Inbound Logistics | June 2022

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First and foremost, a provider must be able to manage basic “blocking and tackling” responsibilities, such as taking in freight bills, but he says shippers, especially large ones, should be looking for what other products and services providers have to offer. “Can a provider do claims management, for instance, or do they have a program that will help facilitate a working capital goal of extending payment terms out, but not in a way that hurts carriers?” Carlson says. “It’s a question of identifying value points. “Freight payment is a relatively commoditized business,” he notes. “It’s the other services—such as consulting and expertise—that can help a business grow.” Ask an array of key questions during the selection process. Shippers considering providers will want to ask about their IT infrastructure and the security protocols that protect the shipper’s data, Miner says. A provider should have full-time, in-house IT staff and experienced freight auditors for all relevant modes of transportation, among other considerations.

When choosing an FBAP provider, shippers should consider the expertise and experience of a provider’s team. The professionals at CT Logistics have served the market for 99 years.

Meet with the provider’s principals and the key staff supporting their operations. “If you’re going to make an investment in a relationship, get to know people before you sign a contract,” Carlson says. “There’s no business relationship where everything goes perfectly. When a problem does pop up, can you work together as a team to resolve the problem and move forward? That’s a big piece of it.”

Freight payment providers deliver the most value for clients who have been up and running for a while through data analytics.” Selecting the provider with the lowest fees could lead to higher costs down the road through higher freight spending than would occur with a provider with higher fees who is more adept at catching overcharges and mischarges. “Securing a quality service has a marked difference in cost over a bargain service, but price is only part of the overall picture,” Matthews says. Similarly, Carlson warns against turning the search for a provider into “a pure procurement exercise looking for the lowest cost,” particularly for large, complex enterprises. “The lowest cost is not always the best, because the question becomes, ‘What am I losing in terms of value?’” Carlson says. “Also, the more efficient and experienced the FBAP, the less your own resources will still need to be involved. That’s very big for shippers.” Transparency is a critical must-have, and one that shippers should be clear will be part of any provider relationship. “FBAP providers must offer transparency into data and processes and have the trust of all parties— shippers and their carrier network,” Matthews says. “All parties involved should work to accelerate the velocity of the payment process and eliminate errors resulting in inaccurate information and overcharges. “The objective,” he adds, “is to get freight bill payment and audit done right and expeditiously.” n

Tech-based tools and how they can serve shippers are also important considerations.

“The real thrust of FBAP business today is actionable information that shippers receive via the web or create from their FBAP provider’s website with ad hoc reports,” Miner says. Even so, providers must prove their tech capabilities. “It’s important that the freight audit and payment provider demonstrate their commitment to technology,” Miller says. “Do they offer a modern, feature- rich platform? Do they offer a robust reporting package with dashboard analytics? Do they offer additional capabilities, such as a transportation management system, that can drive additional value?” Providers must demonstrate they are investing in technology with an eye not only on the present but also on the future. “Are FBAP providers investing in technology not only for today but for the next three to five years?” Carlson asks. “How well do they understand it?

Client tenure is a positive sign. “Being in this business for years

and having tenured clients are good indicators that the provider is worthy of closer consideration,” Matthews says. Ask for a list of references specific to your industry and geographic region, and poll your carriers . “A lot of trucking companies have dealt with multiple providers, and they can probably feed you open and accurate information—at least from their viewpoint—about a provider you are considering,” Carlson says. Investigate the length of service among team members, including the senior management team. “Is there high employee turnover?” Carlson says. “What is the length of experience at that company? If they are churning through a lot of people within a year or two, it could be a sign of other issues.”

32 Inbound Logistics • June 2022

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