Published on August 5th, 2026
Most people advise you to negotiate better rates. It’s not terrible guidance. But you shouldn’t look forward before looking back.
Before you rewrite a single carrier contract, you should know whether you’re paying the right amount on the invoices right now. Most companies don’t know. And that’s the gap that a supply chain audit fills.
Pull A Complete Invoice Dataset First
DO NOT audit on a sample. Extract every freight invoice from the last half to a full year and consolidate it before you undertake step two.
Picking a random handful of invoices is just that – guessing. You’ll come across an error here and there, feel good about catching them, and miss out on the widespread mistakes that are likely costing you money.
What you want to see in this consolidated, unedited data dump: how much you’re spending with each carrier, on each lane, with each mode, and at each service level.
You can’t evaluate anything until you track everything. A transportation management system will do this automatically by serving as a data warehouse, but even a well-managed spreadsheet will suffice.
Reconcile Invoices Against Your Contract Rates
You can achieve the fastest financial win through this audit. Compare each carrier invoice with the negotiated rate card for that lane.
Industry freight audit data reveals that approximately 5-10% of carrier invoices have billing errors, and you can retrieve the overcharges by reconciling them regularly to get back an average of 2-5% of total freight spend.
This is not a rounding mistake. On a $2 million yearly freight budget, 2-5% equals $40,000 to $100,000 that you have because of billing inconsistencies.
Errors are not always on purpose; carriers handle millions of invoices and sometimes, rate updates are not implemented as expected, but if you don’t note them, they are your responsibility in any case.
Check all the details.
Build It In-house Or Hand It Off
Once you work through all of the considerations above, the question becomes whether your internal team can manage all of this effectively itself.
For companies with lean teams and growing freight complexity, ongoing invoice auditing and carrier management can outpace internal capacity quickly.
That’s the point at which 3PL logistics services start paying for themselves – a 3PL can run continuous freight audits, manage carrier relationships across modes, and provide the scalable infrastructure that a small internal team can’t maintain alongside everything else they’re responsible for.
Don’t skip the reverse logistics piece here either. Returns are a cost center that most audits ignore entirely, but the same invoice errors, accessorial mischarges, and mode mismatches that affect outbound shipping exist on the returns side too.
Dig Into Accessorial Charges
Extra charges are usually the most alarming in the list. Including fuel surcharges, residential delivery costs, location correction fees, lift gate expenses, detention charges.
These charges are generally ignored since they look trivial on their own and are incredibly complicated for different carriers.
The problem is that they all add up, and a lot of times they are miscalculated. For instance, fuel surcharges are indexed charges that are associated with weekly diesel costs.
If a carrier system uses the wrong week or inaccurate percentage rate, you overpay for every shipment inside the carrier period.
Create an extra charge spend category. If extra costs exceed 20-25% of the total freight charges you pay, start researching.
If you frequently ship to residential locations, reconsider whether the destination actually warranted the residential fee for each shipment.
Check Dimensional Weight And Packaging
DIM weight pricing is when shipping carriers charge based on the package’s volume rather than simply the weight of the package if the volume-based calculation is higher. So if your packaging isn’t efficient, you’re essentially shipping air.
Review your top SKUs by shipment volume. For each one, compare the actual dimensions of the box you are currently using to ship that product, and the dimensions of the product that is being shipped.
Many companies are using oversized boxes out of convenience, either because that’s the size of box they’ve always used or because they are overcompensating on protective padding.
This is a relatively simple fix; right-size the packaging for your most frequently shipped products, and re-run that calculation for what DIM weight billing would equate to. It’s often enough to cover the costs of redesigning and sourcing alternative packaging.
Score Carriers And Reassess Mode Selection
After you have obtained clean data, evaluate each carrier based on two factors: cost per lane and OTIF (on-time, in-full performance).
Cost is important, however, OTIF is just as important, because a low-cost carrier that delivers late or with a shortage incurs additional downstream costs that are not indicated on the freight invoice.
Consider whether each shipment is being transported via the correct mode. Parcel, LTL, and FTL all have levels of volume where they become economical, and misclassified freight silently reduces your profits.
Consolidating LTL shipments into fuller loads through freight pooling can reduce per-unit cost on lanes where you have enough volume.
Zone skipping – routing consolidated parcels to a regional hub before final delivery – cuts expensive long-distance zone charges when it’s applicable to your network.
Once you have performance scored all your carriers per lane, and identified your “A” carriers, consolidate volume with them. The more volume you can shift to your best carriers the more leverage you have in the next bidding cycle.
The Audit Is Repeatable
Schedule this audit process to run on a quarterly basis or at minimum twice a year.
Billing errors will creep back in, rate cards will be updated, and packaging decisions will drift over time.
A supply chain audit isn’t a one-time cleanup – it’s a control mechanism. Build the process, document what you find, and run it again before the savings disappear back into the noise.
