Freight payment, also called freight audit and payment, refers to specialized systems and processes that manage high volumes of freight invoices and deliver deep business intelligence about all freight costs. These systems automate and fully integrate the following functions:
That is a high-level summary; there’s far more to it of course.
Many freight payment providers offer additional services that improve the value proposition and create an exceedingly impressive ROI. At Cass, for instance, some of these include access to a benchmarking database and a variety of financial management options.
The delivery of a freight payment solution is very much a blended model of software and services. Shippers will understand that any logistics management software requires constant care and feeding - to respond to business changes, new rates or carriers, and to support constant process improvement. These are tasks that freight payment providers specialize in.
If you have a large freight spend, putting a freight payment solution in place is necessary to effectively manage your costs. The benefits of a sophisticated freight payment solution go far beyond process efficiency and fall into three main buckets:
Although in-house freight audit and payment may be possible (more on that below), the number of shippers outsourcing the process continues to rise. Here’s why our clients, for example, make the strategic decision to partner:
All of the leading freight payment providers integrate with TMS, ERP and accounting systems for seamless data transmission. On the front end, this data might include shipment records from your TMS to support accurate audits. On the back end, providers will transmit cost allocation and accrual files, as well as cost and payment details, to your ERP.
Some of the TMS solutions have tacked on freight audit and payment capabilities in recent years. Despite this, however, the number of shippers outsourcing the process continues to rise. This is the result of two trends occurring with in-house solutions. First, TMS/ERP systems cannot handle the complexity that companies are requiring of them. We have seen shippers try to implement their TMS, thinking an all-in-one solution was the answer, but abandon their projects due to a lack of capabilities. If they are not functionally deficient when they go live, they become so quickly, as companies realize that what they built does not accommodate their needs. Secondly, few companies with in-house systems are dedicating the resources necessary to keep up with their evolving operations. Too often, the longer an in-house freight payment system is in place, the more it atrophies. Adequate IT and transportation resources aren’t dedicated to their maintenance, much less improvement. Companies also lack the expertise to design and maintain a truly superior system.
Beginning with its FreightPay® services more than 60 years, Cass today remains the largest provider, as well as the innovator, in the freight payment industry. Cass processes 37 million invoices and $28 billion in freight spend annually, The world’s largest shippers choose Cass for the following reasons:
When seeking an audit and payment provider, shippers can choose to partner with either a regulated or non-regulated entity. Cass is a financial holding company, providing funds management and payment services through its wholly owned subsidiary Cass Commercial Bank. Compliant with the many regulations set forth by the U.S. Federal Reserve as well as the Dutch Central Bank, Cass offers the best in freight payment – a results-driven, first-class outsourcing solution and maximum payment security for its clients.
See our six best practices for maximizing savings and data capture through the freight payment process
See why TMS systems tend to fail at managing complex invoice processes
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