Freight Bill Auditing: Are you Being Overcharged?

 

Invoice

Freight costs can add up quickly. The more you need to move your goods around, the more you need to keep careful track of what you are being charged. This can be critical in cases where customers are not reimbursing you for freight charges, or you are moving goods from one site to another and not able to recoup freight costs. It is a good practice to audit your freight bill after delivery to ensure that the negotiated cost is actually what you paid.

Statutes of Limitations

Different countries have different statutes of limitations on when you can dispute while it is in your best interest to audit your freight bills as soon as possible, make sure to check into your local laws to find out just how long you have to dispute your freight bills and recoup your costs.

Why Overcharges Happen

There are several reasons that overcharges happen. Undercharges can happen as well, but they are much rarer than an overcharge.

The main reason overcharges happen is that many shipping companies outsource their billing. This means that if you negotiated a nonstandard rate for your shipping, or a special rate for some reason, your contract may not be passed along to the billing company and you are charged standard rates. Invoices are sent and paid to the billing vendor instead of directly to the carrier.

Because of this, many times the carriers are just receiving a lump sum of money directly from their billing vendor and never get to review individual contracts. They leave that review up to the billing vendor.

Keep Detailed Records

The best way to dispute overages on freight charges is to have a very detailed paper trail. Contracts that are worked out over dinner and agreed to with a handshake are most likely not to hold any weight when you go to dispute overage charges. Make sure to write down and document all of your freight charge negotiations with your carrier. When both parties agree to terms, draw up a contract and have both parties sign to make it legal. This way if overage costs occur, you have a legal and binding document to refer back to in order to hold the shipping carrier to the deal you struck.

Using a Third Party Auditor

If you do a lot of shipping, one of the options you have is to hire a company that will perform audits for you. Again, the amount of money that the firm is able to recoup for you is going to depend directly on how detailed your records are.

Many of these companies operate on a recovery cost basis. For example, they will take 50% of all the returned costs in payment. This means that if they recover nothing, you get charged nothing.

When preparing your goods for transport, trust industrial packing experts like Cratex to make sure your goods are packed properly for their trip. Contact us today for a quote!