Freight Management Frequently Asked Questions
Q: What is my cost to use Freight Revenue Recovery?
A: Our only fees are a percentage of the refunds secured and/or additional savings generated. Standard reports are included at no additional charge. Special reports or certain general ledger coding is available for a flat fee or line item fee.
Q: Which parcel carriers are you auditing?
A: UPS, Federal Express and DHL Express.
Q: We haven't had any customer complaints, due to late packages. Why would we want to use Freight Revenue Recovery?
A: Just because you have no complaints, it does not mean your packages are all delivered on time. On average, 1% to 3% of the packages you ship are late and eligible for a refund. These refunds can add up to significant savings.
Q: We ship a lot of ground packages. Is that service guaranteed?
A: Yes, commercial ground packages have been guaranteed, since May 1998. Effective August 2001, residential ground packages have the same guarantee.
Q: Can you audit inbound packages?
A: Yes, we can audit all shipments, as long as we know the origin address.
Q: Will this service take a lot of my time?
A: No. Using instructions we provide, it takes most customers 5-10 minutes a week to send us the package data download from their shipping systems. If you are willing to convert to Electronic Billing, the process will take none of your time. We will be glad to assist with the conversion to Electronic Billing.
Q: How will I know how much money I am saving and how will I verify the invoice from Freight Revenue Recovery?
A: The invoice from Freight Revenue Recovery is based on the actual refunds secured. These refunds will be deducted directly from your FedEx invoices prior to payment or they will appear on your UPS invoices as credits under the headers "Guaranteed Service Refunds" and/or "Credit Adjustments." For UPS E-Invoice customers, we will produce a separate savings report for you weekly. Freight Revenue Recovery, Inc., will send you an invoice each month for the percentage of actual refunds secured.
Q: How is Freight Revenue Recovery different from other parcel auditors?
A: For starters, we have been in the business since 1977. Additionally, we offer a complete parcel audit - both service audits AND invoice audits. Our staff of seasoned auditors will submit all eligible refunds or credit adjustments to the carrier on your behalf and follow up to ensure your credits are received. Since our revenues are directly tied to your cost savings, you can rest assured that we will go the extra mile to maximize your results.
Do you have any questions about Freight Management that we haven't answered here? Then contact us today!
Ask The Experts
Q: When we file claims against our carriers we often get a response that reads something like this..."Your claim is not valid, and payment is declined in full because your claim has been filed past 180 days." What does this mean, and is there anything we can do about it? - R.B., Atlanta, GA
A: Certainly! It's amazing how quickly the majority of the nation's carriers embraced the 180-day provision of the Transportation Industry Regulatory Reform Act (TIRRA) in order to avoid returning to their customers money due them for legitimate overcharges.
However if you have contracts with your carriers, which is the case in practically all freight shipments today, TIRRA simply does not apply. In a ruling, the Surface Transportation Board also confirms that, "There is no legal prohibition against correcting a billing error or settling a claim that was not timely raised."
Many of our freight shippers now have included in their carrier contracts an overcharge recovery period that ranges from one to three years. The ICC Termination Act permits a carrier and shipper to agree in writing, "to waive any or all rights and remedies" for transportation grounded under contract. With the growing tendency of many carriers to try to avoid responsibility for settling claims beyond 180 days, the inclusion of a longer claim period in the contract is now a virtual necessity.
If you have a freight question, please give us a call, drop us a note or send a quick email!
Freight Mgmt Tip
"FREE Freight Shipping"
As most shippers know, within each LTL carrier's rate group there is a weight (referred to as "weight break") where it is cheaper to rate the shipment at the lowest weight provided for in the next- heaviest weight group at the rate assigned to that weight group. In other words, you can add weight to a shipment until you reach the lowest weight in the next-heaviest weight group, and not pay an extra cent for any of that added weight.
Weight breaks vary, not only according to distance, but by weight groups as well. In addition, they can vary from carrier to carrier. In one example of a class 70 shipment from Massachusetts to Los Angeles, the weight break on shipments weighing between 5,000 and 9.999 pounds is 8.296. Once you hit that weight, you can throw in an extra 1,734 pounds with no increase in the freight charges.
By making your sales and purchasing people aware of the deficit-weight aspect of motor carrier LTL pricing, you could open up opportunities for them to sell (or order) in greater quantities than they might otherwise do, with no added freight charge. It's a powerful incentive.
Overcharge Spotlight
This really should have been a cut and dried calculation. Our client was moving a truckload of mineral compounds from South Carolina to Michigan, a distance of 682 miles at a rate of $1.07 per mile. Anyone dealing with figures should know that the charge should have been in the $700 range. But somehow, the mileage was entered as 6682, and the computer obligingly produced a freight bill of $7,149.74.
Now, we're all smart enough to know that 6682 miles would get us further than from South Carolina to Michigan - maybe even all the way to South Borneo. (Well, all of us except the computer.) But our auditor, who was post auditing our client's bills, knew it, so he corrected the bill to $729.74 (682 miles@$1.07/mile) and filled an overcharge claim with the carrier. A check from the carrier for the $6,420.00 overcharge was received in due course.
Interestingly enough, this is the kind of error that falls outside the federal statute of limitations for filing overcharge claims. It is an arithmetic error, having nothing whatsoever to do with transportation law, and it is subject only to the state statute of limitations.