While freight auditing and shipping data analytics with an effective transportation management system (TMS) is a good idea for all shipping, it’s particularly important with less-than-truckload (LTL) freight. It takes useful freight shipping data to know if an LTL supply chain is running efficiently. There are a lot of different data sets shippers can watch, so it’s important to make sure freight auditing and TMS analytics are tracking the right data.
Some key performance indicators (KPIs) are better than others to tell the story of LTL freight shipping effectiveness. TMS and freight auditing can show any number of KPIs, and shippers have to let them know what shipping data they want to see. Here are 11 effective KPIs to monitor with freight auditing and transportation management system shipping data and analytics:
It may seem one of the most obvious data points to track. Utilize freight auditing to ensure that all invoices are accurate. Using freight auditing to ensure billing accuracy is a straightforward way to cut shipping costs and optimize LTL freight shipping supply chain performance. The higher the freight shipping volume, the more savings can be uncovered by freight auditing. Shippers need to find all LTL freight billing inaccuracies, so they’re only paying for what they owe.
Along with freight auditing of overall billing costs, monitoring LTL freight damage is important for savings. Freight damage happens, but it shouldn’t be a common or unexplainable problem. It’s a good idea to track the frequency of freight shipping damage, but also costs that come with freight damage.
Shippers need to track average LTL freight shipping costs. Use TMS shipping software to track this shipping data across several LTL carriers. When shippers can view analytics highlight trends toward lower freight shipping costs compared to other freight data points, supply chain optimization and lower shipping costs follow for logistics management.
Shippers have freight routing guides for a reason. They might as well track compliance to it for inbound freight shipping. Inbound is a usually overlooked, but effective way to cut shipping costs. Shipping data on inbound freight is a good KPI to monitor in case there are frequent issues.
Transportation management system software can also improve logistics management by tracking accepted freight. These TMS analytics can inform shippers of problems with a carrier by tracking when freight is refused and returned.
Another part of freight auditing is shipping data on accessorial charges. Using freight auditing to track percentage of total freight costs made up by accessorials can help with LTL freight rates to cut shipping costs. Freight auditing can also help shippers get refunds on inaccurate accessorials. Combining this data with TMS analytics can lead to improved logistics management and supply chain optimization.
Shippers should know what they’re shipping and how often they’re shipping it. Tracking the number of EDI (electronic data interchange) and API (application program interface) invoices is important. It should also be tracked in terms of freight billing.
The freight industry has been concerned with a capacity shortage. Tracking the LTL capacity that shippers use is key to logistics management. Track both the capacity available in LTL shipments, as well as the capacity the shipment used. Using TMS data and analytics to monitor this will improve supply chain efficiency and reduce freight shipping costs.
A big part of cutting shipping costs is making sure freight is delivered on time. Late delivery can cost shippers. LTL freight shipping can be less consistent than full truckload freight. Freight auditing of proof of delivery can track performance to improve customer satisfaction by enabling a switch to more efficient freight carriers.
LTL freight shipping uses shipment consolidation and route optimization, so it is often most cost-effective. It also has more touch points and frequent stops, so it often poses greater risks for damage, late delivery, and lost freight. It is a good idea to track the percent of all shipments sent through LTL carriers.
A final piece of shipping data that shippers should monitor for LTL freight shipping is carrier performance by carrier. TMS software can provide analytics per carrier to look at performance over all the carriers a shipper uses. It provides easy to see data to help optimize supply chain performance by enabling effective logistics management. It can also decrease shipping costs by being used for leverage in contract negotiations.
Freight auditing and transportation management shipping software is needed to stay competitive in the freight shipping industry. Cut shipping costs, improve logistics management practices, and optimize supply chains by tracking these 11 data points in freight analytics.