Wholesalers and manufactures using their own trucks to make deliveries will often have their B2B customer sign for the delivery. Why do they do that? It turns out there can be a lot of value in doing so – especially when that process is automated and integrated with your ERP.
What do we mean by proof of delivery?
Proof of delivery is an important acknowledgement that a product delivery has been completed. Typically a customer representative signs on a mobile device indicating that all of the contents were received. Proof of delivery may also include a photograph of the merchandise, either on the receiving dock of the customer, or at the retail point of display.
Proof of delivery processes may also include barcode scanning and geo-coding of the transaction.
Why is proof of delivery important?
#1 Reduced payment disputes
Fewer payment disputes naturally leads to even better customer relations – and better realization of your receivables. Obtaining proof of delivery quite simply makes financial sense. Let’s say for instance that ABC Supply Company delivers $30 million in product annually. Further, let’s assume that 2% of deliveries are disputed, that’s $600,000 at risk. By requiring electronic signature, if those disputed payments can be reduced by 75% that would be a $450,000 improvement in the bottom line. Not everyone’s results will be the same, but especially in a low margin business, that kind of improvement can greatly improve profitability.
#2 Improved driver accountability
Geo-coded transactions improve driver accountability by telling you exactly where they were when the customer signed for the products. We’ve worked with clients who deliver products with high consumer appeal – tobacco and vape products, energy drinks, packaged automotive fluids, the list goes on. Combining electronic signature capture with geo-coding has been shown to greatly improve driver accountability and reduce inventory loss and theft.
#3 Greatly reduced administrative costs
Administrative costs can also be greatly reduced by employing proof of delivery apps. Companies accepting manual signatures on printed delivery forms have the time and expense burden of scanning the signatures, attaching them to transactions in the ERP system and then filing them away for later retrieval. If your business makes 50 deliveries per day, that’s about 12,500 per year. If a customer service rep spends 5 minutes per delivery scanning a signature, attaching it to the appropriate location in the ERP system, then filing it away – that’s about 1,000 hours per year. Assuming that role is a $30,000 per year person, that means $15,000 per year in immediate potential savings.
Barcode scanning during delivery also aids in with proof of delivery as it ensures greater transaction accuracy (and speed).
xkzero can help
If you would like to learn more about how you can automate electronic proof of delivery integrated with Sage X3 (Enterprise Management), please contact xkzero at firstname.lastname@example.org or call us at 847-416-2009.