Running a small business is not an easy thing, especially when you are just starting out with this whole story. You need to be up to date with many things to make sure everything works optimally and ensure the future of your company. Freight invoice audits are a small but integral and important part of many small businesses. Audits of these invoices ensure that you gain insight into whether everything is in order with the payment and protect the interests of both carriers and companies. Below you can read about the common mistakes small businesses make with freight audits and prevent yourself from making them.
Contents
1. Skipping auditing of each individual shipment
Source: cognicert.com
One of the biggest problems that occur when it comes to freight audits in small businesses is skipping auditing each individual shipment. Small businesses at the beginning have very few people in the team, and there are so many things to do. So they often try to find a way to make things easier for themselves and decide to shorten some tasks. This can sometimes be a good idea, but not when it comes to freight audits.
Auditing usually takes a lot of valuable time. That is why sometimes small business owners decide to inspect only a part of them and to make a conclusion about the correctness of all invoices on the basis of that smaller sample. However, keep in mind that this is not practical and can lead to major problems in the long run. Just because you didn’t find a problem in the 10% of invoices you audited doesn’t mean it doesn’t exist in the other 90%. We suggest that you take the time to audit all individual shipments so that you can gain a clear insight into what is working and what the problems are. We know that this is a long and tedious process, but trust us that persevering in it will certainly be beneficial for your company.
2. Not double-checking whether freight audits were actually performed
Source: cpacanada.ca
Small business owners are generally overwhelmed with various jobs, so they often transfer work tasks to other team members. This is sometimes the case with freight audits, whose execution is delegated to one of the employees. After a while, you as the owner may assume that the team member is still doing the audit, but since you did not mention to them that you expect them to continue with this task in the future, this is not the case. Not checking whether freight audits were actually performed can become a huge problem for your business in the long run.
It has been shown that due to incomplete auditing company’s costs increase at the speed of light. And now imagine a situation where there is absolutely no checking of what is happening on invoices. After a while, your business will start to fall apart because of this, due to high expenses and other problems that have arisen as a consequence of not performing this valuable task. This can also prevent you from noticing some strategic barriers that need to be overcome for a business to function successfully.
The best way to avoid situations like this and ensure that freight audits are conducted regularly and completely is to hire someone to do it for you. This can be particularly useful for small business owners, as it will free up a lot of their precious time, and also relieve them of stress and frustration. You can learn more about these types of services at ctglobal-freightaudit.com.
3. Not changing the strategy after detecting the problems with freight audits
Source: unsplash.com
One of the important benefits that regular freight auditing provides is the recognition of some patterns that are detrimental to your business. Detecting problems of this type should indicate to you that something is not working in the best way and that it is necessary to immediately change your strategy in order to help your business. Many business owners overlook the fact that a certain situation always recurs in the same way, which prevents them from doing something about it.
For example, you may notice that you pay extra money for weighing cargo due to the inaccurate scales in your company. Insight into this template will help you understand that it is necessary to invest in this piece of equipment and drastically reduce costs in the long run. The same thing goes if you notice that one of the carriers you are cooperating with constantly exceeds the agreed amount of money and charges you more. Such insights will help you make a better plan for your business and save a lot of money in no time because you have eliminated the root cause of the problem.
4. Auditing should come before paying invoices
Source: unsplash.com
Auditing should never come after invoices have been paid. While this sounds pretty logical you would be surprised how many small business owners decide to go through the audit process after paying invoices. This makes no sense for many different reasons. The main one is that, when you notice a problem in time, you can delay paying the invoice until the carrier and you find out why the problem arose and how you can solve it. If you pay the invoice and only then detect that you are an overpaid carrier you can imagine how long it will take to get your money back. And who knows if the carrier will want to return it at all. Well, why would you even put yourself in such awkward situations and ruin your credibility and reputation? Perform freight auditing on time and ensure that your business and cooperation with other companies run smoothly.
Conclusion
Running a small business can be very difficult due to the number of tasks that need to be done each month. Freight auditing is one of the tasks whose regular execution can be a real challenge for small business owners. However, invoice auditing is necessary to prevent additional costs, preserve your reputation and ensure smooth and successful cooperation with carriers. Avoid the mistakes we mentioned, and if you need help, look for a company that provides auditing services and solves the problem in the blink of an eye.
