SAP Freight Costs:
SAP Freight-Cost-Monitor from SERKEM optimized Freight-Costs-Settlement & Freight-Cost-Check in SAP

TRUMPF Success Story

The Customer

TRUMPF GmbH & Co. KG,
family-run technology company with 64 subsidiaries worldwide

The Project

Increase the accuracy of the freight costs check and replace the manual review process of the invoices of logistics service.

The Solution

SAP freight cost monitor as an automated solution for electronic freight costs settlement and freight check in SAP

Results of the project

  • Electronic freight cost settlement in SAP

  • Automated freight cost verification in freight cost monitor

  • Savings of more than 250.000 € in the first year
  • Increased accuracy of freight costs check

  • Minimization of manual effort in freight cost management

  • Automatic postings by the system within the tolerance limit

“We have reached our project goals to 100% and plan to implement the freight costs monitor of SERKEM at other locations in the future. As the solution was fully implemented in SAP, no additional license costs incurred. And due to the open, transparent program structures we (TRUMPF) can perform rollouts largely on our own.”

Christian Füssel, project manager, TRUMPF GmbH & Co. KG

TRUMPF

The whole story

 

TRUMPF – The Customer

As an independent family business, the high-technology company TRUMPF provides manufacturing solutions in the fields of machine tools, lasers and electronics.

These divisions are centrally organized by the management holding company of the TRUMPF GmbH + Co. KG. A global network of comprehensive production, sales and service companies supports the holding.

In the global delivery of its products, TRUMPF relies on various logistic service providers. Besides quality and excellent products, highly efficient processes are one of the main priorities of the internationally operating high-technology company.

0
subsidiaries worldwide
0
mio. € in 2013/14
0
employees

The Challenge: At a glance

  • About 17,500 paper invoices from logistic service providers every year in Ditzingen for conducted freights
  • Invoices for 210,000 posts for replacement parts, service parts and spare parts
  • 16.000 items for machine shipping are invoiced
  • TRUMPF handles 90% of all freight orders with 5 logistic service providers, with which certain terms have been agreed
  • The manual audit of the freight expense reports is a time-consuming and error-prone process

TRUMPF – The Challenge

About 17,500 paper invoices from logistic service providers are incurring every year in Ditzingen for conducted freights. They include 210,000 posts for replacement parts, service parts and spare parts as well as 16,000 posts for machine shipping. TRUMPF handles 90% of all freights with 5 logistic service providers, with which certain terms have been agreed.

After receiving the invoices from the service providers, TRUMPF has to check them for deviations from the agreed conditions. An enormous effort, as the invoices can comprise of up to 200 pages. Altogether, the manual audit of the freight expense reports is a time-consuming and error-prone process.

„Due to the strong growth in the volume of shipments, it was foreseeable that a verification of the invoices in the future could only be done for random sample invoices. The recognition of incorrect statements would be by chance. The manual verification was neither audit proof nor complied with the requirements of a genuine control of the service provider.“

Udo Landgrebe, central logistics, TRUMPF GmbH & Co. KG

 

Therefore, it was the objective at TRUMPF to simplify the process considerably and to reach a significantly higher audit quality. During the subsequent tender, the SERKEM GmbH convinced TRUMPF with a directly implemented freight cost solution in SAP. All requirements of TRUMPF are user-friendly implemented in SAP. A freight-cost-monitor – the core element of the solution – enables monitoring and clear control of all operations.

 

TRUMPF

Automated freight cost verification in SAP

TRUMPF– The Project

The incoming electronic invoices from the service providers should be checked automatically and booked by the SAP system if they stay within a defined tolerance range. Positions with values outside of the threshold value should be marked and manually checked in the following step by the shipping department. At the same time, the new solution should be user-friendly for staff and international roll-outs should be possible without much effort, too.

In the first step of the project, the CEP service providers were connected. They cover about 98% of the time-critical spare part shipment and small part shipment – in total more than 210,000 shipment items per year.

Calculating the target freight costs in the freight cost document

For each delivery the SAP system creates a transport cost document and a freight cost document . In the freight cost document, the target freight costs are calculated in advance based on the stored conditions for each service in SAP. The basis for the calculation is either gross weight, volume or loading meter.

Simple condition maintenance in Excel

The conditions can be maintained easily. The employee can edit the conditions via excel spreadsheets und update them in the SAP system. Up to 20 condition types with any number of specification values can be stored and maintained per freight forwarder. Each agreed condition has its individual validity period. Surcharges for distance, weight, hazardous materials, incoterms etc. are taken into account in the calculation of target costs, too.

Convert invoices and import into the system

The electronic invoices and proofs of delivery of each service provider are transmitted as a single invoice in a variety of formats and converted into a consistent SAP IDOC format. Then, the converted bills are transferred to the module PI of the TRUMPF-SAP system and uploaded into the freight costs monitor.

Check for deviations between target and actual values in freight costs Monitor

The individual positions will be checked for deviations from the pre-calculated freight costs and agreed delivery times by the freight cost monitor: The previously determined nominal values and the actual values of the incoming invoices are now compared at item level.

Automatic postings within defined tolerance limit

If the deviation is below the preset threshold, the invoice item would be posted automatically in the SAP system and is thus integrated into the financial accounting. The position is posted in SAP and the process is archived in the system.

Notification if threshold is exceeded

If the threshold is exceeded – e.g. “express” is ordered to 10 o’clock, but the delivery is after 10 o’clock, or the target costs are exceeded by more than 3%, the shipping department receives a notification about the deviation from the system. The position is automatically highlighted in the table for the manual check by the shipping department.

In this case, the freight cost monitor gives the responsible person access to the entire process files, including the shipment data of the service provider as well as other comments and information. Complaints can be send as a message to the CEP provider. Finally, communications can be documented or carried out with the service provider.

The control of delivery times was of particular importance for TRUMPF. Based on the shipping terms, the latest delivery time is now determined and then compared with the actual delivery time transmitted by the CEP. TRUMPF pays in future only surcharges for express shipping when the delivery is in time.

Karin Maier of TRUMPF is impressed by the solution:

„A package scanner in the depot of a service provider was configured incorrectly. Therefore, the service provider scanned the packages too big, which is why some packages were classified in the next higher fare class. Thanks to the freight cost monitor from SERKEM, we noticed the pattern behind the discrepancies immediately, as the simulated rates for these packages deviated always by the same factor from the invoiced tariffs. Without the monitor we would not have noticed this problem so fast.“
Karin Maier, TRUMPF GmbH & Co. KG

Meanwhile, TRUMPF is handling 99% of all CEP invoices and 98% of all CEP shipments in Ditzingen with help of the SERKEM freight cost monitor. More than 96% of all invoice items are now booked automatically. Only for 4% of all invoices a manual intervention is necessary.

Advantages of the SERKEM solution in SAP

The integrated SAP solution offers additional advantages:
All the information can be accessed worldwide in SAP and the complete data base is available in SAP for reporting. The entire solution is audit proof, because the billing raw data and the PDF invoice are attached to the transportation document and the financial accounting document.

Savings of more than € 250.000 in the first year

TRUMPF saved more than 250,000 € thanks to the use of the SAP-based freight cost monitor in the first year . At the same time, the SERKEM-monitor serves as a tool to evaluate the delivery reliability of the service provider more efficiently.

And even the services providers of TRUMPF benefit from the SERKEM solution: the extensive automation shortened payment times significantly.

„We have reached our project goals by 100% and plan to implement the freight cost monitor of SERKEM at other locations in the future. As the solution was fully implemented in SAP, no additional license costs incurred. And due to the open and transparent program structures, we (TRUMPF) can perform rollouts largely on our own.“
Christian Füssel, project manager, TRUMPF GmbH & Co. KG

 

„For us as service provider, it is important that the customer has complete knowledge about the solution at the end of the project. They should be able to develop it further independent of us– we do not want to bind the customer with license agreements but convince him with our performance to choose us as implementation partner for the next project as well,“ supplemented project manager Sascha Reischl of SERKEM..

Downloads & additional informationen

SAP Frachtkostenmonitor