Imagine your business spends millions—even tens of millions—on freight annually, yet you have no visibility into where that money goes or how to spend it more efficiently. It's like navigating in the dark. In today's increasingly competitive market, granular freight cost management and data-driven insights have become critical for improving profit margins. This article explores emerging trends in freight payment management and reveals how companies leverage data and technology to transition from inefficient practices to optimized operations.
The Changing Landscape of Freight Payment
The freight payment industry serves as a mirror reflecting broader transportation sector evolution. Dominated by giants like Cass and U.S. Bank serving multinational corporations, the field also includes dynamic mid-sized players like Cleveland-based CT Logistics, which celebrates its centennial this year. CT Logistics President Allan Miner has witnessed this transformation firsthand. "I started in the mailroom 40 years ago—many from the older generation have since retired," he recalls, noting that contemporary freight companies and payment specialists often lack deep institutional knowledge.
Miner observes that newer professionals frequently lack the intensive management training and hands-on experience that characterized previous generations of transportation managers. "Today's industry education and qualifications simply don't measure up," he states. Consequently, shippers with limited expertise increasingly rely on firms like CT Logistics for specialized transportation knowledge and logistics solutions.
Industry experts identify three key trends emerging in Freight Audit and Payment (FAP):
1. Leveraging data visualization to manage freight volatility
2. Conducting scenario planning to evaluate transportation mode impacts
3. Improving upstream communication of logistics challenges
Managing Volatility in a Data-Rich Environment
The most valuable contribution from freight payment companies may not involve bill processing itself, but rather the wealth of data hidden within those transactions. Mike Regan, Chief Relationship Officer at TranzAct Technologies, notes that data availability now "far surpasses historical standards." Yet many shippers struggle to access this information in usable formats.
"Companies particularly want to answer 'what-if' questions about established freight patterns," Regan explains. "They need to compare 'how we've always done it' with potential alternatives."
Regan suggests carriers often collect more data than shippers—recording truck arrival times at facilities and driver feedback about site interactions. While shippers rarely access this information, carriers use it to influence rate negotiations.
"These invoices contain treasure troves of data," confirms Cass's Carlson. "We see heavy investment in real-time analytics technology, plus growing demand for consulting services—especially following recent supply chain cost increases."
How One Company Saved $1.17 Million in Parcel Costs
With parcel costs skyrocketing, when a qualified third-party logistics provider saves a client $1.17 million annually, it makes headlines. That's precisely what AFS Logistics achieved for Rexel USA—one of America's largest electrical distributors serving millions through 500+ branches and distribution centers.
AFS, which processes $11 billion in freight bills annually, implemented several improvements for Rexel:
- Reduced LTL carriers from eight to two
- Established a new claims process recovering $238,000 in 15 months
- Managed general rate increases and created parcel claim audits
- Delivered actionable reporting with carrier collaboration
"When needed, we work directly with AFS—their responsiveness provides exactly the support we require," said Rexel's National Transportation Manager Travis Gordon.
Strategic Transportation Mode Selection
Top freight payment providers analyze millions of transactions to identify wasteful spending patterns. When excessive parcel or air freight expenditures appear, they might recommend consolidating shipments into more cost-effective truckload services.
"This isn't just about transportation—it affects accounting too," Carlson emphasizes. "If a company airfreights packages 100 miles, perhaps ground shipping would suffice."
Converting LTL shipments to truckloads represents another common optimization. CT Logistics' Miner notes this data-driven approach enables more strategic, long-term value propositions beyond transactional processing. His firm handles $8 billion in annual payments across 50 million transactions, allowing precise benchmarking. "We can show a 100,000-LTL-shipment client their rates are strong compared to a million-shipment customer paying 10% more," he explains.
The Future: Upstream Communication
Clients increasingly demand capabilities extending far beyond basic audit and payment functions. U.S. Bank's Global Transportation Managing Director Jeff Pape notes growing requirements for real-time data sharing and actionable analytics.
"The freight invoice contains tremendous data," Pape observes. "The challenge becomes presenting it in ways that drive operational decisions—whether distribution center allocation, mode selection, or other internal choices."
Experts agree organizational efficiency remains paramount. As supply chain issues reach boardroom agendas, Regan notes shippers benefit from FAP partners who can effectively communicate resource requirements for building resilient networks. Miner adds that industry consolidation creates opportunities for firms investing in R&D and maintaining technological advantages.