Short engaging headline

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Modernizing freight audit and pay solutions for a future-ready supply chain

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Contents

Taking freight audit and pay solutions to new levels 1

Automation innovation ndash how technology is changing FAP 2

Keys to a successful FAP implementation 3

Benefits of a successful FAP implementation 5

Next steps 6

How KPMG can help 7

iiiFreight Audit and Pay White Paper

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Taking freight audit and pay solutions to new levelsManual invoicing lack of financial transparency and exceptions continue to create major struggles for organizations that manage freight transactions The sheer volume of transactions exacerbates the challenges of paperwork multiple regulatory and tax environments lack of uniformity in rates and invoice formats and time-consuming approvals emails and phone calls According to a study from by Kuebix Resources1 15 percent of freight bills contain errors Recent research by Drewry Supply Chain Advisors found that the liner shipping industry ldquois exposed to $344 billion in invoice and payment processing inefficiencies based on 126 billion invoices issued in 2017rdquo2 A large-volume shipper told industry observer JOCcom ldquoItrsquos absolutely true that carriers overcharge If you keep the papers moving around enough yoursquoll give up and pay me And therersquos no good way to get that money backrdquo3

Organizations can now take advantage of innovations in technology to automate the process of paying and auditing payments to carriers thereby reducing their administrative burden Industry-leading companies are hiring third-party services or building automated freight audit and pay (FAP) processes in-house to streamline invoice auditing reduce costs of processing invoices and improve financial transparency FAP technology may or may not be a component of a transportation management system (TMS) Yet companies have invested millions in FAP upgrades without achieving an acceptable ROI Why

Even with new FAP technology at their disposal companies have been derailed by traditional problems including inaccurate or outdated contract information such as lane rates accessorials or fuel costs vendor confusion because of inaccurate DBA or other identifiers lack of duplication protection controls and lack of a defined process for managing invoicing discrepancies It turns out success of an FAP upgrade depends on the quality of the implementation

1Kuebix Resources Stop Manually Auditing Your Transportation Freight Bills Transportation News August 17 2018 httpswwwsupplychain247comarticlestop_manually_auditing_your_transportation_freight_bills2Johnson Eric Why container freight invoicing automation hasnrsquot taken off JOCcom September 13 2018 httpswwwjoccomtechnologywhy-container-freight-invoicing-automation-hasnrsquot-taken_20180913html3Ibid

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Contents

Taking freight audit and pay solutions to new levels 1

Automation innovation ndash how technology is changing FAP 2

Keys to a successful FAP implementation 3

Benefits of a successful FAP implementation 5

Next steps 6

How KPMG can help 7

iiiFreight Audit and Pay White Paper

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Taking freight audit and pay solutions to new levelsManual invoicing lack of financial transparency and exceptions continue to create major struggles for organizations that manage freight transactions The sheer volume of transactions exacerbates the challenges of paperwork multiple regulatory and tax environments lack of uniformity in rates and invoice formats and time-consuming approvals emails and phone calls According to a study from by Kuebix Resources1 15 percent of freight bills contain errors Recent research by Drewry Supply Chain Advisors found that the liner shipping industry ldquois exposed to $344 billion in invoice and payment processing inefficiencies based on 126 billion invoices issued in 2017rdquo2 A large-volume shipper told industry observer JOCcom ldquoItrsquos absolutely true that carriers overcharge If you keep the papers moving around enough yoursquoll give up and pay me And therersquos no good way to get that money backrdquo3

Organizations can now take advantage of innovations in technology to automate the process of paying and auditing payments to carriers thereby reducing their administrative burden Industry-leading companies are hiring third-party services or building automated freight audit and pay (FAP) processes in-house to streamline invoice auditing reduce costs of processing invoices and improve financial transparency FAP technology may or may not be a component of a transportation management system (TMS) Yet companies have invested millions in FAP upgrades without achieving an acceptable ROI Why

Even with new FAP technology at their disposal companies have been derailed by traditional problems including inaccurate or outdated contract information such as lane rates accessorials or fuel costs vendor confusion because of inaccurate DBA or other identifiers lack of duplication protection controls and lack of a defined process for managing invoicing discrepancies It turns out success of an FAP upgrade depends on the quality of the implementation

1Kuebix Resources Stop Manually Auditing Your Transportation Freight Bills Transportation News August 17 2018 httpswwwsupplychain247comarticlestop_manually_auditing_your_transportation_freight_bills2Johnson Eric Why container freight invoicing automation hasnrsquot taken off JOCcom September 13 2018 httpswwwjoccomtechnologywhy-container-freight-invoicing-automation-hasnrsquot-taken_20180913html3Ibid

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Contents

Taking freight audit and pay solutions to new levels 1

Automation innovation ndash how technology is changing FAP 2

Keys to a successful FAP implementation 3

Benefits of a successful FAP implementation 5

Next steps 6

How KPMG can help 7

iiiFreight Audit and Pay White Paper

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Taking freight audit and pay solutions to new levelsManual invoicing lack of financial transparency and exceptions continue to create major struggles for organizations that manage freight transactions The sheer volume of transactions exacerbates the challenges of paperwork multiple regulatory and tax environments lack of uniformity in rates and invoice formats and time-consuming approvals emails and phone calls According to a study from by Kuebix Resources1 15 percent of freight bills contain errors Recent research by Drewry Supply Chain Advisors found that the liner shipping industry ldquois exposed to $344 billion in invoice and payment processing inefficiencies based on 126 billion invoices issued in 2017rdquo2 A large-volume shipper told industry observer JOCcom ldquoItrsquos absolutely true that carriers overcharge If you keep the papers moving around enough yoursquoll give up and pay me And therersquos no good way to get that money backrdquo3

Organizations can now take advantage of innovations in technology to automate the process of paying and auditing payments to carriers thereby reducing their administrative burden Industry-leading companies are hiring third-party services or building automated freight audit and pay (FAP) processes in-house to streamline invoice auditing reduce costs of processing invoices and improve financial transparency FAP technology may or may not be a component of a transportation management system (TMS) Yet companies have invested millions in FAP upgrades without achieving an acceptable ROI Why

Even with new FAP technology at their disposal companies have been derailed by traditional problems including inaccurate or outdated contract information such as lane rates accessorials or fuel costs vendor confusion because of inaccurate DBA or other identifiers lack of duplication protection controls and lack of a defined process for managing invoicing discrepancies It turns out success of an FAP upgrade depends on the quality of the implementation

1Kuebix Resources Stop Manually Auditing Your Transportation Freight Bills Transportation News August 17 2018 httpswwwsupplychain247comarticlestop_manually_auditing_your_transportation_freight_bills2Johnson Eric Why container freight invoicing automation hasnrsquot taken off JOCcom September 13 2018 httpswwwjoccomtechnologywhy-container-freight-invoicing-automation-hasnrsquot-taken_20180913html3Ibid

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Taking freight audit and pay solutions to new levelsManual invoicing lack of financial transparency and exceptions continue to create major struggles for organizations that manage freight transactions The sheer volume of transactions exacerbates the challenges of paperwork multiple regulatory and tax environments lack of uniformity in rates and invoice formats and time-consuming approvals emails and phone calls According to a study from by Kuebix Resources1 15 percent of freight bills contain errors Recent research by Drewry Supply Chain Advisors found that the liner shipping industry ldquois exposed to $344 billion in invoice and payment processing inefficiencies based on 126 billion invoices issued in 2017rdquo2 A large-volume shipper told industry observer JOCcom ldquoItrsquos absolutely true that carriers overcharge If you keep the papers moving around enough yoursquoll give up and pay me And therersquos no good way to get that money backrdquo3

Organizations can now take advantage of innovations in technology to automate the process of paying and auditing payments to carriers thereby reducing their administrative burden Industry-leading companies are hiring third-party services or building automated freight audit and pay (FAP) processes in-house to streamline invoice auditing reduce costs of processing invoices and improve financial transparency FAP technology may or may not be a component of a transportation management system (TMS) Yet companies have invested millions in FAP upgrades without achieving an acceptable ROI Why

Even with new FAP technology at their disposal companies have been derailed by traditional problems including inaccurate or outdated contract information such as lane rates accessorials or fuel costs vendor confusion because of inaccurate DBA or other identifiers lack of duplication protection controls and lack of a defined process for managing invoicing discrepancies It turns out success of an FAP upgrade depends on the quality of the implementation

1Kuebix Resources Stop Manually Auditing Your Transportation Freight Bills Transportation News August 17 2018 httpswwwsupplychain247comarticlestop_manually_auditing_your_transportation_freight_bills2Johnson Eric Why container freight invoicing automation hasnrsquot taken off JOCcom September 13 2018 httpswwwjoccomtechnologywhy-container-freight-invoicing-automation-hasnrsquot-taken_20180913html3Ibid

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Automation innovation ndash how technology is changing FAPThe FAP industry which began as an invoice settlement business and was deregulated in the 1980rsquos to allow credit terms between shippers and carriers has developed ten-fold over the past 30 years4 Today a good FAP solution has become as essential as a modern day ERP system When used correctly and in combination with other transformation building blocks it can help enable overall supply chain finance transformation

Embracing intelligent automation now in FAP can deliver insights and inform decision making not only today but into the future The real value in FAP is not the auditing of your invoices but the predictive analytics that provides detailed trends about accessorials data and other unanticipated transportation costs that will help you operate better in the future Todayrsquos FAP solution leverages machine learning and other robotic processes to automate all elements of carrier payables FAP solutions with predictive analytics help you identify and plan for mistakes before they happen and help ensure contract compliance from your vendors Most solutions provide freight auditing and payment for all types of shipments including parcel ocean and air but not all provide reporting and predictive analytics capabilities

With automation and other improvements TMS solutions are now providing pre-auditing services that review the transaction in the order stage These solutions can review transportation orders and calculate transit time fuel costs and other expected accessorials prior to receiving the invoice

The technology wave doesnrsquot stop there The future of supply chain will continue to be impacted by innovations such as robotics process automation (RPA) which is further changing the FAP landscape FAP providers and solutions are now interfacing with companies to automate the entire order-to-cash cycle Many organization are offering solutions that enhance customer service resulting in quicker payments simpler enforcement of payment terms and reduced Days Sales Outstanding (DSO)

According to the American Shipper Transportation Payment Benchmark Survey ldquothe average cost to audit and pay an invoice manually is $463 By utilizing a technology solution or a 3rd party service provider companies realized about 25 percent savings per invoice Many of the cost reductions are attributed to the automated processing and advanced methods to manage large volumes of invoicesrdquo5 If implementation is done incorrectly automation will break down and will have to be replaced with laborious time-consuming and expensive manual processes

4Schulz John D Freight Audit and Payment Take What You Need Logistics Management January 2019 httpsbte-ditionsbyfrycompublicationi=557631issue_id557631page30 5Johnson Eric Transportation Payment Benchmark Study American Shipper 2017 httpa3freightpaymentcoma3freightpaymentblogposts2017-transportation-payment-benchmark-study-publisXTd7ZOhKiUk

2Freight Audit and Pay White Paper 2Freight Audit and Pay White Paper

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Keys to a successful FAP implementationTomorrowrsquos supply chains will have the ability to harness advanced analytics to turn data points into actionable insights and leverage cognitive technologies and robotics automatically to execute actions and support evidence-based human decision-making Organizations cannot overlook the importance of a modern FAP solution and the implementation process is key to ensuring a successful FAP upgrade whether you do it in-house or outsource it Organizations should pay attention to four aspects of the FAP function

Make or buy ndash Determine which path is best for your company Large multinational organizations are using TMS software solutions that offer efficient execution and system-driven freight audit and pay Improved analytics and dashboards contribute to faster more reliable and less costly administrative duties Organizations expanding their global logistics footprint are using third-party logistics companies to streamline the entire FAP process across networks of suppliers to deliver exceptional logistics experiences to customers

Compatibility ndash If you use an outside supplier the supplierrsquos system should be compatible with your organizationrsquos enterprise systems Otherwise vendor names and contracts may be entered incorrectly vendors will be paid incorrectly and invoice audits will become more difficult

Data ndash Maximize the value of your data The data extracted from your FAP process enables you to make better strategic decisions It can also give you accurate data to leverage in negotiations with your carriers

Systems

Contract standardization ndash Contracting standardization enables automation in the FAP process Automation connects contracts with invoicing so seamless invoicing and payments start with the contract itself Assessorial types terms and conditions should be as similar as possible The key difference should be in the rates

Minimize vendor specific considerations ndash This may be harder to do if contracts are already in place For new contracts ensure that all contracts have a standard makeup so that payables andor third party solutions can easily interpret the contract

Contracts

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Post-audits ndash Use post auditors to identify any gaps that may be missed in the freight audit and pay process Using a post auditor ensures accountability by the FAP provider and enables good financial governance for the organization

Sarbanes-Oxley ndash It is very important for public companies that are outsourcing their FAP function to ensure that the provider is SOX compliant and is doing required SOX systems testing and reporting to ensure against money laundering identity theft etc

Compliance

SupplierInternal payable team vendor knowledge ndash The group or party responsible for paying and auditing bills needs to have a good understanding of the business Small misunderstandings such as commodity price differences weight thresholds or other specific details can result in incorrect inputs and disrupt the FAP process

Mandate accuratecompleted invoices for payment ndash ldquoGarbage in garbage outrdquo is a common term in data management and the same holds true for invoice management Policies regarding invoices should be enforced prior to reviewing an invoice For example if an invoice arrives with a line item out of place incomplete or with some other missing item send the information back to the vendor automatically

Consistent POCO and other reference numbers ndash Reference numbers should be standardized and governed Vendors should have a clear understanding of each of the reference numbers to ensure invoices can be easily interpreted

Established windows for invoice changes ndash Nothing is worse than paying a vendor then finding out three months later that your organization has a past due payable on the same bill of lading

Invoice payment thresholds ndash Invoices that are off by less than $10-$30 should be managed accordingly Many companies will pay vendors and cap the payment once the vendor reaches a larger threshold for example $1000 At this point a more thorough analysis would be performed to determine if invoice payments were accurate

Invoicing

4Freight Audit and Pay White Paper 4Freight Audit and Pay White Paper

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Benefits of a successful FAP implementationA successful implementation reduces manual approvals and validation with obvious benefits of reduced costs of managing payments improved data consistency more accurate and timely payables and elimination of duplicate payments

The data bears this out According to a 2013 study by The Hackett Group top performers were able to process supplier invoices approximately 20 percent faster and at 63 percent lower cost than their peers required 80 percent less rework than their peers and were able to process 87 percent more invoices than their peers6

A successful implementation can yield other benefits as well including improving both the payable process and financial management performance

6 AP amp Purchasing Realize Mutual Gains from the Emerging Relationship The Hackett Group 2013

httpswwweskercomsitesdefaultfilescontent035_Esker_White_Paper_AP_OracleEBS-USpdf

Supplier finance

With a healthy FAP solution an organization can partner with a bank to pay invoices directly to transportation vendors This allows the organization to use their access to cash as a vehicle to offer shorter terms to vendors who need faster access to cash For example a transportation company may have an agreement with the organization to deliver a shipment for $1000 under standard 30 to 60 day payment terms In this situation an organization can have the bank pay the transportation company with faster terms (48 hours instead of 30 to 60 days) for a fee or a reduction in the transportation rate (typically 5 ndash 10 of the invoice amount) The organization can then pay the bank at their agreed-upon terms (typically 60 ndash 90 days) and benefit from reduced freight cost fee revenue Many organizations with a large transportation spend are benefitting from their transportation providers when they adopt this option which is a standard practice for transportation factoring companies

CASE STUDY Automating invoice matching and validationAn accounting team at a leading exploration and production company was using a manual process for the intake validation and payment of orders which totaled 3500-4000 per month The process was slow expensive and prone to error and as a result was crippling the teamrsquos FAP process KPMG helped the company create a bot to automate the invoice matching and validation process This process included intake through email followed by a review cycle that occurred within multiple systems depending on the vendor and location of work being performed As a result the company was able to reduce FAP costs and errors and improve its relations with vendors

CASE STUDY Automating goods-receipt and goods-issueA leading global energy provider wanted to automate its goods-receipt and goods-issue process due to excessively high costs delays and errors in its existing process A goods-receipt process provides a means for warehouse staff to systematically create a record of physical receipt of items ordered through a purchase order A goods-issue process provides a means for staff to release items in the warehouse to the field Both of these processes are part of ldquomaterial managementrdquo and help maintain an accurate accounting and inventory of goods flowing into and leaving the warehouse KPMG helped create a procurement bot to automate both of these functions The bot is enabling the company to improve the accuracy of its material management and save thousands of man-hours

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

An improved payable process can help you control and manage your freight spend The payable process is extremely important to transportation carriers because of their need to be paid for their services in a timely manner Unlike typical terms for vendors transportation vendors usually prefer shorter terms due to the transactional nature and cost-intensive elements of their business such as gas trucking loans and payroll Many transportation vendors use factoring companies to manage invoices from slower paying companies in order to receive payment on their services more quickly When trucking companies use these services they may charge more to customers to cover factoring costs By having a good FAP solution organizations can better control how they pay carriers and use that control as leverage during their contract negotiations

Having a good freight audit and pay solution will also help improve financial management performance which can open up organizations to new financial strategies FAP solutions use automation that helps companies keep track of specific expenses by various product lines and business functions This allows those companies to have a better idea of how much money is tied up in carrier vendor payables and obtain insights on how long it takes to pay those carriers Companies are now using this new level of financial accuracy and flexibility to manage terms and conditions with vendors to their advantage Whether itrsquos reducing contractual pricing terms for earlier payment or extending terms for the benefit of maintaining cash flow organizations are presented with more options when they have accurate and tight controls over their financial payables

Next steps Transformation of the FAP function does not happen overnight Organizations need to focus on evaluating the current state of their FAP and determining an execution strategy for moving forward

1 Evaluate FAP people processes and technology against peers

mdash What are your current FAP costs including losses due to rework and unpaid invoices

mdash What are the strengths and weakness of your current technology and processes

mdash What are the strengths and weaknesses of your current FAP staffing

2 Determine an execution strategy

mdash How does FAP transformation align with your overall business goals

mdash What are your technology make-versus-buy options and potential costs and savings

mdash What hiring and training will be required

mdash How can implementation follow best practices and avoid pitfalls regarding systems contracts invoicing and compliance

6Freight Audit and Pay White Paper

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

How KPMG can help KPMGrsquos Supply Chain and Logistics professionals can help your company maximize the efficiency and effectiveness of freight audit and pay processes so you can reduce the administrative burden of paying shipping carriers and increase your transactional visibility Our suite of services address a full range of FAP and other supply chain logistics issues faced by companies across all industries and sectors

Specifically we can help you assess the current state of your FAP systems work with you to create a target operating model based on your business needs evaluate make-versus-buy strategies and implement your selected plan KPMG can help clients with

mdash Carrier payables assessment

mdash FAP target operating model

mdash Make vs buy strategy for managing FAP

mdash TMS implementation

mdash RFP solution assessment

mdash Full scale freight audit and pay implementation

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Contact us

James Johannes

Director Advisory Supply Chain amp Operations

T 404-221-2383

E jjohanneskpmgcom

James is an accomplished Global Transportation and Logistics professional with 20 years of Fortune 500 supply chain experience in a variety of industry verticals and demonstrated skills in process improvement productivity enhancement cost reduction service performance advancement and customer satisfaction directly impacting the bottom line

Yatish Desai

Principal Advisory Supply Chain amp Operations

US leader for Distribution and Logistics

T 216-875-8129

E ydesaikpmgcom

Yatish has more than 20 years of general management experience across a broad range of functions including Operations and Supply Chain Marketing Product Development Engineering and Quality He has consistently been recognized for initiating change process improvements and for the ability to bring organizational discipline and focus to achieve business goals

Perry T Mindo Jr

Senior Associate Advisory Consulting Supply Chain amp Operations

T 973-534-9739

E pmindokpmgcom

Perry Mindo has five years of experience in finance and supply chain consulting He has worked in multiple industry verticals with a focus on operationssupply chain strategy working capital optimization warehousing and demand planning

Justin P Gardner

Manager Advisory Consulting Supply Chain amp Operations

T 404-979-2162

E justingardnerkpmgcom

Justin is a manager in Supply Chain amp Operations and has more than 10 years of experience working for multiple Fortune 500 companies in multiple industry verticals with a consulting focus on operational transformations logistics and distribution strategy and pre- and post-merger organization realignment

For more information on how KPMG can help you transform your freight audit and pay and other supply chain and logistics processes contact us directly or visit us at readkpmgussupplychain

8Freight Audit and Pay White PaperFreight Audit and Pay White Paper

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

kpmgcomsocialmedia

Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity Although we endeavor to provide accurate and timely information there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Post-audits ndash Use post auditors to identify any gaps that may be missed in the freight audit and pay process Using a post auditor ensures accountability by the FAP provider and enables good financial governance for the organization

Sarbanes-Oxley ndash It is very important for public companies that are outsourcing their FAP function to ensure that the provider is SOX compliant and is doing required SOX systems testing and reporting to ensure against money laundering identity theft etc

Compliance

SupplierInternal payable team vendor knowledge ndash The group or party responsible for paying and auditing bills needs to have a good understanding of the business Small misunderstandings such as commodity price differences weight thresholds or other specific details can result in incorrect inputs and disrupt the FAP process

Mandate accuratecompleted invoices for payment ndash ldquoGarbage in garbage outrdquo is a common term in data management and the same holds true for invoice management Policies regarding invoices should be enforced prior to reviewing an invoice For example if an invoice arrives with a line item out of place incomplete or with some other missing item send the information back to the vendor automatically

Consistent POCO and other reference numbers ndash Reference numbers should be standardized and governed Vendors should have a clear understanding of each of the reference numbers to ensure invoices can be easily interpreted

Established windows for invoice changes ndash Nothing is worse than paying a vendor then finding out three months later that your organization has a past due payable on the same bill of lading

Invoice payment thresholds ndash Invoices that are off by less than $10-$30 should be managed accordingly Many companies will pay vendors and cap the payment once the vendor reaches a larger threshold for example $1000 At this point a more thorough analysis would be performed to determine if invoice payments were accurate

Invoicing

4Freight Audit and Pay White Paper 4Freight Audit and Pay White Paper

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Benefits of a successful FAP implementationA successful implementation reduces manual approvals and validation with obvious benefits of reduced costs of managing payments improved data consistency more accurate and timely payables and elimination of duplicate payments

The data bears this out According to a 2013 study by The Hackett Group top performers were able to process supplier invoices approximately 20 percent faster and at 63 percent lower cost than their peers required 80 percent less rework than their peers and were able to process 87 percent more invoices than their peers6

A successful implementation can yield other benefits as well including improving both the payable process and financial management performance

6 AP amp Purchasing Realize Mutual Gains from the Emerging Relationship The Hackett Group 2013

httpswwweskercomsitesdefaultfilescontent035_Esker_White_Paper_AP_OracleEBS-USpdf

Supplier finance

With a healthy FAP solution an organization can partner with a bank to pay invoices directly to transportation vendors This allows the organization to use their access to cash as a vehicle to offer shorter terms to vendors who need faster access to cash For example a transportation company may have an agreement with the organization to deliver a shipment for $1000 under standard 30 to 60 day payment terms In this situation an organization can have the bank pay the transportation company with faster terms (48 hours instead of 30 to 60 days) for a fee or a reduction in the transportation rate (typically 5 ndash 10 of the invoice amount) The organization can then pay the bank at their agreed-upon terms (typically 60 ndash 90 days) and benefit from reduced freight cost fee revenue Many organizations with a large transportation spend are benefitting from their transportation providers when they adopt this option which is a standard practice for transportation factoring companies

CASE STUDY Automating invoice matching and validationAn accounting team at a leading exploration and production company was using a manual process for the intake validation and payment of orders which totaled 3500-4000 per month The process was slow expensive and prone to error and as a result was crippling the teamrsquos FAP process KPMG helped the company create a bot to automate the invoice matching and validation process This process included intake through email followed by a review cycle that occurred within multiple systems depending on the vendor and location of work being performed As a result the company was able to reduce FAP costs and errors and improve its relations with vendors

CASE STUDY Automating goods-receipt and goods-issueA leading global energy provider wanted to automate its goods-receipt and goods-issue process due to excessively high costs delays and errors in its existing process A goods-receipt process provides a means for warehouse staff to systematically create a record of physical receipt of items ordered through a purchase order A goods-issue process provides a means for staff to release items in the warehouse to the field Both of these processes are part of ldquomaterial managementrdquo and help maintain an accurate accounting and inventory of goods flowing into and leaving the warehouse KPMG helped create a procurement bot to automate both of these functions The bot is enabling the company to improve the accuracy of its material management and save thousands of man-hours

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

An improved payable process can help you control and manage your freight spend The payable process is extremely important to transportation carriers because of their need to be paid for their services in a timely manner Unlike typical terms for vendors transportation vendors usually prefer shorter terms due to the transactional nature and cost-intensive elements of their business such as gas trucking loans and payroll Many transportation vendors use factoring companies to manage invoices from slower paying companies in order to receive payment on their services more quickly When trucking companies use these services they may charge more to customers to cover factoring costs By having a good FAP solution organizations can better control how they pay carriers and use that control as leverage during their contract negotiations

Having a good freight audit and pay solution will also help improve financial management performance which can open up organizations to new financial strategies FAP solutions use automation that helps companies keep track of specific expenses by various product lines and business functions This allows those companies to have a better idea of how much money is tied up in carrier vendor payables and obtain insights on how long it takes to pay those carriers Companies are now using this new level of financial accuracy and flexibility to manage terms and conditions with vendors to their advantage Whether itrsquos reducing contractual pricing terms for earlier payment or extending terms for the benefit of maintaining cash flow organizations are presented with more options when they have accurate and tight controls over their financial payables

Next steps Transformation of the FAP function does not happen overnight Organizations need to focus on evaluating the current state of their FAP and determining an execution strategy for moving forward

1 Evaluate FAP people processes and technology against peers

mdash What are your current FAP costs including losses due to rework and unpaid invoices

mdash What are the strengths and weakness of your current technology and processes

mdash What are the strengths and weaknesses of your current FAP staffing

2 Determine an execution strategy

mdash How does FAP transformation align with your overall business goals

mdash What are your technology make-versus-buy options and potential costs and savings

mdash What hiring and training will be required

mdash How can implementation follow best practices and avoid pitfalls regarding systems contracts invoicing and compliance

6Freight Audit and Pay White Paper

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

How KPMG can help KPMGrsquos Supply Chain and Logistics professionals can help your company maximize the efficiency and effectiveness of freight audit and pay processes so you can reduce the administrative burden of paying shipping carriers and increase your transactional visibility Our suite of services address a full range of FAP and other supply chain logistics issues faced by companies across all industries and sectors

Specifically we can help you assess the current state of your FAP systems work with you to create a target operating model based on your business needs evaluate make-versus-buy strategies and implement your selected plan KPMG can help clients with

mdash Carrier payables assessment

mdash FAP target operating model

mdash Make vs buy strategy for managing FAP

mdash TMS implementation

mdash RFP solution assessment

mdash Full scale freight audit and pay implementation

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Contact us

James Johannes

Director Advisory Supply Chain amp Operations

T 404-221-2383

E jjohanneskpmgcom

James is an accomplished Global Transportation and Logistics professional with 20 years of Fortune 500 supply chain experience in a variety of industry verticals and demonstrated skills in process improvement productivity enhancement cost reduction service performance advancement and customer satisfaction directly impacting the bottom line

Yatish Desai

Principal Advisory Supply Chain amp Operations

US leader for Distribution and Logistics

T 216-875-8129

E ydesaikpmgcom

Yatish has more than 20 years of general management experience across a broad range of functions including Operations and Supply Chain Marketing Product Development Engineering and Quality He has consistently been recognized for initiating change process improvements and for the ability to bring organizational discipline and focus to achieve business goals

Perry T Mindo Jr

Senior Associate Advisory Consulting Supply Chain amp Operations

T 973-534-9739

E pmindokpmgcom

Perry Mindo has five years of experience in finance and supply chain consulting He has worked in multiple industry verticals with a focus on operationssupply chain strategy working capital optimization warehousing and demand planning

Justin P Gardner

Manager Advisory Consulting Supply Chain amp Operations

T 404-979-2162

E justingardnerkpmgcom

Justin is a manager in Supply Chain amp Operations and has more than 10 years of experience working for multiple Fortune 500 companies in multiple industry verticals with a consulting focus on operational transformations logistics and distribution strategy and pre- and post-merger organization realignment

For more information on how KPMG can help you transform your freight audit and pay and other supply chain and logistics processes contact us directly or visit us at readkpmgussupplychain

8Freight Audit and Pay White PaperFreight Audit and Pay White Paper

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

kpmgcomsocialmedia

Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity Although we endeavor to provide accurate and timely information there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Benefits of a successful FAP implementationA successful implementation reduces manual approvals and validation with obvious benefits of reduced costs of managing payments improved data consistency more accurate and timely payables and elimination of duplicate payments

The data bears this out According to a 2013 study by The Hackett Group top performers were able to process supplier invoices approximately 20 percent faster and at 63 percent lower cost than their peers required 80 percent less rework than their peers and were able to process 87 percent more invoices than their peers6

A successful implementation can yield other benefits as well including improving both the payable process and financial management performance

6 AP amp Purchasing Realize Mutual Gains from the Emerging Relationship The Hackett Group 2013

httpswwweskercomsitesdefaultfilescontent035_Esker_White_Paper_AP_OracleEBS-USpdf

Supplier finance

With a healthy FAP solution an organization can partner with a bank to pay invoices directly to transportation vendors This allows the organization to use their access to cash as a vehicle to offer shorter terms to vendors who need faster access to cash For example a transportation company may have an agreement with the organization to deliver a shipment for $1000 under standard 30 to 60 day payment terms In this situation an organization can have the bank pay the transportation company with faster terms (48 hours instead of 30 to 60 days) for a fee or a reduction in the transportation rate (typically 5 ndash 10 of the invoice amount) The organization can then pay the bank at their agreed-upon terms (typically 60 ndash 90 days) and benefit from reduced freight cost fee revenue Many organizations with a large transportation spend are benefitting from their transportation providers when they adopt this option which is a standard practice for transportation factoring companies

CASE STUDY Automating invoice matching and validationAn accounting team at a leading exploration and production company was using a manual process for the intake validation and payment of orders which totaled 3500-4000 per month The process was slow expensive and prone to error and as a result was crippling the teamrsquos FAP process KPMG helped the company create a bot to automate the invoice matching and validation process This process included intake through email followed by a review cycle that occurred within multiple systems depending on the vendor and location of work being performed As a result the company was able to reduce FAP costs and errors and improve its relations with vendors

CASE STUDY Automating goods-receipt and goods-issueA leading global energy provider wanted to automate its goods-receipt and goods-issue process due to excessively high costs delays and errors in its existing process A goods-receipt process provides a means for warehouse staff to systematically create a record of physical receipt of items ordered through a purchase order A goods-issue process provides a means for staff to release items in the warehouse to the field Both of these processes are part of ldquomaterial managementrdquo and help maintain an accurate accounting and inventory of goods flowing into and leaving the warehouse KPMG helped create a procurement bot to automate both of these functions The bot is enabling the company to improve the accuracy of its material management and save thousands of man-hours

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

An improved payable process can help you control and manage your freight spend The payable process is extremely important to transportation carriers because of their need to be paid for their services in a timely manner Unlike typical terms for vendors transportation vendors usually prefer shorter terms due to the transactional nature and cost-intensive elements of their business such as gas trucking loans and payroll Many transportation vendors use factoring companies to manage invoices from slower paying companies in order to receive payment on their services more quickly When trucking companies use these services they may charge more to customers to cover factoring costs By having a good FAP solution organizations can better control how they pay carriers and use that control as leverage during their contract negotiations

Having a good freight audit and pay solution will also help improve financial management performance which can open up organizations to new financial strategies FAP solutions use automation that helps companies keep track of specific expenses by various product lines and business functions This allows those companies to have a better idea of how much money is tied up in carrier vendor payables and obtain insights on how long it takes to pay those carriers Companies are now using this new level of financial accuracy and flexibility to manage terms and conditions with vendors to their advantage Whether itrsquos reducing contractual pricing terms for earlier payment or extending terms for the benefit of maintaining cash flow organizations are presented with more options when they have accurate and tight controls over their financial payables

Next steps Transformation of the FAP function does not happen overnight Organizations need to focus on evaluating the current state of their FAP and determining an execution strategy for moving forward

1 Evaluate FAP people processes and technology against peers

mdash What are your current FAP costs including losses due to rework and unpaid invoices

mdash What are the strengths and weakness of your current technology and processes

mdash What are the strengths and weaknesses of your current FAP staffing

2 Determine an execution strategy

mdash How does FAP transformation align with your overall business goals

mdash What are your technology make-versus-buy options and potential costs and savings

mdash What hiring and training will be required

mdash How can implementation follow best practices and avoid pitfalls regarding systems contracts invoicing and compliance

6Freight Audit and Pay White Paper

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

How KPMG can help KPMGrsquos Supply Chain and Logistics professionals can help your company maximize the efficiency and effectiveness of freight audit and pay processes so you can reduce the administrative burden of paying shipping carriers and increase your transactional visibility Our suite of services address a full range of FAP and other supply chain logistics issues faced by companies across all industries and sectors

Specifically we can help you assess the current state of your FAP systems work with you to create a target operating model based on your business needs evaluate make-versus-buy strategies and implement your selected plan KPMG can help clients with

mdash Carrier payables assessment

mdash FAP target operating model

mdash Make vs buy strategy for managing FAP

mdash TMS implementation

mdash RFP solution assessment

mdash Full scale freight audit and pay implementation

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Contact us

James Johannes

Director Advisory Supply Chain amp Operations

T 404-221-2383

E jjohanneskpmgcom

James is an accomplished Global Transportation and Logistics professional with 20 years of Fortune 500 supply chain experience in a variety of industry verticals and demonstrated skills in process improvement productivity enhancement cost reduction service performance advancement and customer satisfaction directly impacting the bottom line

Yatish Desai

Principal Advisory Supply Chain amp Operations

US leader for Distribution and Logistics

T 216-875-8129

E ydesaikpmgcom

Yatish has more than 20 years of general management experience across a broad range of functions including Operations and Supply Chain Marketing Product Development Engineering and Quality He has consistently been recognized for initiating change process improvements and for the ability to bring organizational discipline and focus to achieve business goals

Perry T Mindo Jr

Senior Associate Advisory Consulting Supply Chain amp Operations

T 973-534-9739

E pmindokpmgcom

Perry Mindo has five years of experience in finance and supply chain consulting He has worked in multiple industry verticals with a focus on operationssupply chain strategy working capital optimization warehousing and demand planning

Justin P Gardner

Manager Advisory Consulting Supply Chain amp Operations

T 404-979-2162

E justingardnerkpmgcom

Justin is a manager in Supply Chain amp Operations and has more than 10 years of experience working for multiple Fortune 500 companies in multiple industry verticals with a consulting focus on operational transformations logistics and distribution strategy and pre- and post-merger organization realignment

For more information on how KPMG can help you transform your freight audit and pay and other supply chain and logistics processes contact us directly or visit us at readkpmgussupplychain

8Freight Audit and Pay White PaperFreight Audit and Pay White Paper

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

kpmgcomsocialmedia

Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity Although we endeavor to provide accurate and timely information there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

An improved payable process can help you control and manage your freight spend The payable process is extremely important to transportation carriers because of their need to be paid for their services in a timely manner Unlike typical terms for vendors transportation vendors usually prefer shorter terms due to the transactional nature and cost-intensive elements of their business such as gas trucking loans and payroll Many transportation vendors use factoring companies to manage invoices from slower paying companies in order to receive payment on their services more quickly When trucking companies use these services they may charge more to customers to cover factoring costs By having a good FAP solution organizations can better control how they pay carriers and use that control as leverage during their contract negotiations

Having a good freight audit and pay solution will also help improve financial management performance which can open up organizations to new financial strategies FAP solutions use automation that helps companies keep track of specific expenses by various product lines and business functions This allows those companies to have a better idea of how much money is tied up in carrier vendor payables and obtain insights on how long it takes to pay those carriers Companies are now using this new level of financial accuracy and flexibility to manage terms and conditions with vendors to their advantage Whether itrsquos reducing contractual pricing terms for earlier payment or extending terms for the benefit of maintaining cash flow organizations are presented with more options when they have accurate and tight controls over their financial payables

Next steps Transformation of the FAP function does not happen overnight Organizations need to focus on evaluating the current state of their FAP and determining an execution strategy for moving forward

1 Evaluate FAP people processes and technology against peers

mdash What are your current FAP costs including losses due to rework and unpaid invoices

mdash What are the strengths and weakness of your current technology and processes

mdash What are the strengths and weaknesses of your current FAP staffing

2 Determine an execution strategy

mdash How does FAP transformation align with your overall business goals

mdash What are your technology make-versus-buy options and potential costs and savings

mdash What hiring and training will be required

mdash How can implementation follow best practices and avoid pitfalls regarding systems contracts invoicing and compliance

6Freight Audit and Pay White Paper

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

How KPMG can help KPMGrsquos Supply Chain and Logistics professionals can help your company maximize the efficiency and effectiveness of freight audit and pay processes so you can reduce the administrative burden of paying shipping carriers and increase your transactional visibility Our suite of services address a full range of FAP and other supply chain logistics issues faced by companies across all industries and sectors

Specifically we can help you assess the current state of your FAP systems work with you to create a target operating model based on your business needs evaluate make-versus-buy strategies and implement your selected plan KPMG can help clients with

mdash Carrier payables assessment

mdash FAP target operating model

mdash Make vs buy strategy for managing FAP

mdash TMS implementation

mdash RFP solution assessment

mdash Full scale freight audit and pay implementation

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Contact us

James Johannes

Director Advisory Supply Chain amp Operations

T 404-221-2383

E jjohanneskpmgcom

James is an accomplished Global Transportation and Logistics professional with 20 years of Fortune 500 supply chain experience in a variety of industry verticals and demonstrated skills in process improvement productivity enhancement cost reduction service performance advancement and customer satisfaction directly impacting the bottom line

Yatish Desai

Principal Advisory Supply Chain amp Operations

US leader for Distribution and Logistics

T 216-875-8129

E ydesaikpmgcom

Yatish has more than 20 years of general management experience across a broad range of functions including Operations and Supply Chain Marketing Product Development Engineering and Quality He has consistently been recognized for initiating change process improvements and for the ability to bring organizational discipline and focus to achieve business goals

Perry T Mindo Jr

Senior Associate Advisory Consulting Supply Chain amp Operations

T 973-534-9739

E pmindokpmgcom

Perry Mindo has five years of experience in finance and supply chain consulting He has worked in multiple industry verticals with a focus on operationssupply chain strategy working capital optimization warehousing and demand planning

Justin P Gardner

Manager Advisory Consulting Supply Chain amp Operations

T 404-979-2162

E justingardnerkpmgcom

Justin is a manager in Supply Chain amp Operations and has more than 10 years of experience working for multiple Fortune 500 companies in multiple industry verticals with a consulting focus on operational transformations logistics and distribution strategy and pre- and post-merger organization realignment

For more information on how KPMG can help you transform your freight audit and pay and other supply chain and logistics processes contact us directly or visit us at readkpmgussupplychain

8Freight Audit and Pay White PaperFreight Audit and Pay White Paper

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

kpmgcomsocialmedia

Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity Although we endeavor to provide accurate and timely information there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

How KPMG can help KPMGrsquos Supply Chain and Logistics professionals can help your company maximize the efficiency and effectiveness of freight audit and pay processes so you can reduce the administrative burden of paying shipping carriers and increase your transactional visibility Our suite of services address a full range of FAP and other supply chain logistics issues faced by companies across all industries and sectors

Specifically we can help you assess the current state of your FAP systems work with you to create a target operating model based on your business needs evaluate make-versus-buy strategies and implement your selected plan KPMG can help clients with

mdash Carrier payables assessment

mdash FAP target operating model

mdash Make vs buy strategy for managing FAP

mdash TMS implementation

mdash RFP solution assessment

mdash Full scale freight audit and pay implementation

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Contact us

James Johannes

Director Advisory Supply Chain amp Operations

T 404-221-2383

E jjohanneskpmgcom

James is an accomplished Global Transportation and Logistics professional with 20 years of Fortune 500 supply chain experience in a variety of industry verticals and demonstrated skills in process improvement productivity enhancement cost reduction service performance advancement and customer satisfaction directly impacting the bottom line

Yatish Desai

Principal Advisory Supply Chain amp Operations

US leader for Distribution and Logistics

T 216-875-8129

E ydesaikpmgcom

Yatish has more than 20 years of general management experience across a broad range of functions including Operations and Supply Chain Marketing Product Development Engineering and Quality He has consistently been recognized for initiating change process improvements and for the ability to bring organizational discipline and focus to achieve business goals

Perry T Mindo Jr

Senior Associate Advisory Consulting Supply Chain amp Operations

T 973-534-9739

E pmindokpmgcom

Perry Mindo has five years of experience in finance and supply chain consulting He has worked in multiple industry verticals with a focus on operationssupply chain strategy working capital optimization warehousing and demand planning

Justin P Gardner

Manager Advisory Consulting Supply Chain amp Operations

T 404-979-2162

E justingardnerkpmgcom

Justin is a manager in Supply Chain amp Operations and has more than 10 years of experience working for multiple Fortune 500 companies in multiple industry verticals with a consulting focus on operational transformations logistics and distribution strategy and pre- and post-merger organization realignment

For more information on how KPMG can help you transform your freight audit and pay and other supply chain and logistics processes contact us directly or visit us at readkpmgussupplychain

8Freight Audit and Pay White PaperFreight Audit and Pay White Paper

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

kpmgcomsocialmedia

Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity Although we endeavor to provide accurate and timely information there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

Contact us

James Johannes

Director Advisory Supply Chain amp Operations

T 404-221-2383

E jjohanneskpmgcom

James is an accomplished Global Transportation and Logistics professional with 20 years of Fortune 500 supply chain experience in a variety of industry verticals and demonstrated skills in process improvement productivity enhancement cost reduction service performance advancement and customer satisfaction directly impacting the bottom line

Yatish Desai

Principal Advisory Supply Chain amp Operations

US leader for Distribution and Logistics

T 216-875-8129

E ydesaikpmgcom

Yatish has more than 20 years of general management experience across a broad range of functions including Operations and Supply Chain Marketing Product Development Engineering and Quality He has consistently been recognized for initiating change process improvements and for the ability to bring organizational discipline and focus to achieve business goals

Perry T Mindo Jr

Senior Associate Advisory Consulting Supply Chain amp Operations

T 973-534-9739

E pmindokpmgcom

Perry Mindo has five years of experience in finance and supply chain consulting He has worked in multiple industry verticals with a focus on operationssupply chain strategy working capital optimization warehousing and demand planning

Justin P Gardner

Manager Advisory Consulting Supply Chain amp Operations

T 404-979-2162

E justingardnerkpmgcom

Justin is a manager in Supply Chain amp Operations and has more than 10 years of experience working for multiple Fortune 500 companies in multiple industry verticals with a consulting focus on operational transformations logistics and distribution strategy and pre- and post-merger organization realignment

For more information on how KPMG can help you transform your freight audit and pay and other supply chain and logistics processes contact us directly or visit us at readkpmgussupplychain

8Freight Audit and Pay White PaperFreight Audit and Pay White Paper

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

kpmgcomsocialmedia

Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity Although we endeavor to provide accurate and timely information there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

copy 2019 KPMG LLP a Delaware limited liability partnership and the US member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (ldquoKPMG Internationalrdquo) a Swiss entity All rights reserved The KPMG name and logo are registered trademarks or trademarks of KPMG International NDP034594A-1

kpmgcomsocialmedia

Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities

The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity Although we endeavor to provide accurate and timely information there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation