For companies that ship a significant amount of parcels each year, getting the most out of shipping costs should be a top priority. Ensuring their accuracy can save companies money in the short- and long-term—maximizing profits and revenue.
But how do you optimize shipping costs? Along with carrier contract negotiations, performing a parcel invoice audit or a shipping audit at regular intervals is an excellent way to minimize shipping costs. But what is a shipping audit, and what should be included in a checklist to ensure thoroughness and accuracy? Let’s get started.
A shipping audit is the process of checking, analyzing, and validating each one of a company’s shipping bills and invoices for information related to overcharging, service failures, and other errors in the shipping process. Regularly performing parcel audits can help companies minimize their overall shipping costs and increase company revenue. When performing such an audit, companies should look for the following:
While there are other discrepancies that may appear on a shipping invoice, such as additional handling charges, area surcharges, or fuel charges, the list above should provide a wealth of data and information for companies to optimize their shipping costs. At ShipSigma, our Parcel Invoice Audit & Reporting platform can automatically identify invalid charges and put money right back into your company’s profit–all with no long-term commitment required!
When preparing for and performing a shipping audit, it can be helpful to have a shipping audit checklist to ensure consistent and accurate auditing. Simply put, an audit checklist is a list of activities and tasks that must be performed during each audit.
How do you create an audit checklist for shipping? Simply use information below to build an audit checklist template that can ensure shipping audits are performed consistently.
If you don’t already, it’s critical to have detailed invoices when performing a shipping audit. Carriers will typically offer these in CSV or PDF formats.
Next, gather the necessary information and determine the timeframe you will audit. For example, you may look at invoices from the past three or six months.
Before beginning the audit, group your invoices by type and by vendor so you can keep any claims that need to be made separate and organized. You may also find it helpful to sort the invoices by date.
Using the list above, look for errors or overcharges on each invoice.
After checking for errors and overcharges, you should also check to ensure that you are being charged your current carrier discount rate.
In addition to any errors or overcharges, companies may also use a shipping audit to analyze the data for any consistent trends. Are you noticing price hikes? Regular address corrections? Do shipping costs seem to be trending upward? Any of this information may be used in future carrier contract negotiations.
Does the above sound like an arduous and time-consuming process? Are you quickly finding that manual shipping audits aren’t returning the results you want? Try out ShipSigma. We started our company to help businesses save money.
Our AI-powered parcel invoice audit platform automatically scans your UPS and Fedex invoices and performs a 50+ point audit. Then, it automatically files carrier claims to save you money every week. We believe in our platform, and we know you will, too. In fact, try it out for free to start seeing results and saving money.