Many logistics, shipping and transportation companies live and die by their relationships.
That’s probably why PYMNTS data in the report “Accounts Payable Automation: Transportation Companies Innovate To Drive Growth,” done in collaboration with Routable, finds that when investing in innovations to modernize their business, members of the industrial economy tend to prioritize the solutions that will result in an improvement in their relationships with their vendors.
More than 8 in 10 logistics, shipping and transportation companies (83%) say they plan to innovate their accounts payable (AP) systems to strengthen their B2B relationships — and more than 3 in 4 (78%) indicate that faster payment speed will help them to do so.
Payment transparency and the ability to pay vendors and partners in their local currencies are some additional benefits that over half of these firms hope to realize through AP modernization — all key value-adds to a B2B partnership.
Underscoring this shift across the sector, Raz Ronen, CEO at FreightTech startup Wisor.AI, told PYMNTS in an earlier discussion that, “There’s legacy businesses, family businesses, old traditional companies that have now reached a point in the last two years where they understand that if they don’t take the next step, they will have troubles, they might even close, because they now need technology to provide the right level of service that their customers are looking for.”
Read more: Shipping Sector Finds Smarter Ways to Operate Using Generative AI
Zvi Schreiber, CEO of trade tech solution Freightos, separately described to PYMNTS how the international freight market being a “largely offline endeavor” has resulted in “tens of billions of dollars of waste.”
That’s because transportation, logistics, and shipping companies, no matter their AP systems, are processing their payables at high volumes.
Of the firms surveyed by PYMNTS, 71% process an average of at least 1,000 payables each month, and 72% of those businesses expect their payables to rise by 11% or more over the next three years. With this much volume, manually writing and mailing checks simply is not a viable solution — but it’s still one that many legacy operators turn to.
Fortunately for their business partners and vendors, over the last couple years, the transportation, logistics and shipping business has undergone a foundational shift to become increasingly digital, with companies moving away from Excel spreadsheets to online platforms.
Most of these businesses recognize that AP innovation is the key to overcoming the limitations of their current systems, as well as much of the historic fragmentation across the industry.
“We’re moving beyond the days in which emails, paper and even handwritten invoices have gummed up the works, and ultimately have kept payments (and thus goods) from getting where they needed to go,” Flexport Chief Financial Officer Kenny Wagers told PYMNTS.
Get the report: Accounts Payable Automation: Transportation Companies Innovate To Drive Growth
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