Chances are that if you’re reading this, you are already familiar with parcel auditing. If you’re not, feel free to brush up on your knowledge on our parcel audit page. Regardless of your level of familiarity, we thought it pertinent to help inform the general public on some of the common misconceptions about parcel auditing. Whether you’re a logistics analyst at a huge, multinational organization, or the CFO of a local ecomm startup you’re going to want to read this.
Internal auditing prevents the need for third party auditing.
We are confident that your internal auditing team is doing a pretty good job. In fact, they might be killing it! You might be a member of that team! But are you really able to review every line item, for every tracking number, on every invoice? Are you tracking each package to ensure that it is arriving on time? Reviewing each accessorial charge for every shipment on every invoice? The sheer amount of time that can be spent on auditing is dizzying. Employing a third party auditor will compliment your internal efforts. By allowing a third party to double check your work, you can ensure you have a financial backstop in place and that no line item or chargeback is missed.
Auditing my invoices will harm the relationship with our carrier rep(s).
Professional relationships mean a ton, and your relationship with your carrier is no different. One of the biggest misconceptions about parcel auditing is that it will impact your relationship with your carrier rep(s) in a negative way. Thankfully, that’s not true! Your relationship with your carrier should be symbiotic, and parcel auditing is one way to ensure that your carriers are being held accountable for services rendered. Think about it like this, you’re a regular at a local restaurant and have a great relationship with a waiter/waitress. You order your normal meal and a side salad. Your meal arrives, you eat, and upon receiving the check you realize that you were charged for a salad you never received. Would bringing up this error to your server negatively impact your longstanding relationship? Of course not!
Using a TMS will eliminate the need for an audit.
Transportation Management Systems (TMS) have come a long way in recent years. The technological advancements made within the transportation industry are numerous but despite these advances a TMS will not fully eliminate the need for an audit. There are countless factors that can impact your invoice, not all of which can be prevented by using a TMS. Driver error, late deliveries, and countless other accessorial charges can find their way on to your invoice after the shipment has been manifested. Employing a third party parcel auditor will ensure that these post-shipping errors will be caught and refunded.
It is cheaper for us to audit our bills in-house.
Using an in-house audit team has its advantages, but so does using a third party auditor! In addition to acting as a financial backstop as mentioned above, third party audit firms are finding and recovering credits that your in-house team may have missed. It’s ok, we’re all human! Since most audit firms are typically paid a percentage share of the savings you’re getting money put back in your pocket that would have otherwise gone to your carrier(s). More money, less problems!
Auditors will sell the data they gain from auditing my invoices
Contrary to what you may think, parcel auditors aren’t employed by the NSA and your data won’t be shared. While recent security leaks may have you questioning the integrity of once-trusted organizations, you can be sure that parcel auditors are not sharing your data and the CIA won’t be showing up at your doorstep. Parcel auditors often times use the data from your invoices in a variety of ways, all of which revolve around cost reduction. Your data will only be used to set performance benchmarks to reduce your costs, not anybody else’s.
This takes too much effort/I don’t have time to implement.
Look, we know you’re busy. In fact, we’re surprised you have enough time in your day to stop and read this awesome blog post. In the interest of time, we’ll keep this as brief as possible. One of the most common misconceptions about parcel auditing is that implementation is slow and laborious. So slow in fact, that you simply don’t have the time to get the process started or manage the relationship going forward. Thankfully, that isn’t the case. In most cases, the audit set-up process is quick and painless, requiring next to no time to get set up. The go-forward relationship can be as hands on (or off) as you want, so you know you’re making the most of your busy schedule.
Our rep said our account is 99.9% on time – so there’s no need.
We’re sure your rep is a stand-up guy/gal, and we want to make sure they’re held accountable for their side of the relationship. That being said, errors can still be made on the part of the driver that can lead to erroneous accessorial charges appearing on your invoice, even if on time service failures are rare. While your packages may be on time, no doubt you want to ensure the accuracy of every other line item and accessorial charge on your invoices. Employing a third party parcel auditor will help keep the carriers honest, and make sure that every penny of your money is exactly where it belongs.
Author
Rich Harkey
Rich Harkey
Senior Strategy Manager
As the Senior Strategy Manager at Lojistic, Rich leverages over three decades of expertise to help businesses improve their shipping strategies and reduce costs. With a deep understanding of the requirements of shippers and the operational intricacies of carriers, he excels in everything from optimizing business rules and managing carrier invoices to negotiating carrier contracts.
Rich's comprehensive knowledge of the logistics industry, combined with his strategic insights and passion for data analysis, has enabled thousands of companies to gain visibility into their shipping expenses, driving impactful results.