How To Get Detailed Transportation Spend Cost Data

Improving profitability hinges on just a handful of factors, one of the most important being managing operating costs. It’s no secret that the cost of moving goods through the global supply chain continues to rise. 

Manufacturers and shippers have to balance sky-high customer expectations with the rising cost of fuel, warehousing, logistics, and more. These pieces might be more manageable for businesses operating in a single market, but what happens as your business scales to include markets in each corner of the globe?

The simple answer is that visibility is dramatically reduced, potentially causing costs to spiral out of control. The only way to resolve this is through comprehensive and reliable data. Before the heart palpitations begin, let’s get through the good news. Regardless of the level of an operation, millions of data points are accessible with the right tools in place.

At Trax, we help global enterprises improve visibility and reduce operating costs through supply chain data. With tools powered by AI and machine learning, our partners have access to reliable data in real time to help them optimize transportation spend.

The Importance of Data Reliability

Before we go any further, we have to call a spade a spade. Manually collected data in supply chain management is unreliable at best. That might be hard to hear, especially when the success of a business is on the line.

The fact is that most organizations that operate in multiple markets, with an extensive supply chain network are beholden to third-party data. On the surface, third-party data isn’t a bad thing. It shifts the burden of gathering information away from the organization.

For years, the argument for third-party data has focused on the fact that it can help reduce operating costs, making it easier to scale. The truth is that it does the exact opposite.

While it is true that the burden is removed on the front end, it creates a tremendous workload on the back end of the process. Collecting, deciphering, and trying to extract grains of truth become incredibly complex, hindering the entire process. And that is assuming that the information is complete.

Far too often, businesses are left with only a portion of the information needed to drive results and reduce costs. Before the introduction of modern supply chain management technology, the muddy water created by third-party data was simply a necessary evil that every organization had to deal with. Today that has dramatically changed thanks to tools such as artificial intelligence (AI) and machine learning. As data reliability improves and processes become streamlined, not only are costs reduced, but scaling your business becomes much more feasible.

Accessing Reliable Transportation Spend Data

So how do you get there? How can you gain access to more accurate and reliable data? First off, there is no magic wand. Improvement takes time, but ROI isn’t hard to find when you have the right systems and processes in place.

Aggregate Information

The first step in the process, and a piece that should be central to any transportation management spend system, is to aggregate data into a single source of truth. At its core, this is connecting the various components of your supply chain network so that all data flows through a single system.

Tools such as freight audit and payment (FAP) platforms allow you to manage the entire invoicing process from start to finish within a single solution. This does a couple of things to help improve data reliability.

First and foremost, it makes organizations less reliant on outside processes to get information, resolving information gaps and delays. They are instead replaced by accurate reporting that can be accessed at any time, improving the decision-making process.

Additionally, it shifts where the freight audits occur in the process. Traditionally, audits have been conducted well after payment is issued. This leads to constant back and forth as billing discrepancies are resolved. Costs will naturally go down by moving the audit process to the front of the line through reliable data.

The challenge for most organizations is that they are looking for a quick fix. Aggregating information takes time, especially when an extensive supply chain network is involved. But the proof is clear: once data is streaming into a single source platform, transportation management spend will improve.

Leverage AI

Connecting and aggregating supply chain data addresses where data originates and how it is stored, but it is only one piece of the puzzle. The simple fact is that millions of data points will be streaming on the platform of choice each day. Getting through all of that information can be an overwhelming task.

Access isn’t just about having mountains of data at your fingertips; you have to be able to turn that into actionable information. AI has changed the way that information is processed and the speed at which insights are available.

Addressing an influx of data with manpower leaves much to be desired. Even the best auditors will miss critical information simply because they do not have the time to thoroughly inspect each piece of information. Artificial intelligence, on the other hand, is designed to scan information, flagging discrepancies when they appear. Freight rates, regulatory compliance, and other constantly changing pieces can all be monitored more efficiently with AI doing the heavy lifting.

Flagged information can then be processed by team members, who are, in turn much more efficient, allowing the business to save money on overhead, and more effectively scale.

Improving Transportation Spend Management

As the supply chain and management of supply chain networks become increasingly more complex, having tools and systems in place becomes essential to reducing transportation spend. With data as the crux of the operation, visibility into each area of the network improves, making it easier to make hard decisions that impact the organization's bottom line.

Trax empowers enterprises with globally complex supply chains to gain full control of their transportation costs. By implementing the Trax freight audit and payment system (FAP), the leaders of large-scale companies have been able to reduce costs, improve profitability and scale their operations successfully.

To learn more about our suite of transportation spend management solutions, connect with our team and get started today.