How Forwarders & Shippers Eliminate Common Freight Invoice or Seabill Processing Errors
The growth of the freight forwarding and shipping industry appears to have no roof. The global freight forwarding market is expected to record an annual growth rate of more than 3.6% between 2022-2027. According to the Bureau of Transportation Statistics, cross-border freight between Mexico, the United States, and Canada was valued at $139.4 billion in May 2022, up 28.3% compared to the previous year. Freight shipped between the U.S. and Canada totaled $71.0 billion, up 30.4% from May 2021. The increase in spending also means increases in shipping volumes. With increases in volume comes added responsibilities for freight forwarders and ocean shippers. Even the smallest error in invoicing can cause sizable financial issues that cost companies money. With more information to be compiled and stored, inaccuracies in areas like freight invoice processing, payment, and billing will be compounded and losses could begin to mount. It’s clear that having an error-free handle on freight forwarder invoices and seabills will be even more crucial to continued growth and success.
A freight forwarder invoice is a document issued by the carrier to a consignee of freight that contains the description of the commodity, the point of origin, the name of the shipper, the weight, and the number of charges applied. A seabill is a type of bill of lading issued as a cargo receipt, must move to the front of the to-do list to assure success. A freight forwarder invoice is important because the accuracy of the data ensures that the products arrive correctly and on time, and that everyone gets paid. Freight invoice processing can often be the bane of any logistics manager. For example, when insurance claims and invoices do not match, an invoice can become a time consuming and costly process. With a global supply chain that has, in the past two years, proven to be susceptible to failure when faced with unexpected volatility, logistics managers are realizing that clarity in handling freight forwarder invoices and seabills is crucial. Learning to identify freight invoice errors and taking proactive steps to get to the bottom of it can save you a lot of money in the long run.
The question of why freight forwarder invoices and bills should be streamlined boils down to a simple answer: Those errors can mount up and correcting them can save a lot of money. Let’s take a look at the many places where you can find those costly mistakes.
The most likely errors that occur happen during the initial documentation on the freight forwarder bills and invoices. Incorrect dates, locations, and spelling errors can cause huge shipping delays. For example, shipments being delivered to the wrong address, or at the wrong receiving hours may result in detention costs, fines, and upset customers.
Accessorial charges, which cover work by the carrier outside the standard pick-up and delivery, can be a nightmare, especially considering the recent supply chain talent drought. That’s why a more detailed transportation strategy can help minimize accessorial charges by making sure items are efficiently packed to reduce handling and accurate tracking.
The mismanagement of documentation and invoices can often lead to delays that result in detention and demurrage fees. With the help of Expedock, freight forwarders and shippers can automate the accounting process and data entry to allow for immediate access to documents to see where those errors are leading to delays. Also, the automated solutions could highlight concerns that might arise about the performance of certain carriers and whether a new fit is needed.
These fees can quickly become unexpected expenses and cause confusion about what numbers are the accurate ones. For total cost efficiency, and peace of mind, it’s vital to make sure as many of these are figured into all freight contracts.
The National Motor Freight Classification (NMFC) code is used to group commodities and help freight forwarders classify them based on categories like how they fit in a truck or what loading, handling or perishability issues could arise. Greater attention to assuring the NMFC number is correct can help shippers avoid getting overcharged. .
You can’t prevent all of the charges that come with shipping, but now that we’ve gone over the ways that freight forwarder invoice and bill errors can eat into profits, it’s time to list exactly what can be done to counteract and reduce them.
Invoices done manually can be time consuming, labor-intensive and susceptible to errors. That is where an automated process comes in extremely handy because it allows invoices to be scheduled and processed/delivered immediately for the company. It can free up their teams and streamline their day-to-day operations.
Shipping characteristics such as weight, dimensions, class are found on all freight forwarder invoices and are the nuts and bolts of the business. Understanding them and analyzing them is necessary to cutting costs and predicting what will improve that ability to ship the product.
Consolidation puts all of your shipment invoices into a single organized system. It thereby solves organizational issues that may occur with freight forwarders who have multiple offices. It can help you eliminate duplicate payments, provide a shorter turn-around time for payment and a way to track all the data gathered, and allows for auditing to be done on the front end.
Being able to easily assess all of the information pertaining to a shipment is a must. But having it all readily available ahead of time can help forwarders improve their on time deliveries. Accurate information leads to speedier delivery because you know what it will take to get from point A to point B and what will be needed at any stops along the way. For example, if a load requires lift gates, knowing the weight and dimensions ahead of time allows you to be prepared for the need for lift gates when shipments are heavy or difficult to manage. If the need for a lift gate is known ahead of time, it can save costly delays incurred when the shipment arrives and there is no way to move it.
There are 18 different freight classes which are defined by the National Motor Freight Traffic Association (NMFTA) based on weight, length and height, density, ease of handling, value, and liability. Knowing where each one of your shipments fits into each one of those classes and being able to know all of that in short order can help improve your system on all counts.
Just as it allows all the information to be combined in an easy-to-reach manner, an automated system also allows one person to be in charge of that information and eliminates the hurdles that come with the left hand not knowing what the right hand is doing.
The best way to offset surcharges and accessorial fees is to be prepared ahead of time. That knowledge will equate into more money saved.
Every system will have unique situations that have to be dealt with either ahead of time, during the shipment’s journey or on the backside. Planning ways to be preparedfor what to do in those instances can be a useful tool in reducing losses and strain.
Expedock’s AI-powered solutions for digitization, automation, and data analytics can deliver what freight forwarders and shippers need. Now more than ever, shippers and freight forwarders must identify ways to help optimize their record keeping. Building a strong, streamlined data structure is a must to help increase efficiency. Through Expedock’s technology, invoice and payment processes as well as the monitoring of those processes can be significantly improved on and made easier to understand. For freight forwarders and shippers, the first step into a much clearer world of freight invoice and seabill processing is to contact Expecock for a consultation and demo at our site.