Why A Parcel Audit Can Help Your Company Reduce Shipping Costs Author: T Nguyen
March 09, 2012

Reducing shipping costs has become an important point of discussion for many businesses with the recovering economic situation.  However, although it may seem easy to accomplish at first, the actual practice is much tougher to implement as businesses must question whether they need to cut services or shipment options.  The great news is that there are some tried-and-true practices to reducing the final balance on an invoice without having to necessarily cut back services to your customers, which should only be used when completely necessary.  One of these options is to conduct a parcel audit, which can be an extremely helpful tool in your arsenal.

A parcel audit is an important way to reduce costs to your shipping.  An employee will look through carrier invoices to check for any mistakes between the carrier's invoice and your initial shipment.  An example of an error would be if a carrier changes the address of the final destination, which would enact an address correction fee.  However, unless this change happens because it impedes the driver’s ability to deliver the package, it is an incorrect fee and should be refunded back to the company.  One easy-to-remember comparison would be to describe this process much like when you are exiting a store, like Costco, and one of their employees checks your receipt to your items for any discrepancies.  They are checking to make sure all the fees are correct and accounted for, just like you are with your parcels.

The reason to perform a parcel audit is because it will help keep you knowledgeable about the transactions being placed on your shipments and ultimately, to reduce your shipping costs by finding these errors.  These audits are to make sure that not only is the carrier rightfully getting what’s owed to them, they are also making sure your company is also getting correctly paid for all included services, which is true of any good business.  To not perform any parcel audits would be glancing over nearly guaranteed savings because of the nature of the shipping business.  Even though carriers like FedEx and UPS have integrated advanced technology to try and automate the shipping process, much of the work still comes across human inputs which allow for a margin for error.

Understandably, conducting parcel audits are not simple.  They require knowledge about what mistakes to find and a task force to physically go through each invoice for each parcel, which can be quite daunting depending on the size of the company and the amount of shipments going out.  Other than hiring in-house auditors, there are trusted third parties that can conduct parcel audits for your company such as Source Consulting.  Don’t let these guaranteed savings get away from your company in this tough economic climate.

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