A worldwide renowned LED manufacturer had to pay $93,147 more due to incorrect billing currency.
Another company lost one of its big customers for wrongly entering the address of the consignee.
Incidents of wrong billing and invoices like these are not uncommon in freight forwarding and logistics routines. Company bottom lines are severely affected, even if these occur occasionally. Since your customers trust you to handle their shipping, customs, and delivery processes, such mistakes are a letdown. In most cases, the real cause of such trouble turns out to be human error or miscommunication.
Handling a freight forwarding business means encountering a large volume of shipments, this can get overwhelming for your staff when done without the right tools. Freight software helps you considerably streamline and manage your processes and thus reduce data entry to a great extent. When the software handles auto-populating the major parts of your invoicing, the margin of error is largely brought down.
While ending up paying fines and penalties for the errors is not the only setback that you receive. More business aspects including, disrupting your delivery schedule and cash flow, are also affected. Let's explore them in detail and take steps to avoid them in the space below.
What steps must you take to avoid incorrect invoices and billing?
- Preparing invoices itself is a tedious task for forwarders as it involves entering details for freight dimension and HS Codes, shipper and consignee business details, complete goods description, due dates, and many more. Generating documents like HBL/HAWB, AWB/MBL, reconciling contract terms with Bill Of Lading (BOL) are all part of the process. The processing of information for the invoices is intricate and tiring for employees and one of the reasons for errors.
- Solution: Freight management software creates masters for various entities in the system. Masters hold complete details about an entity like a consignor with the business name, address, and a unique identifier in the system to identify it. Handling multiple bill formats as well as multiple currencies is part of the software capability. Thus, redundant data entry gets eliminated, and the probability of error.
- Finding accountability in case of billing issues is near impossible with traditional software. For example, one of our customers approached us when he was overbilled throughout 14 days by an amount of $935,578 owing to the incorrect weight applied. So if data mistakes do not get discovered timely, sooner or later, it shows the impact on profitability.
- Solution: Freight ERP software comes with internal audit trails that record digital entries of all transactions. Tracking back an issue will lead to the source of the problem. Accountability can help save several dollars and even avoid getting you entangled in legal issues.
- Incorrect authorization is similar to a human error but can, at times, go undetected by the system. Say, a particular customer has an outstanding, and you wish to receive the dues from the customer before you authorize their next invoice. Dealing with an enormous amount of transactions daily, expecting your staff to apply the dues and restrictions on such customers is just not possible.
- Solution: Software for freight allows credit limits to be set on customers. Thus, making the system known that if the dues are not cleared additional transactions must not go through. Further, automation such as Daily Status Reports can be auto-scheduled to be sent to all parties with their consolidated accounts payable and other invoices; bringing transparency and clarity of communication.
Achieving Freedom with Worry-Free Billing and Invoicing
When you automate manual tasks with the best freight software Logi-Sys, you free your staff from laborious efforts that are error-prone. The result will be faster turnaround times, optimized processes, easier bank reconciliation, and winning the customer's trust.
If you avoid investing in good software, you could be spending a lot of time fixing holes that will never stop appearing. By implementing industry-trusted freight solutions, Logi-Sys freight forwarders can further reduce a few related direct expenses and save operational costs by up to 50 percent.