The nature of logistics and the freight business requires continuous infusion of funds to run operations. Much of the expenses are incurred on behalf of clients and the payment is realized only at a later date, mostly after a brief notice period post-delivery of the shipment. Keeping tabs on expenses incurred on behalf of a client can be tedious as companies handle shipments of a number of clients simultaneously.
With the needs of the logistics and freight industry being unique, standard accounting software are not fully equipped to adequately handle finance and accounting. As multiple expenses are incurred at every stage of the shipment, recording the expenses shipment-wise and accounting for receivables and payables can become a formidable task. Any bungling in the accounting process may lead to cost overruns and loss of revenue with disastrous effects on the business.
In many cases you find due process is not set as the standard software does not allow for it. There is much confusion and lack of discipline in the accounting process. The companies find themselves in a financial mess and the finance department is hard pressed to stop the revenue leakages.
Free Demo!So what is the apt solution? The answer is a single software that covers the logistics and freight business end-to-end with seamless incorporation of finance and accounting. A single end-to-end software with accounting incorporated in it makes it easier for logistics and freight companies to introduce financial discipline and control. Companies can not only reduce and save on their resources by over 40% but also stop cost overruns and increase inflow of revenue using a single software.
In addition, capturing or recording the expenses as and when they occur becomes possible preventing lapses in booking of charges. Invoicing becomes easier and error-free as all charges are pre-booked, automating the invoice generation process and thereby reducing errors leading to loss of revenue.
Tighter credit control is achieved with enhanced transparency and checks and balances in place ensuring that clients do not exceed their credit limits and payments recovery processes are initiated in time.
Payment follow-up, which is one of the most critical areas of weakness in logistics business, becomes easier and automated.
The single end-to-end software designed specifically for the unique needs of the industry can help businesses have the upper hand in financial matters. It introduces much-needed discipline and control over the financial and accounting process of the company and thus makes it easier for business to prevent slipping into a financial mess.
Originally Published in Portcalls Asia Magazine
https://www.portcalls.com/financial-discipline-and-control-in-logistics/
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