{"id":129,"date":"2011-09-08T12:59:51","date_gmt":"2011-09-08T12:59:51","guid":{"rendered":"http:\/\/www.peeriosity.com\/articles\/?p=129"},"modified":"2022-04-06T22:11:07","modified_gmt":"2022-04-06T22:11:07","slug":"efficiency-and-value-in-managing-freight-payments","status":"publish","type":"post","link":"https:\/\/www.peeriosity.com\/shared-services\/articles\/2011\/09\/efficiency-and-value-in-managing-freight-payments\/","title":{"rendered":"Efficiency and Value in Managing Freight Payments"},"content":{"rendered":"


\n<\/a>I know what you\u2019re saying; \u201cFreight payments? You\u2019re talking about freight payments?\u201d It\u2019s not anything most of us think about much, but maybe we should give it a little more attention \u2013 there may be some gold to be found!<\/p>\n

Generally, freight payments are managed as a sub-set of the Accounts Payable<\/a> group and managers are usually satisfied with the results (see poll results below). The focus is usually on making sure carriers are paid on time and the flow of products is not interrupted. Charged rates versus contract can be very complicated to reconcile so many times these are left for after-the-fact audits, either internal and\/or by recovery firms, if audited at all. Recovery firms are ready and willing to audit and take a percentage of their findings. They usually do a great job and can generally identify substantial refunds, even after taking their fee.<\/p>\n

In a recent Peeriosity Accounts Payables research area webcast (one of 10 research areas), a member company led a discussion on how Shared Services is successfully managing its freight payment process. Most notable, our feature company viewed freight payments as a critical back-end activity tied closely to the entire logistics chain. While it is organizationally placed in Shared Services, they partner closely with the logistics function.<\/p>\n

A few poll questions were asked to our members to level set what their satisfaction was with their current freight payables process, as well as how it is sourced. While 31% were very satisfied, the majority acknowledged there were some pressing opportunities.<\/p>\n

\"satisfaction<\/a><\/p>\n

The follow-up question related to sourcing of the processing and 56% indicated it was in-house as part of Accounts Payable, while 40% indicated it was outsourced. Peeriosity members can see the full results and the level of satisfaction correlations between those who are processing in-house versus those who outsource.<\/p>\n

\"source<\/a><\/p>\n

The webcast discussion went into detail on the actual process flow of making freight payments. One of the key points made was that optimizing the process requires full partnership with the logistics function. It\u2019s critical that certified carriers are used with negotiated rates that are fully documented. Partnering to include electronic remittances<\/a> and payments can also make the process more efficient.<\/p>\n

Our feature company chose to outsource its freight payment process. In qualifying potential partners, attributes to assess for inclusion in the RFP included:<\/p>\n