Enhancing Cash Flow for Logistics Companies: Four Strategies for Freight Invoice Optimization

Cash flow is essential for trucking companies to keep the wheels moving. Cash flow is also essential for freight brokerages to get those carriers paid. Optimizing freight invoices with back-office software can speed up the flow of cash — and ensure every invoice is accurate and remittances are applied appropriately.

Delays and inaccuracies in freight invoices create significant blocks to cash flow. Today, there are tools to prevent cash flow blockages, including the implementation of automated invoices and payments. Upwell stands at the forefront of freight finance, empowering carriers and brokers with the latest tech tools to streamline their invoicing operations and maximize cash flow.

Significant Challenges Stand Between Brokers and Effective Trucking Invoicing

Trucking “is a capital-intense industry with excessive daily operating expenses,” according to eCapital. “Maintaining regular cash flow is essential to paying bills, driver salaries, over-the-road expenses, and the multitude of unexpected costs that always seem to appear. When the stream of cash is insufficient to meet the outgoing cash needs of your business, daily operations get bogged down, suppliers become less responsive, and budgeting becomes unpredictable.”

Manual freight invoice processing creates bottlenecks for brokers and carriers alike. Invoicing inaccuracies and delayed payments can result in serious cash flow problems for both parties.

In the cutthroat logistics industry, keeping the lights on can come down to how much cash is coming in. Payments to carriers may not be the top priority.

Freight Caviar said that “challenging market conditions … can lead to a shortfall in the broker’s ability to pay carriers, undermining the trust and efficiency in the supply chain.”

The bankruptcy of freight brokerage Surge Transportation was used as an example. “Despite boasting gross revenues of around $150 million in 2022, the post-COVID-19 market downturn hit them hard. When they filed for Chapter 11 bankruptcy in July 2023, they owed about $12 million to 5,000 trucking companies,” Freight Caviar said.

Upwell co-founder and CEO Charley Dehoney brought up the 2023 bankruptcy of digital brokerage Convoy on “The Logistics of Logistics” podcast. “Really, when you get down to the root cause of [Convoy’s demise], it was a working capital issue. Their lenders could no longer provide the levels of liquidity that were required to run that business.”

Efficiency gains obtained from the automation of freight invoicing and remittance — and the ability to get cash in the door faster — can be a means of survival for trucking companies and freight brokers, particularly in a volatile economy.

“From increased productivity to simplifying your administrative tasks, efficiency on all levels of business is vital to reducing waste and maximizing returns,” eCapital said.

Innovative Solutions for Efficient Freight Invoice Processing

Upwell is an invoicing and accounts receivable automation platform designed specifically for logistics and trucking. We help freight brokers and carriers get paid faster by automating the tedious tasks that bog down their back offices. From pre-auditing invoices to ensure accuracy to streamlining payment collections, our freight invoice software improves cash flow while reducing overhead.

Upwell’s innovative solutions are revolutionizing freight invoice processing, enhancing efficiency and accuracy — and improving cash flow for brokers and carriers. Our automation platform streamlines data entry, validates invoices, and integrates seamlessly with existing systems. Electronic documentation and flexible payment options further expedite processing, reducing errors and delays for trucking companies and freight brokerages.

Four Strategies for Trucking Invoice Optimization

Team up with Upwell to optimize trucking invoicing by implementing automated invoicing systems, leveraging electronic documentation, offering flexible payment options, and streamlining accounts receivable processes.

Implementing Automated Invoicing Systems

Automated invoicing systems reduce errors, accelerate processing times, and improve cash flow visibility.

“Any business interested in growth needs to automate,” a Forbes article said. “In today’s connected world, digital workflows and machine learning are streamlining business and transactional processes, making them more efficient and taking humans out of the equation so they can focus on more productive tasks. We have automated sales, supply chain, factory assembly lines, and even delivery. However, many companies have been lax in automating financial processes such as billing. Without automated billing, you often cannot optimize sustained business growth.”  

At Upwell, we use AI to quickly resolve freight invoice exceptions that prevent supply chain parties from getting paid. Our Smart Invoices automate the extraction of invoice details and documents, reducing manual data entry errors. We keep track of each customer’s requirements to pay and autonomously send invoices.

Our Distribution Automation feature expertly handles freight invoices, ensuring each payment request reaches its destination exactly as each customer requires, whether via EDI, API, email, or directly into online portals.

Our Last Check leverages large language models to pre-audit freight invoices against customer-specific rules, ensuring each one is accurate and complete. This eliminates errors, ensures faster payments, and drastically reduces the time spent on manual checks.

Leveraging Electronic Documentation

Electronic documentation for bills of lading and proof of delivery speeds up freight invoice processing and reduces administrative overhead.

“Embracing digital solutions can offer a multitude of benefits to freight brokers. Enhanced efficiency, minimized mistakes, and reinforced compliance with customs authorities are just a few advantages of utilizing digital solutions for freight documentation. These solutions not only save time and effort but also reduce the likelihood of costly errors and ensure seamless shipping processes,” Freight Broker Schools said.

At Upwell, our Real-Time Integrations provide seamless connectivity with a host of TMS, ERP, and accounting platforms. We act as the middleware, and as a result, customers can go from logging into more than a dozen different systems to simply using Upwell.

Offering Flexible Payment Options

Flexible payment options improve customer satisfaction and accelerate payment collection. At Upwell, our flexible payment options include prepayment and single and multiple freight invoices.

Our Integrated Payments platform allows customers to make immediate, secure transactions with multiple payment options. The Online Payment Portal & Options feature offers a variety of payment methods through a secure, easy-to-use portal. This not only accelerates cash flow but elevates the customer experience.

Our Cash Application/Remittance Processing feature ensures that payments swiftly find their matching invoices, turning what was once a painstaking process into a seamless, secure, and error-free operation.

An article titled “Top 10 Proven Tips for Automating Your Cash Application Process” pointed out that manual cash application is “time-consuming, error-prone, and can result in delayed or inaccurate posting of payments. This can create a domino effect on other business processes, leading to delayed payments to vendors, inaccurate financial reporting, and strained relationships with customers.

“Automating the cash application process can help organizations streamline their accounts receivable operations and improve cash flow management. By leveraging technology to automate cash application, businesses can reduce errors, improve efficiency, and gain real-time visibility into their cash inflows. This can help finance leaders make better-informed decisions, improve forecasting accuracy, and drive business growth.”

Streamlining Accounts Receivable Processes

Accounts receivable processes can be streamlined with payment reminders and proactive follow-ups. Clear communication results in efficient collections management.

An article on the benefits of automated invoice reminders said, “Calling customers to collect past-due balances is a tedious and largely unnecessary process that most customers do not appreciate. It requires enormous resources and effort from organizations and doesn’t always yield the expected results. Automated payment reminders feel more respectful to the customer’s space and boundaries, and often feel friendlier than cold calls.”

It said that digital payment reminders reach customers through their preferred communication channel, facilitate online payments, and “reduce friction in the payment process.”

At Upwell, our Automated Statements & Payment Reminders allow companies to set up automated, customizable communication sequences that nudge customers toward fulfilling their payment obligations in language designed to match customers’ brand voice and context.

Upwell: The Frontier of Freight Finance

Upwell has revolutionized freight invoicing by automating repetitive back-office tasks and eliminating human error. Our automated invoice-to-income platform aligns with the unique invoicing requirements of freight brokerages and trucking companies.

Upwell is helping freight brokers, asset-based trucking companies, and logistics companies streamline their back offices and enhance cash flow by getting paid faster. By automating back-office processes with Upwell, our customers are seeing a 50% operational expense reduction per employee, a four-day decrease in daily sales outstanding (DSO), and a 10% increase in cash flow.

“With all the complexities around sending out an accurate, thorough, and complete invoice, it leads to a lot of time lapses, and ultimately we’re helping transportation and logistics companies reduce their daily sales outstanding,” Upwell CEO Dehoney said on “The Logistics of Logistics” podcast. “Daily sales outstanding is the No. 1 metric that all these companies should be tracking, and the best CFOs and CEOs in the industry do track that KPI as the most important KPI.

“Daily sales outstanding is actually from the time the order is closed out, or the product is delivered, until the time you get paid for that service. That number of days is what represents daily sales outstanding, and if that number is significantly higher than your daily payables outstanding, then that delta between payables and receivables represents your negative cash flow, and that’s the amount of money that puts companies in trouble.”

Get an Upwell demo today and set your business on a path to get paid faster.

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