Guessing if costs are being allocated to the correct departments or projects is no way to run a business. There can be no guesswork in today’s highly competitive global market, as understanding and controlling logistics costs are critical.
As supply chains become increasingly complex and freight rates fluctuate wildly, shippers are under constant pressure to streamline their processes and reduce costs. But inefficient – and inaccurate – cost allocation can actually result in overspending and missed opportunities for margin improvement.
Modern freight finance solutions are helping shippers address these efficiencies and providing them with the tools they need to achieve greater financial accuracy, transparency, and optimization. A leading solution is found in Owlery’s Freight Finance Tools, which are designed to transform how shippers approach logistics cost allocation and financial management.
Accurate cost allocation is not just a matter of bookkeeping; it has a direct impact on a company’s overall financial performance. Without a clear and accurate picture of logistics costs, it’s nearly impossible to make data-driven decisions that drive long-term success.
Businesses that allocate freight costs efficiently are able to make better strategic decisions. By utilizing the advanced tools available, they are able to understand the true cost of transportation and properly allocate costs – and ultimately improve enterprise wide operational efficiency and financial performance.
Too many shippers still rely on outdated, manual processes for managing logistics costs. These can include time-consuming invoice reconciliation and result in poor visibility into real-time data and inaccuracies in cost tracking.
Back-office personnel almost always have a lot on their plates, and the more we have to do, the more likely it is that something will slip through the cracks. The manual reconciliation of invoices in particular is prone to human error, making it difficult to identify discrepancies between the actual freight costs and the agreed-upon contract rates. Without integrated systems to track costs in real time, shippers can be left guessing at their total logistics expenses. That leaves them exposed to overspending.
Inaccurate cost allocation can result in more than just accounting headaches; it can have serious implications for a business’ bottom line. Overspending on freight costs or failing to identify areas of inefficiency can lead to reduced profit margins, strained relationships with carriers and customers, and lost business opportunities. When cost allocation isn’t handled correctly, the ripple effects can spread across the supply chain, undermining operational efficiency and threatening long-term financial stability.
One of the most common pain points in logistics cost management is the time-consuming and error-prone process of auditing invoices. Traditional methods often involve manual cross-referencing of invoices with contracts and purchase orders, a process that can take days. Discrepancies in pricing or billing errors can even go unnoticed, which ultimately results in higher-than-expected expenses.
Owlery’s automated invoice auditing tool removes the complexity of this process by cross-referencing shipment data, contracts, and purchase orders with carrier invoices. This ensures a higher level of accuracy and speeds up the auditing process. Automated tools also minimize the risk of human error, making the process both faster and more reliable. The result is improved cost visibility, reduced operational overhead, and a faster time to resolution when discrepancies are detected.
Understanding the granular breakdown of logistics costs is essential for businesses seeking to optimize their spend. A one-size-fits-all approach to cost allocation is no longer effective in today’s complex supply chain environment. By breaking down costs by shipment type, lane, and carrier, businesses can identify inefficiencies, optimize routing, and negotiate better contracts with service providers.
Owlery’s dynamic cost allocation analytics tools provide businesses with real-time insights into their logistics expenditures. These tools allow users to drill down into the specifics of their costs, whether by lane, carrier, or shipment type. With these insights, companies can make more informed decisions about which carriers and routes offer the best value, as well as identify areas where they may be overspending.
By analyzing shipping lanes, for example, businesses may find that certain routes are consistently more expensive than others, even when factors like distance and weight are similar. With this knowledge, they can either negotiate better terms with the carrier or adjust their operations to reduce costs. The ability to continuously analyze cost data empowers businesses to stay ahead of market trends, make smarter decisions, and optimize their logistics spend in real time.
Compliance is a critical issue in logistics finance. Accurate accrual reporting ensures that companies are in line with financial regulations and avoids issues like noncompliance with contractual terms. Accurate accrual reporting also supports internal financial transparency, which is key for maintaining stakeholder confidence.
Owlery simplifies the accrual reporting process by providing real-time tracking and detailed financial reporting capabilities. These features make it easier for businesses to stay on top of their financial obligations, providing a unified view of their logistics expenses and ensuring compliance with both internal and external reporting standards. By streamlining this aspect of logistics finance, Owlery helps businesses avoid costly compliance mistakes while giving them a clearer understanding of their financial position.
One of the standout features of Owlery’s freight finance tools is its seamless integration with enterprise resource planning (ERP) and order management systems (OMS). These integrations allow companies to gain a unified view of their logistics costs, bringing together data from various departments and systems into a single, comprehensive platform.
By integrating freight finance tools with ERP and OMS systems, shippers can access real-time data on freight costs, carrier performance, and market trends, allowing them to make quicker, more informed decisions. For example, businesses can track carrier performance metrics and adjust contracts accordingly, ensuring they are always getting the best value.
Real-time data access is key to staying competitive in today’s fast-paced logistics environment. Owlery’s integration capabilities give businesses immediate access to live data on freight costs, providing a clear view of how much is being spent on transportation at any given time. This allows for quicker adjustments and more responsive cost management.
Owlery’s predictive analytics tools enable shippers to forecast future freight spend. By analyzing past data, logistics teams can predict which shipments are likely to incur higher costs and take proactive steps to address inefficiencies before they arise.
A transparent, data-driven approach to cost allocation fosters stronger relationships with carriers and customers. By sharing performance metrics and accurate financial data, businesses can negotiate more favorable contracts based on real, objective performance data. This not only helps optimize costs but also strengthens long-term business partnerships.
Understanding logistics costs and allocating them accurately is essential for optimizing financial performance in today’s supply chain landscape. As global trade becomes increasingly complex, businesses need modern solutions that provide real-time insights, automation, and advanced analytics. Owlery’s freight finance tools empower businesses to gain complete control over their logistics costs through cutting-edge automation, detailed cost allocation, and actionable insights.
By leveraging Owlery’s suite of solutions, shippers can streamline their cost allocation processes, improve carrier relationships, and ensure financial compliance — all while making smarter, data-driven decisions that lead to better profitability.
Controlling costs is more critical than ever. Inaccurate cost allocation can lead to overspending, operational inefficiencies, and missed opportunities. Modern freight finance solutions like Owlery’s freight finance tools offer shippers the ability to optimize cost allocation, improve accuracy, and gain real-time insights into their logistics operations.
Through automation, advanced analytics, and seamless system integrations, Owlery’s modern TMS transforms the way businesses approach cost management in logistics. By understanding and controlling these costs, businesses can make better strategic decisions, strengthen relationships with carriers, and ensure long-term financial success.
Logistics teams at such companies as Local Bounti, Daily Harvest, Force of Nature, and Ollie love our transportation management system (TMS) and supply chain platform. They quickly discovered the power, visibility, and control that the Owlery TMS provides.
The Owlery TMS stands apart from others on the market because of our:
Shippers rave about our exception management tools; integrated quoting and tendering for any carrier and mode; centralized tracking data; in-depth reporting and analyses; prebuilt shareable scorecards; and centralized bills of lading and receipts.
Get started with Owlery today and discover how our freight finance tools can help you take control of your shipping costs and improve your bottom line.
