A chapter in our freight procurement best practices series, how to reduce your administrative workload.
For most companies, dealing with spot-buy freight means a lot of manual work, emails, spreadsheets and paperwork. A jungle of information scattered all over the place, creating the perfect storm for costly errors and unnecessary spending There are many ways to reduce the cumbersome effort and improve this process, not only during the quoting phase but also when the actual shipment is moving.
Regular shipments will be tracked by either an ERP or other internal system. Spot-buy freight is mostly tracked by email, through tracking numbers on provider portals or carriers and airlines. If you want to know the status of your shipment you have to be proactive as most providers are not set up to give you real-time updates or update you if something has gone wrong, and looking at 17 tracking systems to manage all your systems is not a very motivating task.
In the past few years, many companies including logistics providers have worked on improving the way shippers can track shipments by developing new platforms that support API’s. This allows platforms like Cargobase to connect and automatically feed shipment updates into a centralized dashboard. A dashboard that also allows shipper and logistics providers to chat and share documents such as invoices, packing lists, customs docs, etc. This dashboard can be shared among stakeholders, who can access the data, be updated by email, and collaborate. Think of sales, suppliers, customers, customs brokers or even management and business partners. This does not only reduce the number of emails, but it also creates a single source-of-truth as an audit trail for auditing and compliance purposes. All data is available in an archive and accessible when needed.
Another administrative nightmare for both shippers and logistics providers is the invoicing of spot-buy freight shipments. Invoices for spot-buy freight fall outside the regular flow of invoice processing so more often than not: nobody really knows what information to provide or where to find it.
Most freight audit and payment companies cannot audit a spot-buy freight invoice as there is no rate to check it against. Therefore invoices are mostly put on hold and require additional action by logistics operations. The effort for them to either remember what they booked or to look up the information of what they shipped is a nightmare when managed manually. Are you going to dig into that 45 messages long email thread?
Alternatively, logistics providers are required to mail or email invoices to the respective person that booked the freight, who will have to process this manually. Both situations end up in a delayed payment process for logistics providers and additional administrative work for the logistics operations.
The solution is for a shipper to have all the information from the quote, shipment events, and final cost with backup paperwork in a single place. A place where they can easily check and approve or reject the invoice. This will also allow them to look into any differences in quotes booked and the final cost of a shipment. Additionally, any discrepancy is automatically flagged and can be compared against the quotes or tracking events. This is simply not possible if you try to do it based on emails and phone calls.
It can take logistics staff a significant amount of time to keep track of their spending and performance, you simply cannot generate a report based on emails alone. Unfortunately, many shippers build endless spreadsheets to track their spending on spot-buy freight or they are at the mercy of their logistics providers to receive this kind of data.
Shippers who use automated solutions or platforms to manage their spot-buy freight often have the functionality to extract data or download predetermined reports.
With Cargobase shippers can extract reports that give them a full breakdown of request, quote, shipments and invoices. It includes all data that both shippers and logistic providers have entered. It allows shippers to know exactly what they spend by a simple click of a button.