What Do Freight Payment Service Providers Offer & What Are the Benefits?

For companies to grow and scale, adopting freight payment services that strengthen specific business processes is absolutely necessary. The multitude of advantages that technology provides allows parties across the board to benefit in many ways. Not only do these tools amplify efficiency but they also mitigate risk and lower costs.

They Offer Broker, Third-Party, and Carrier Factoring

The best freight payment companies offer broker and third-party factoring at a flat rate through accessible and streamlined technology. Other beneficial services include providing financing for receivables to freight brokers and offering quick pay at various rates to carriers. Another serviceable feature is carrier factoring with no minimums, no reserve, and a low flat rate. This provides carriers with obtainable options when trying to secure the best hauling contracts.

Load Board Integration Payment Management Helps to Keep Freight Moving Without Added Costs

The digital technology that freight payment service providers offer for shippers and brokers keeps freight flowing smoothly and substantially reduces costs. Integrating online load boards (that offer a listing of digital freight options) allows shippers/brokers to post loads and gather bids on freight from the expansive pools of quality options (from other brokers and carriers). Through this service-enhancing method, negotiating rates becomes simplified and instantaneous, including lane matching with real-time alerts when loads and trucks match. The accessibility that these tools provide allows for a shipping company to accurately measure capacity and have access to the best terms possible.

Prepaid vs. Collect Freight Are Other Options for Those With High Uncertainty

Having different options on freight arrangements eases uncertainty. With a prepaid option, the shipper is responsible for shipping charges and ancillary expenses. When using the collect freight option, the receiver covers the freight charges. This is also known as “collect upon arrival,” and includes any additional shipping charges.

Digital Credit and Cost Underwriting Is Useful to Helping Unlock More Value With Limited Resources

In the modern supply chain network, freight payment providers should offer solutions that empower logistics companies to grow. Even if a business has limited resources, unlocking potential opportunities should still be a possibility. Integrating a digital credit and underwriting platform to establish or maintain credit is key for growth and mitigating risk. As further explained by Jack Glenn of FreightWaves, “Not only does credit insurance allow companies to mitigate risks beyond their control and protect against non-payments, that same credit insurance also allows companies to explore growth opportunities with existing customers. Insured companies can sell on open account terms where they may have previously been restrictive or only sold on a secured basis.”

Benefits of Multiple Freight Payment Services

With a wide array of freight payment services and options, companies reap the benefits of convenience. Many manual processes have been replaced with modern technology that enhances business and amplifies efficiency. These accessible options allow organizations to lower costs and scale through automation without a significant amount of money or change. As these tools can be integrated with current systems, no rehauling of the entire system is required. These benefits include:

  • Better cashflow – Streamlined tendering and transactions allow for automated payment collection, for both commercial invoice processes and regular invoice processes.
  • Fewer delays in getting paid – No more confusion or delays on payments that cost the company valuable time and resources.
  • Lower risk – Risk is mitigated and minimized through accurate reporting and invoicing.
  • Increased cost forecasting – Insight and analytics provide companies with a deep understanding of current rates and deals.
  • Improved driver and employee morale – With magnified awareness, optimal deals can be generated resulting in both driver and employee satisfaction.
  • Business reputation gains – Good and fair business creates a reputation that has a ripple effect across the entire market, which leads to more customer acquisition.

Start Reaping the Rewards of Digital Freight Payment Services with HaulPay by ComFreight

In the modern fast-paced transportation market, businesses must do everything they can to stay ahead of the curve. By offering freight payment services that benefit shippers, brokers, and carriers, companies can exponentially grow without the major risk often associated with change. Improving business no longer has to come with overwhelming challenges. Start succeeding. Request a HaulPay demo today.

What Is and What Are the Types of Freight Payment Services & Options

Today more than ever, managing payment reporting and providing logistics excellence within the supply chain is essential for achieving continued growth and profitability. Finding the right mode of transportation can be challenging enough, but securing payments can be equally daunting. Network managers must balance local needs and restrictions with an increasingly global focus on transportation management and various freight payment processes. And with transportation costs increasing around the world, cost controls and guidelines have become more vital than ever for the modern-day transportation network manager. 

What Does Freight Payment Services Mean?

Freight audit and payment are vital services that keep the supply chain functioning smoothly by ensuring payments are made and received for services rendered during shipping. The freight payment process focuses on auditing and paying freight invoices promptly to prevent missed opportunities and payment delays. It also focuses on collecting the data needed to create records and reports that track freight spend, commercial invoices, and logistics payments throughout the supply chain. Global managers aim to standardize practices and collaborate with a worldwide partner to solve  challenges. The key to freight payment services is managing these expenses and overcoming difficulties with invoices and payments as efficiently as possible within the network.

Problems Surrounding Traditional Logistics Payment Processes

One of the most significant challenges associated with freight payment services is cost management. Reducing freight spend and lowering shipping overhead costs is vital for ongoing growth in today’s competitive global market. Any way the freight payment process can improve is critical. According to The Journal of Commerce Online, reducing freight spend can have a tremendous impact on profitability. Consider this: A shipper with $1 billion in revenue could end up paying $50 million to $100 million in freight spend. This same company could end up managing over 40,000 invoices in a single year. All of these costs and expenses can quickly add up and eat into profits. Therefore, freight payment process management is critical to achieving sustained profitability.

Defining the Top Types of Freight Payment Services

Knowing the various freight payment meanings is critical to understanding how they can impact the supply chain network. Developing industry and company-specific freight carrier payment terms can help managers to easily determine the right freight payment services for their unique needs. Some of the more common options include:

Broker or Third-Party Factoring

Freight brokers provide financing and payment reporting on behalf of the company, usually for a flat-rate fee, which enables shippers and carriers to focus on tasks other than invoicing. This is thanks to the use of online dashboards, apps, and innovative software.

Carrier Factoring

This unique option provides services with no minimums, no reserve and a low flat rate. Carriers experience additional peace of mind while securing the best rates with easy-to-follow steps that help to streamline the freight payment processes.

Load Board Integrated Payments

Shippers and brokers use online load boards to post loads and get bids from a vast pool of brokers and carriers. This allows for faster capacity management, easier rate negotiation, and access to the best freight carrier payment terms.

Prepaid Freight

When logistics managers and directors have a general idea of what their freight loads will cost to ship, a prepaid approach may help free up team members and give management one less concern.

Collect Freight 

This option for supply chain payment reporting focuses on the amount of freight that gets transported and presents the shipping rate based on volume, weight, or several shipments made. This method is based on a predetermined base fee.

Digital Credit and Cost Underwriting

Additional fees such as inspections, legal fees, customs and duty fees, and similar operational expenses also need to be considered when managing payments and finding the correct freight carrier payment terms. 

Maximize Profitability Quickly and Easily With the Right Freight Payment Options

From implementing the right freight payment software and processes to choosing from among the many types of freight payment available, it is essential that the freight payment services align with the needs and goals of the transportation service providers implementing them. Get a demo today of HaulPay, a ComFreight product, to see how the platform streamlines freight payment processes.