U.S. shippers spent more than $95 billion on shipping in 2016. But every day, somewhere between 3% and 5% of these shipments are late or incorrect.
Typically, shipping carriers offer full refunds for late or incorrect deliveries. That’s more than $2 billion in available refunds. And a full 75% of those refunds go unclaimed — some $1.5 billion every year.
If your company ships with UPS, FedEx, or another shipping carrier, you are likely owed a refund every time a package arrives late. But if you’re like most shippers, you don’t claim the refunds promised in your carrier’s service guide nearly as often as you could — if you ever claim them at all.
Parcel audits are critical to identifying and claiming your refunds. And beyond that, reviewing your invoices in detail also yields huge amounts of data that can help you save money on other aspects of shipping or in other parts of your supply chain.
What is a Parcel Audit?
Parcel auditing is the process of reviewing the invoices your carrier sends you weekly or biweekly. These invoices detail every delivery, including whether it was completed accurately and on time. But carrier invoices can be dozens or even hundreds of pages long, and errors may not be easy to find.
A detailed parcel audit, ideally assisted by software, will review every data point on every invoice and identify opportunities for savings. These include:
- Late deliveries
- Non-shipments, in which a package was scanned into the carrier’s system but never loaded onto a shipping vehicle
- Incorrect surcharges, such as packages billed for address corrections that did not need them
- Incorrect dimensional weight charges, in which the carrier may have measured the package incorrectly or applied the wrong dimensional divisor
- Duplicate charges
- Missed discounts as specified in your carrier contract
If you were to claim refunds for every late or missed delivery as well as for surcharges applied incorrectly, you could reduce your shipping spend by as much as 5%.
It’s not just that carriers make these errors difficult to find, however. If you do identify a mistake, you must submit a refund request to your carrier within a relatively short period of time, usually about two weeks. The carrier processes the request and credits it to your account. So in order to reap the benefits of parcel audits, they have to be completed quickly and efficiently.
How do you get Started With a Parcel Audit?
Parcel audits might be simple, but fitting them into your team’s schedule can be all but impossible. Manual parcel audits take hours. For that reason, most companies that make parcel audits part of their shipping process rely on software to identify potential opportunities for savings.
To get a sense of Reveel’s 45-point parcel audit program, download our parcel audit checklist. We offer proprietary software that automates the invoice audit refund process. We also handle the claims process, making sure your carrier issues refunds for every penny you’re owed.
How Much Does Your Parcel Auditing Service Cost?
The best part about Reveel’s parcel auditing service is that there are no out-of-pocket costs, setup fees, or long-term contracts. Instead, Reveel shares in the parcel audit refund credits we secure for our clients. If we save you 5% on shipping via refunds, you’ll share a percentage of those savings with us.
What are the Benefits of Small Parcel Audits?
Many shippers think they’re not big enough to realize significant savings from parcel auditing. That’s not true. Every invoice contains billing errors, overcharges, and late deliveries. If you can identify any of those errors and claim the credits that are rightfully yours, you can reduce your shipping spend. If you can do that time and time again over the course of months or years, the savings start to add up.
What About Companies That Ship Freight?
Companies that primarily ship freight should make invoice audits a habit, too. A freight bill audit works largely the same way as a parcel audit, except invoices list deliveries of full palettes or truckloads rather than individual parcels.
That means if deliveries are late or your bill contains errors, you may be eligible for a refund or a credit on your freight payment account. Since freight shipments have fewer individualized surcharges and fewer delivery destinations than parcel shipments, savings tend to be smaller, but they certainly exist.
Which Type of Parcel Auditing Should I use?
Almost no shipper uses manual parcel auditing anymore. If an employee, or even a team of employees, were to review every invoice line by line, it would take them hours and they’d be likely to miss errors. As your company’s shipment volume grows, so will their workload. This is neither time- nor cost-effective.
Software is key to successful parcel audits. A good auditing program can process a nearly infinite number of data points and identify errors far more accurately than humans. Software can easily be updated to reflect changes in carrier rates or contracts. Better yet, parcel auditing software allows shippers to compile comprehensive datasets that show them their shipping business from every angle.
Read More: How Reveel’s Invoice Auditing Services Can Save You Thousands Of Dollars
Do you Know What to do With Your Parcel Data?
Reviewing the data culled from parcel audits often leads to even greater savings. These datasets can show inefficiencies and outsized line items. If you’re spending far more than you expected on a particular type of surcharge, or if DIM weight pricing is affecting a particular parcel more often than you realized, you can make small changes to your supply chain and shipping operation to reduce the impact of those fees.
Read More: Decoding Your Shipment Data: Surprising Information Your Analytics Reveal
Parcel Auditing Service — how can Your Business Benefit?
Routine parcel audits can save you 3% to 5% on shipping right away, and reduce your spend by 3% to 5% on an ongoing basis.
Further, you can use the data generated by those invoice audits to realize even greater savings. By re-creating the box a certain product ships in or targeting a specific surcharge in contract negotiations, you may be able to save far more than 5%. In fact, Reveel’s expert team has a track record of saving our clients as much as 15% on shipping.
How can Reveel Help?
If you’re interested in parcel auditing, Reveel offers prospective clients a free invoice audit. Claim yours today to get a sense of how much money you’re leaving on the table. Beyond that, we can help you use the data from your parcel audits to find more opportunities for savings.
