CASE STUDY

Zeroing In on Freight Cost

How a Global Consumer Goods Company Gained Accurate Cost Estimates

A leading global consumer goods company struggled with inaccurate freight cost estimates, making financial forecasting and planning a challenge. With delays in receiving final invoices and cost variations up to 40%, the company turned to Trax to gain advance visibility into inbound freight costs and improve cost accuracy for better decision-making.

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Challenge (1)
THE CHALLENGE

The Struggle for Accurate Freight Cost Visibility

The company encountered significant issues due to a lack of timely information regarding freight costs. Final invoices often arrived well after shipments, leading to discrepancies in freight cost estimates that varied as much as 40% from actuals. This situation made accurate financial planning and forecasting extremely difficult, resulting in:

  • Inability to predict freight costs accurately, complicating budget management.
  • Delays in receiving final invoices, leading to cash flow challenges.
  • Difficulty in making informed decisions regarding product sourcing and manufacturing locations.
THE TRAX SOLUTION

A Data-Driven Approach to Freight Cost Estimation

Trax designed and deployed a solution that analyzed carrier advance shipment notices (ASNs) and applied the company’s negotiated rates to generate accurate freight cost estimates in near real-time. The system included:

Advanced Shipment Analysis

Analyzed carriers’ advance shipment notices (ASNs) and applied contractually negotiated rates to accurately calculate estimated freight costs.

SKU-Level Cost Allocation

Combined purchase order and ASN data to allocate freight costs at the SKU level based on weight using a frequency-based distribution algorithm.

Closed-Loop Reconciliation

Enabled closed-loop analysis for reconciling shipped goods against invoiced amounts and making necessary corrections.

Results (2)
THE RESULTS

Achieving Precision and Cost Savings in Freight Management

The implementation of Trax's solution led to significant improvements for the consumer goods company, including:

  • Visibility of estimated spend costs by the second day of the following month, reducing estimated variance from 40% to just 2%.
  • Enhanced ability to analyze total cost of ownership (TCO) at the SKU level, enabling informed decisions about product manufacturing locations and regular savings of 2-4%.
  • Establishment of a closed-loop analysis process to reconcile shipped versus invoiced amounts, allowing for timely corrections as needed.

Ready to Take Control of Your Freight Spend?

Download the full case study to learn how Trax helped this global brand streamline freight cost allocation, reduce manual effort, and unlock new savings—at scale.


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Zeroing In on Freight Cost

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