Why a Freight Payment Solution is Essential 

See why a freight payment solution is the single best path to managing your freight costs

Freight Payment Solutions Manage Business Processes

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:

  • Invoice receipt and verification
  • Invoice audits at the charge level
  • Exception management with carriers and shippers
  • Carrier payments, cycled to terms
  • Detailed reporting on all aspects of freight costs

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.

 

Freight Payment Delivers Exceptional Value

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:

  • Cost savings achieved through the elimination of overpayments and an unprecedented understanding of transportation costs
  • Efficiency in invoice processing, audits, accounting, payment, and carrier inquiries
  • Visibility delivered through a detailed, comprehensive view of all costs for all shipment types, modes, and geographies

 

Why Shippers Leverage External Resources

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:

  • A freight payment specialist is almost always better prepared to deliver a higher level of customization. Purchased software rarely provides the flexibility needed to accommodate complicated accounting rules, complex contracts, or many of the myriad other complexities involved in a shipper’s transportation management operations. 
  • Outsourcing providers are also more adept at providing meaningful business intelligence. Providers like Cass can integrate data from multiple sources, delivering much more valuable information to be used for decision-making and process improvement. 
  • Using external resources improves your ability to respond quickly to business changes. It is also a more scalable solution, an important concern for the growing organization. 
  • Partnering with an organization providing freight payment to other leading shippers gives you access to industry best practices.
  • Some providers deliver additional services that are highly desirable, such as working capital solutions for their carriers, for example.

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.

 

Can Your TMS Handle Freight Payment?

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.

Read more about why shippers aren’t using their TMS for freight payment

 

Cass Leads the Way as a Solution Provider

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:

  • Expertise in all modes, including ocean, rail, parcel and multimodal
  • Processing and reporting for all move types, including outbound, inbound, third party, intercompany and more
  • Detailed and accurate business intelligence to support both strategic and tactical decisions
  • A fully integrated global solution for all geographies and currencies
  • Commitment to process improvement (see it in Toyota’s words, not just ours)
  • Advanced systems for the most complex transportation infrastructures and business rules
  • Financial strength and stability, which gives Cass the ability to scale our operations to meet even the largest shippers’ needs
  • Full protection of funds delivered through SEC and Federal Reserve controls 

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.

 

Time to take full control of your freight spend?

Let us demonstrate how we can turn your freight payment process into an asset, instead of an incomplete solution that’s draining your resources.

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