How much your company overpays on freight (and doesn't know)

In operations without systematic checking, 3% to 8% of freight invoices carry some overcharge. In most cases it isn't fraud — it's the detail no one checks: mismatched weight, an uncontracted fee, a rate table raised ahead of schedule. High invoice volume and complex rate tables per route and mode do the rest. The result is a recurring cost that goes unnoticed.

The good news: this money is recoverable, and the audit has a self-funding ROI — you pay with part of what you recover. Here's where freight leaks.

1. The 8 overcharges that show up most

1. Mismatched weight or cubage. Freight calculated on a weight or volume higher than the real or contracted one. The champion of discrepancies.

2. Redelivery charged wrongly. A new attempt billed when the failure wasn't the shipper's.

3. Incorrect ad valorem. Percentage applied on the wrong invoice value or above the contracted rate.

4. Uncontracted extra fees. Scheduling fees, handling surcharges and the like that aren't in the contract.

5. Outdated rate table. An increase applied before its due date or with a different index than agreed.

6. Risk-management fee on the wrong base. A cargo-risk surcharge calculated on a value that isn't the goods' value.

7. Duplicate tolls. Tolls already embedded in the table or counted twice on the route.

8. Incorrect route classification. A destination slotted into a distance band or region more expensive than the real one.

2. How to build the check

Auditing freight means cross-checking, invoice by invoice, what was charged (the freight invoice) against what was contracted (the rate table and rules). The step-by-step:

• Gather the period's freight invoices and the current rate table, with all fees and rules.
• Cross-check weight/cubage, distance, fees, indexes and increase dates.
• Classify the discrepancies by type and value — prioritize what weighs most.
• Dispute and recover the retroactive amount; renegotiate whatever is above market.

3. One-off vs. continuous

A single sweep recovers once. But without recurring checking, the leak returns in next month's routine. That's why the gain that sustains is in continuous audit: a monthly check, automatic disputing of known discrepancies, and a dashboard showing how much was identified, disputed and recovered over time. The Govern phase of the MK Cycle applied to freight.

Conclusion

Three points: (1) 3% to 8% of invoices carry overcharges when no one checks; (2) auditing means cross-checking the freight invoice against the rate table, invoice by invoice, and recovering the retroactive amount; (3) the lasting gain is in continuous checking, not the isolated sweep.