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FREIGHT AUDIT AND PAYMENT (FBAP) Reduces Logistics costs and Increases Cashflow, While Accounting for and Managing complex Supply Chains, Vendors and Transportation Service Providers (TSPs).        -by Allan J. Miner, CT Logistics (April 2016)


FBAP (FREIGHT AUDIT AND PAYMENT) systems reduce outgoing accounts payable cash flows and deliver valuable data for faster reaction to fluid logistic demands.


Because transportation is not procured like any other spend category, its impact on a company’s bottom line must be audited to be successfully optimized and effectively managed.  The visibility gained with an integrated, end-to-end FREIGHT AUDIT AND PAYMENT (FBAP) solution creates a complete picture of all supply chain costs, allowing companies to benchmark supplier performance and develop future procurement strategies and budgets with more accuracy. Metrics of spend cycles are also critical in today’s business economy.  Today’s carrier contracts are very detailed, especially with surcharges, accessorials, taxes and supplement bills. To manage this complexity, FREIGHT AUDIT AND PAYMENT (FBAP) systems must:

  • Calculate and audit all rates, pricing, tariffs, product classifications, surcharges and taxes
  • Adjust for any tariff bureau rates or any contractual discounts and negotiated rates between each shipper
  • Handle complex general ledger account code allocation down to the SKU level
  • Retain complete details for future benchmarking and visibility

With these features, FREIGHT AUDIT AND PAYMENT (FBAP) companies and professionals control costs through auditing, allowing clients to significantly benefit from freight reductions before payment.  This solution also increases efficiency and enhances control over freight payments while removing waste and reducing costs.  With real-time, 24/7 online visibility, shippers can increase efficiency by collaborating with FREIGHT AUDIT AND PAYMENT (FBAP) providers and carriers to process, pay and resolve all exceptions quickly. Online FREIGHT AUDIT AND PAYMENT (FBAP) technology increases the flow of data and minimizes time spent on this process.  FREIGHT AUDIT AND PAYMENT (FBAP) companies also offer comprehensive EDI capabilities with streamlined information flows, allowing for the elimination of paperwork.  These electronic or scanned invoices are then provided to clients online 24/7 with typically 7-10 years of historical data or electronic media for easy, space-saving storage.

            FREIGHT AUDIT AND PAYMENT (FBAP) software and services also deliver comprehensive and accurate rate databases.  Shipping agreement rates need to be auditable and FBAPs organize these rates into logical formats that can be easily understood, compared and analyzed.  Historical or current rates from a carrier can be compared to quotes for new service.  Online 24/7 access to rates are important and FREIGHT AUDIT AND PAYMENT (FBAP)s can deliver these in their entirety or allow clients to filter by lane, mode, region or carrier, while exporting this data to clients in spreadsheet format.

FREIGHT AUDIT AND PAYMENT (FBAP) solutions today encompass integrated financial capabilities to report accruals allowing for precise spend visibility and liability.  Current freight auditing technology provides valuable business intelligence gathering and visibility.  The most valuable benefits are the analytical data generated by your FBAP system.  Weekly, monthly and year to date reports offer insight into complete supply chain spend.  For global shippers, FBAP companies use currency and conversion tools allowing for apples-to-apples analysis.  FBAPs also provide what-if and ad hoc scenarios using historical information delivered as needed.  These can be used to generate accurate predictive models.  Granularity is key for delving into the precise impact on costs that would result from making even the smallest of moves, such as changing a particular lane to a new carrier or relocating a particular product to a new distribution center.

There are multiple options for utilizing a FBAP system or software product.  Based upon the needs of a company, tailor made options can be designed.  Modern FBAP software and systems can be licensed as a stand-alone, in-house software as a service (SaaS).  Shippers can choose among various usage options, depending on their needs, their budgets and their level of comfort when it comes to operating supply chain optimization systems. Today’s options include:

  • Licensing the software:   The software package is installed at the client location, along with subsequent software support while the company performs all rate contract rate entry and audit functions.
  • Software as a Service, or SaaS:   24/7 access is provided to secure service via servers maintained by the FBAP company for a monthly fee. The licensing client’s staff performs all contract rate entry and audit functions.
  • Business Process as a Service, or BPaaS:   24/7 access is provided to secure service via servers maintained by the FBAP company for a monthly fee. Unlike SaaS, the FBAP company perform most of the back office auditing tasks. The end-user, however, has easy access to the most up-to-date information about rates and business rules, on a 24/7 basis.
  • Outsourced:   All back-office, end to end FBAP processes handled by the FBAP provider.


Whichever solution fits your business needs, FREIGHT AUDIT AND PAYMENT (FBAP) partners can co-create value for small, medium and Fortune 500 companies.  FBAPs have been helping shippers find hidden cash in their supply chains for over a century.  A strategic partnership with an FBAP can eliminate over billing, pay invoices accurately and quickly and increase your supply chain visibility.  Choose an FBAP with the business agility to cater and design their processes to your specifications.  Statistically 1 in 5 freight invoices are incorrect; thus thousands of shippers around the world are leaving money on the table!  Partnering with FBAP firms can deliver immediate ROI!