Even seasoned logistics organizations have difficulties when it comes to billing/invoicing. One study even showed that 82 percent of all third party logistics (3PL) provider respondents said that they lost money because of cluttered, disorganized records and manual processing. It's an alarming revelation, and it makes you wonder what, exactly, is contributing to these lost revenues.
The answer is simple: Labor-intensive manual billing workflows and unreliable charge capture are contributing. Plus, there's also the lost opportunity cost of using person hours for billing-related tasks instead of customer retention and revenue-generating activities. So the real question is: how can 3PLs get that revenue back?
3PLs can eliminate errors and ensure that all charges are captured if they automate the entire process from end-to-end. Because human errors can prove so costly (both because they can slow down payment and they can result in the wrong payment amounts) automation is key in ensuring billing accuracy and making the end-of-month billing processes much easier.
The same survey mentioned above showed that around 54 percent of 3PLs take three or more days before sending invoices to their customers. In contrast, 3PLs using automated billing systems (those who already have their transportation management system integrated into accounting applications) only need a few minutes to send invoices to clients. Automation and integration are crucial in reducing days sales outstanding for already performed services.
Okay, at this point you must be thinking, “Wait. It’s not that easy. You can just flip a switch and magically reduce all of the manual effort required in sending freight invoices.” While it’s certainly true that it’s not as easy as turning on a lightbulb, with the right technology you can automate these processes—and save considerably by doing so.
Last mile logistics solutions can help businesses to adopt their current billing processes into automated ones. If your last mile solution truly covers the delivery process from end-to-end (i.e. from order creation to proof of delivery and everything in between), then it’s already gathering the information you need to bill quickly and accurately and settle with your drivers. How? We’re glad you asked...
DispatchTrack offers a way for 3PLs to get rid of billing bottlenecks by integrating routes and orders, tracking deliveries, and calculating invoices and settlements without manual intervention. Our solution lets companies speed up their cash flow, customize rates, and manage their billing more effectively by capturing crucial data in real-time: everything from client and customer information to driver contract rates to notes and accessorial charges on the day of delivery.
Here's how 3PLs can benefit from DispatchTrack's solution:
Of course, all this is made possible by the fact that our solution is already poised to optimize every touchpoint across the entire last mile. Because we’re seamlessly tracking and collecting information about the day of delivery as it unfolds, at the end of the day we already have all the information required to generate accurate freight invoices. This is, in a nutshell, how the right solution can help companies speed up cash flow. Again, automation cuts the billing preparation process significantly, allowing businesses to collect their receivables much faster than manually preparing invoices. Plus, automation eliminates human error, which costs businesses money and delays payments further. In the end, automating invoicing can help 3PLs save money in a huge way.