Freight Spend Management

Freight spend management is the ongoing discipline of understanding where your transportation dollars go, whether they're being spent efficiently, and where opportunities exist to reduce cost. It spans the full invoice lifecycle – from accrual at the time of shipment through invoice receipt, audit, approval, and payment – and extends into analytics that reveal spending patterns, cost drivers, and optimization opportunities.

For most mid-market shippers, freight spend is the second or third largest operating cost line, yet visibility into that spend is surprisingly poor. Invoices arrive from dozens of carriers in different formats. Charges get paid without validation against contracted rates. Accessorial fees accumulate without anyone tracking patterns. And cost allocation to customers, products, or business units requires manual spreadsheet work that's always behind and never quite accurate. The result is a freight budget that's reactive – the team knows what they spent last quarter, but they can't explain why it was higher than planned or where to cut.

Effective spend management requires three capabilities working together: real-time visibility into freight cost as shipments move (not after invoices arrive weeks later), automated invoice auditing that validates every charge against contracted terms, and analytics that slice spend by the dimensions that matter – lane, carrier, customer, mode, and time period. When these three work in concert, the logistics team can forecast accurately, catch billing errors immediately, and surface cost-saving opportunities proactively rather than discovering them during annual budget reviews.

The payoff is significant. Industry estimates suggest that 3–7% of freight invoices contain errors, and most of those errors favor the carrier. Shippers without automated audit processes are almost certainly overpaying – not because carriers are dishonest, but because freight billing is complex and manual review can't keep up with volume.