Three Major Mistakes LTL Shippers Make & How to Avoid Them

Transportation and logistics executives are under immense pressure, grappling with skyrocketing freight carrier rates and relentless cost-cutting demands. Missing savings targets has become all too common. Yet, by steering clear of these common pitfalls, significant improvements can be made. Here are three major mistakes to avoid:

Mistake 1: Failing to Plan and Measure

The Problem: Many companies lack accurate projections for freight expenses and have poor coordination between departments. This results in higher costs and inefficiencies.

The Solution:

• Data-Driven Decisions: Use advanced analytics and integrated systems (like TMS and ERP) to make accurate projections.
• Centralized Control: Consolidate LTL shipping under one central control. This can help negotiate better rates, standardize costs, and reduce fees.

Mistake 2: Inadequate Invoice Audit Controls

The Problem: Internal audit processes often fail to ensure freight invoices are accurate. This can lead to lost discounts and additional fees.

The Solution:

• Automate Audits: Implement automated invoice auditing solutions to ensure accuracy.
• Train Staff: Ensure your accounts payable team understands freight bill elements and can validate them correctly.
• Use Technology: Leverage machine learning to identify discrepancies and optimize payment schedules.

Mistake 3: Failing to Ask for Help

The Problem: Many companies don’t use outside resources to control freight costs, missing out on potential savings.

The Solution:

• Leverage Experts: Partner with third-party logistics providers (3PLs) and freight audit firms. They can offer benchmarking capabilities and cost-saving strategies.
• Cost Efficiency: Studies show that using third-party firms can reduce invoice processing costs from $7.00 to less than $1.00 per invoice.
• Post-Audit Services: Use post-audit services to find and recover overcharges missed during initial audits.

To control rising shipping costs in 2024, it’s essential to plan, evaluate, and set realistic goals. By avoiding these common pitfalls, companies can achieve their goals and stay within budget. A little upfront planning and expert help can make a big difference.

Ready to optimize your logistics operations and cut costs? Contact us today to find out how we can help you avoid these pitfalls and achieve your goals.