in Shreveport, Louisiana. “They are specialized and equipped with the operating systems to perform these services at signicantly less expense than performing them internally.” Companies with $500,000 in freight spend, not including parcel, should consider enlisting outside help.

Technology solutions are a crucial factor to consider when choosing a freight payment and audit provider. For example, Cass Information Systems oers CassPort, a customizable portal that provides options for selecting and displaying data.

28 Inbound Logistics • June 2022

Powered by