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October 29, 2021

Freight Business Journal: AI comes to the Aid of the Forwarder  

Reducing costs and streamlining back-end processes through AI-powered solutions is widely considered to be the next key area of focus for optimization, says artificial intelligence (AI) — powered freight bill audit and invoice reconciliation solution, Expedock.

Reducing costs and streamlining back-end processes through AI-powered solutions is widely considered to be the next key area of focus for optimization, says artificial intelligence (AI) — powered freight bill audit and invoice reconciliation solution, Expedock.

Given the turbulent time the sector is going through, with port closures, congestion, stuck container ships, huge rate hikes, and detention and demurrage fees, there isn’t a freight forwarder or logistics provider that doesn’t need to look at how they can achieve more with fewer resources.

Expedock enables freight forwarders to instantly and significantly optimize their admin processes. It quickly helps them examine bills, adjust for discrepancies and verify data for accuracy. Accuracy is the key to these gains, it says. Freight forwarding involves a huge amount of admin and manual tasks that provide opportunities for human error to creep into. Automation can help streamline daily processes, remove errors and free up more time to target the core challenges.

Collating information from a semi-structured document and entering it accurately into an ERP or logistics management system is tedious. It takes away precious time that could otherwise be used for value-added services, creative problem solving contingency planning or customer engagement. Values may be inputted incorrectly, data may need to be located within different systems, fees may have been misapplied, data may exist in various file formats or require double-checking and correcting.

Optimization gets talked about a lot in the sector, yet many back office processes are still littered with inefficiency. Receiving documents via email or paper, reading and understanding the meaning, accessing the CRM, creating new records, entering the data, then checking the accuracy, are all very resource intensive. Forwarders need to examine the true cost of manual data entry to their business. These small efficiency gains can have profound results.

Statement of Account

Accounts Payable is a key function for freight forwarders and logistics providers, but effective invoice reconciliation can be a tedious and a very manual task. Expedock has released an automation for Statement of Account (SOA) management that it says is unique on the market.

Around 50% of all industry invoicing is handled through SOA, which, the company says, previously no solution was able to automatically extract and reconcile. Expedock says it has now changed that with the launch of their SOA auditing and entry automations on CargoWise. 

They are only going to move one way — upwards — and moreover, shipping lines are keeping customers strictly to contracted volumes, further reducing flexibility and leaving no space for businesses to grow. The question that many traders are now asking is not, what does it cost me to move this product but: Should I be moving this product at all? Do I have enough margin to sell it?

Since the end of 2020, deep sea shipping rates have risen to eye-watering levels - in some cases quadrupling - prompting shippers to take a long, hard look at their solutions. Rather than reconciling one invoice at a time, Expedock can now automate the reconciliation and data entry of entire SOAs, providing 100% accuracy within seconds.

In line with Expedock‘s full freight accounting offering, their SOA automation works by integrating directly with customer systems, such as CargoWise. Freight forwarders can leverage Expedock’s SOA solution as a standalone answer for their SOA processing needs or they can take advantage of the entire suite of freight accounting package.

It works by understanding the document, identifies the distinct invoices in the SOA, based on identifiers, such as the invoice number or the house bill of lading number, then automatically reconciles and enters all the granular levels of detail.

Expedock says the solution saves every accounting and operations team member around half a day each, per week The ability to access this level of enhanced solution will be a key differentiator going forwards and could shake up forwarders’ existing operations and enhance customer service, it argues. 

Allowable Discrepancies

The key benefit of greater accuracy is reducing the cost of errors. How much would you be willing to write-off in discrepancies? Every year, companies who don’t audit their invoices properly lose millions of dollars. Operational discrepancies easily occur at any point during the life of a shipment. With back-end workflows, companies allow 10-15% of invoice discrepancies to pass through without proper review because it takes too much time and effort to track down each one. Those errors quickly add up into thousands of dollars in lost revenue to the company. 

Some companies turn to optical character recognition (OCR) to combat this. OCR can extract data from invoices and other documents, but its accuracy from image-based scans or PDFs is poor, says Expedock. Similarly, Robotic Process Automation (RPA) tools can work when all the documents are very similar in nature and don’t change that much. RPAs are limited in what they can achieve and often incur large set-up costs and rely on templates to set the rules for collecting the data from specific coordinates within the digital image.

Expedock’s CEO King Alandy Dy shares that “By providing line item visibility, Expedock can provide an enhanced level of accuracy over other platforms and certainly beat any possible accuracy over manual process. Many forwarders do not yet have line item level analytics on their invoices and that lack of visibility is becoming a much bigger pain point that they need to address.”

There’s no denying that the freight forwarding market is shifting, and technology will play a bigger role in the future. Technology will increasingly be used to automate the boring aspects of the industry, and those who move quickly will reap the benefits sooner.

About Freight Business Journal

Freight Business Journal is firmly established as the leading multi-modal newspaper. It reaches out to the decision makers and influencers involved in international freight transport and logistics. FBJ boasts the most informative and authoritative source of information with unrivalled in-depth knowledge of the rapidly changing freight business environment.  Their complimentary website  www.fbj-online.com and weekly e-mail newsletter provide the most up to date news and analysis from within the international shipping industry.

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