Bean counters be gone
As bits and bytes cut cost in shipping, a new Drewry white paper asks: is anyone looking at the payment processes?
Drewry estimates that in 2017, the global containerised trade of 207 million teu of ocean containers required around 1.26 billion freight invoices to be issued, verified, paid and reconciled. With the current low levels of automation of payment processes among shippers, forwarders and shipping, we estimate a total process cost of $34.4 billion annually.
In a new white paper (‘Invoicing and payment processes in global container shipping: ready for disruption?’), sponsored by Mastercard, we examined the current payment practices and the reasons why they exist. We conclude that the prevailing inefficiencies pose a significant market opportunity for technological disruptors. In particular, we believe that tremendous efficiency gains can be achieved through technological solutions that:
- Support the simplification and/or automation of invoicing and payment practices, especially for small and medium sized shippers and forwarders
- Create trust or provide payment guarantees between stakeholders so that ‘Cash Against Documents’ practices are no longer required
- Streamline and solidify the end-to-end workflows of quotation requests, quotations, booking requests, booking confirmations, fulfilment of the transport service as booked, in alignment with invoicing and payments across the transport chain without errors and re-work.