Automated Billing Improves Cash Flow, Saves Time and Increases Revenue

Workflow Tool Brings Dramatic Improvements to Customer Billing

Mark Reed | ReedTMS Logistics

Managing freight transportation is hard work, so anything that can help getting paid for doing that work is always welcome. The amount of paperwork or documentation involved in the billing process has been and continues to be one of the major challenges.

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The good news is that TMS workflow tools can bring major improvements to the billing process. You can reduce the amount of labor required, you can get bills out faster, and you can avoid billing errors. The result is improved cash flow, increased productivity, better customer service, and boosts in revenue.

Here are some of the ways that you can put a workflow tool to use:

Separate Customer Billing from Carrier Settlements

A common practice for logistics companies is to process each customer bill only after getting the carrier’s invoice. Some software systems use this as a control mechanism for ensuring that all aspects of the billing and settlements process are handled properly. This takes time and it adds days to the entire billing process. But tying the carrier invoice to the customer bill isn’t necessary if your system has other ways to ensure everything is in order. A good workflow tool will allow you to handle customer billing and carrier settlements independently while also improving billing accuracy.

Send BWOP Customer Bills Out Automatically

BWOP customers – those customers who allow billing without paperwork – offer special opportunities for accelerated billing. The billing and settlement workflow tool will begin to monitor each load upon order entry into the TMS. Once the TMS sees that a load has been delivered, the bill is automatically generated and sent out. A good workflow tool will have a variety of options so that you can configure the billing specifications to accommodate the needs of different customers and specific orders.

Use System Checks to Catch Errors

In the fast-paced world of freight logistics, it’s easy to forget to include an accessorial charge on the bill, or to make an error when entering the order. The workflow tool can catch such mistakes before a bill goes out. If there should be a charge for a truck order not used or for detention, the system knows this and tags the order so that the charge is included before the invoice goes to the customer. Also, you can set upper and lower limits on revenue and margin for a load. This way the system monitors the billing amounts, so that a bill doesn’t go out for $10,000 when it should be $1,000, or vice versa.

Once the workflow tool is in place and you’re using it in these ways, a wealth of benefits begins to accrue:

Cash Flow Increases

Get bills out faster and you get paid faster. By separating customer invoices from carrier settlements, you can bill faster because you’re no longer waiting to get the invoice from the carrier. Billing is particularly fast for your BWOP customers, and this helps reduce your days of sales outstanding significantly. There is also another way that your cash flow improves. Now that you don’t need the carrier invoice before billing your customer, you can work with carriers on their schedule. You pay carriers when you get their invoices, but you no longer are prompting them to send the invoices to you so quickly.

Productivity Jumps

Automation of the billing and settlements process reduces the manual labor required by your staff. The workflow tool processes bills without human intervention in most cases and then notifies you when an exception occurs. Your staff has more time to dedicate to other important business, because they’re touching only the bills that require attention.

Customer Service Is Improved

By catching errors before bills go out, you provide more professional customer service. The hassle of dealing with billing errors is a waste of everyone’s time, so the ability to use workflow tools to catch errors before the bills go out is beneficial to all.

Revenue Is Enhanced

How much revenue have you lost because additional charges sometimes get left off the bill? A workflow tool allows you to eliminate those losses without needing to dedicate any additional staff time to the issue. The system monitors each order and ensures that all accessorial or other charges are included before the bill goes out. You get paid everything that you are owed for each order.

Good software tools aren’t free, but if you choose the right ones, they pay for themselves. Workflow tools that help you manage billing and settlements are a perfect example. The return on the investment is there.    

Mark Reed is president of ReedTMS Logistics, an asset-based, third-party logistics provider headquartered in Tampa, FL, with offices in 10 cities in the U.S. He can be reached at [email protected]

Photo Credit: Janaka Dharmasena/