Logistics Outsourcing

Freight billing might seem an easy task to carry out; you have goods that you need to ship, they reach the recipient, you pay the carrier for delivery. However, experienced professionals working in the shipping and logistics industries know what it takes to successfully manage the entire process, starting from generating invoices to collecting payments.

What is Freight Billing?

A freight bill is a document of a contract between a shipper and a carrier. The bill generally contains information such as a description of items (Quantity & weight), pickup time/date, and the deadline for delivery (usually for time-sensitive deliveries). Other essential details include shipper and carrier information, signatures, charges (shipping fee + taxes), and payment method.

Freight billing may vary from carrier to carrier; thus, it’s essential to review all of the details carefully. This careful review of the freight bill is called a freight audit.

Freight Billing Process

Companies usually have a standardized freight billing system; a few necessary steps the freight billing process must include.

  • Contract agreement from both shippers and carriers is vital.
  • When goods delivered, the carrier must issue an invoice to the shipper.
  • Invoice validation: preventing double payment.
  • Collection of invoice data for analysis.
  • Invoice validation: preventing double payment.
  • Collection of invoice data for analysis.
  • Verification: the amount (to be paid) is audited against the services acquired.
  • Accounting requirements: a ledger code is added.
  • Payment against invoice and its storage for records.

These steps, when followed correctly, can help run the billing process effectively. Still, freight bills often have errors. Incorrect documentation of fuel pricing, non-removal of waived costs, typographic mistakes, etc. are the most common discrepancies that arise due to human error.

Several businesses in the industry face issues due to mistakes in invoices, affecting further operations, delaying payment settlement. While dealing with late deliveries and the replacement of damaged goods, you must keep a keen eye for how the freight bill of lading and relevant processes are handled and where the bottlenecks are.

Optimize Freight Billing

Due to its importance, many companies have found logistics outsourcing services as an optimum solution for issues concerning freight billing and its management. Getting external help with freight bill management ensures the entire process is handled well. Outsourcing saves time and capital; it can also help address several other process-related issues while reducing errors.

According to one survey, 65% of shippers worldwide outsource warehousing activities to third-party logistics providers.

Why Outsource Freight Billing Management?

 1. For Quality Data Management & on-time Document Processing

Logistical operations create and require piles of paperwork including, freight bills, permits, bill of lading, load verification documents, shipping documents, etc. The real labor-intensive work starts when it comes to processing these documents that require several human and technology resources.

Outsourcing bill of lading data entry and logistics document processing helps manage operations better and meet time-sensitive targets. A higher level of accuracy and care is required to record, digitize, and process the documents; the same can easily be achieved through outsourcing services.

 2. To Enhance Operational Visibility and Accuracy

The main reason you might want to outsource logistics services is to efficiently manage core operations and have accurate, quality data about freight bills for service-improvement decisions. As most of your workforce remains busy with important operational activities or might not perform multi-tasking, some back-office functions (like data entry) are often overlooked or scheduled for spare time.

This can hinder the quality of data and cause delays. Whereas, if you choose to outsource, you can rest assured that your processes are being handled by experts using smart automation, delivering high-quality outcomes with absolute accuracy within the defined turnaround time.

3. For Faster Billing, Quicker Payment

Your shipping partners, for example, carrier companies, expect quick payment once they deliver your shipment. Outsourcing can fasten the processing of bills and payment; these firms have industry experience, technical expertise, and stringent quality checks that can help you process freight bills quickly with greater efficiency. The experts also ensure the elimination of incorrect amounts, freight rates, overcharges, double billing, overdue invoices, and others.

When you easily get quality and accurate information regarding your bills, you can make payments on time, which helps manage cash flow and revenue streams efficiently. 

4. To Increase Data Security

Increase Data Security

Logistics documents, including load confirmation statements, freight bills, and bill of lading, contain confidential information. This data must be protected at all costs. With logistics outsourcing, you can ensure this sensitive data is in responsible hands. A trusted outsourcing partner will not only ensure delivering authentic data sets but also keep your information secure by storing it in highly-protected storage spaces.

5. To Reduce Labor & Administrative Costs

Outsourcing logistics back-office functions that are often time-consuming and repetitive enables you to save notable labor and administrative costs. You need not hire permanent employees for data entry and bill processing, saving significant capital that you might otherwise invest in staffing.

You can simply transfer these responsibilities to your outsourcing partner to ensure desired results at lower prices and cut operating costs by up to 30%.

6. To Take Advantage of Scalable Solutions

As your business will grow with time, you will need to expand your staff because as the order volume increases, so does the work and load of documents.

While having a reliable outsourcing firm by your side, you would not face issues managing the increased demand and staff requirement. Your partner can easily tailor services according to your business needs. This enables you to expand work scope to accommodate market needs with the highest possible accuracy in real-time.

7. To Improve Overall Customer Service

By optimizing freight billing, bill of lading processes with the help of logistics outsourcing services, you can enhance customer experiences at large.

As errors and double billing are now a thing of the past, paperwork is carefully being digitized, bills are processed accurately, shipments are delivered within deadline, your customers will automatically become happier. This also leads to satisfied customers (having a better experience with your company) coming back to you.


Freight billing is essential to the shipping process since it protects all parties involved and lays out specifics for delivery. Accurate freight bill processing starts by working with a trusted freight bill entry and document processing company such as Cogneesol that ensures accuracy, timeliness, and cost-effectiveness (critical factors to freight bill processing) are met. It requires an understanding of common industry vocabulary that we have and utilize to deliver outstanding logistics back-office services.

While your in-house team might find it challenging to handle the workload, our extensive experience, and skilled resources can provide you with complete support by offering scalable solutions to meet your requirements at different phases. To know more about our services, feel free to get contact us. Call us at +1 646 688 2821 or send your query at info@cogneesol.com.

Also Read: Why Bill of Lading is the most important part of Logistics and Shipping

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