Freight Accounting: 5 Steps for Freight Forwarders to Streamline Ops
Logistics companies are currently looking for every way they can streamline processes. Logistics companies waste precious time and hurt their bottom line with every sluggish or outdated process. New technology makes it easier to accomplish time-intensive tasks, like freight accounting.
Keep reading to understand the challenges of freight accounting and solutions to help improve that process for your team.
The biggest reason teams struggle with freight accounting is the time involved. The average team spends 2-4 hours daily entering and auditing data into Cargowise. However, three things cause an increase in time.
For large companies, operations staff could see thousands of invoices a day. The sheer magnitude of paperwork they need to sort through can overwhelm and bog down any team. In addition, manual work on invoice processing can take up to 40% of an operations team's day.
Data entry work isn't very interesting or meaningful, so it can also be a source of annoyance for teams. Many teams will try to rush through the entry process, leading to mistakes or lumping line items together to save time.
Most companies will get all kinds of invoice formats and unstructured bills. From paper invoices to emailed PDFs and spreadsheets, many formats need to become a single source of data within Cargowise.
It can take extra time to navigate the different document types and translate varying lines to the corresponding data fields in Cargowise. In addition, the manual conversion time slows down the invoice-to-cash process.
Errors in invoicing constitute a significant source of inaccurate charges for logistics companies. Rather than mistakenly overcharging shippers, brokers and freight forwarders should be able to audit and check discrepancies between accrued costs and estimates.
Instead, teams often make mistakes during the input and don't have enough time to compare invoices manually. As a result, not only does auditing become a time issue, but the inaccuracies can hurt vendor and shipper relationships over time.
Some experts estimate up to 66% of carrier invoices contain errors.
Modern tech and new processes make it possible to speed up freight accounting processes. If your team is drowning in paperwork, it's time to adjust and allow them to use their time more efficiently. Here are five things that will streamline your accounting and increase accuracy.
When your team gets a variety of invoices, they need to convert data into a singular source. With AI, it's possible to automate the process of understanding each freight statement of account.
Expedock software speeds up the entire process by automatically reading any format and translating it into data for Cargowise. The AI-powered software allows machines to upload unstructured invoices and fill in the corresponding data fields—even if they aren't listed precisely the same on the invoices. Expedock has shown over 99% accuracy and can be customized to fit your business's accounting setup.
Customizations within Expedock make it possible to recognize and code according to your company. Keeping your data organized is crucial for transparency and compliance. With AI entering correct codes and detailed information, companies can trust they are getting everything into their accounting software.
Manual data entry often mistook commas for periods or omitted a zero. As a result, companies can suffer from poor reputations when mistakes are made. In addition, teams are overloaded and can't focus on high-level issues. AI allows organizing and coding data without increasing human resources hours.
Human oversight is still used within the modern accounting process. Expedock's AI software will alert your team when it catches a discrepancy during automated auditing. Likewise, you should have accounting experts ready to examine invoice errors and question invoices that don't align with estimates.
Expedock customers find they save thousands of dollars each month by catching discrepancies that would otherwise result in overcharges. This automated flagging system helps their teams catch issues and handle them appropriately on a case-by-case basis.
Many logistics companies are running into additional charges when they face sluggish processes. For example, for freight forwarders, carriers may have late fees for delayed invoices. Getting invoices into the system and sorted by the due date can reduce unnecessary expenses incurred by late payment fees.
It's essential to prioritize your accounts by date, yet that's not possible if you don't have the invoices in your system. With teams running far behind processing, invoices can be mistakenly overlooked and neglected. In addition, late payments can hurt relationships with your carriers and owner-operators who depend on timely payments.
Getting all the details right is crucial for increased transparency and accuracy. When shippers want to understand charges, it's important to have the costs broken down. With line-item input, teams can show where increased costs may occur or how a carrier is arriving at a number for the load delivery.
There are many ways Cargowise reconciliation through Expedock is valuable to your company. Here are some of the biggest benefits our customers' experience.
Speeding up any process saves time and money for the company. Of course, your employees will have more time to do other tasks, but your shippers and carriers will benefit from faster invoice processes. Speed is king in today's on-demand world.
AI can take just a few seconds to do something that would take a team member minutes. Take just two hours to onboard with us, and you could experience 60 hours of human resource savings! AI can support your human workforce by doing the jobs no one wants to do.
Teams rarely enjoy menial busy tasks. Data entry is easily accomplished by sophisticated software like Expedock. Stop overloading your team with work below their ability level. Instead, allow your team to spend time on the tasks requiring their skill, expertise, and creativity. Empower your talent by giving them jobs supporting professional development.
Companies that pass busywork to machines can reduce the burden on their teams. With improved insights and automated accounting, your team will no longer have a mountain of paperwork bogging them down daily. As a result, your turnover rates are lower, with less stress, and your team morale is higher. In addition, a happier team often leads to happier vendors and shippers since your team will have more time to spend on their concerns or questions.
When you increase your data entry with AI, you get more insights with accurate information. While many teams are tempted to enter charges as a lump sum, the lost line-item detailing can make it difficult for shippers to understand the charges.
Improving data entry to include accurate details can help companies improve their processes moving forward. For example, if there are high detention fees, shippers may need to consider hiring a larger team to unload or assess their docking procedure. And, if the exact extra charges occur repeatedly, forwarders can start putting those into the expected estimate for that carrier or shipper.
The increased accuracy can help build better relationships with vendors and shippers. You can offer valuable insights that can lead to business growth and improved efficiency for your partners and your company. With increased insights, you may be able to stand out from the crowd as a freight forwarder of choice.
Expedock customers find that their cash flow cycle improves by around 3-5 days on average. With faster payments, you will experience reduced charges for late drayage payments. In some cases, you may be able to eliminate your late payments completely, saving your company thousands of dollars. Faster payments also increase your value with carriers, helping you become a preferred partner. Over time, shipping networks can prove invaluable to your business.
It's time to end the ancient processes and get new technology to handle menial tasks. For example, Expedock can help speed up your bookkeeping and improve your accounting accuracy.
Spend just two hours onboarding with us, and you will be ready to take off with AI. Talk to our team for a FREE demo today and start streamlining your accounting!