Outsourcing transport related administrative processes can be attractive to many companies as standard ERP systems are often not able to handle the complexities of the freight business. As a result, a high level of manual intervention is needed. The decentralised management of freight orders in multinational companies can cause additional administrative and audit problems.

Problem…

ControlPay offers a web-based electronic solution that was developed in co-operation with Deloitte to ensure the best possible accuracy and auditing procedures. Based on existing carrier agreements between shippers and carriers and subsequent transport orders, ControlPay’s application calculates the exact freight costs. The system then instructs the carrier which amount should be invoiced and supplies all other relevant payment information. When the carrier responds with the actual invoice, the invoice information is checked against the system and if correct, ControlPay instructs the shipper to pay the amount.

The missing link in this procure-to-pay chain was ControlPay’s ability to offer its customers the execution of the payment itself. In order to provide the complete outsourcing service from transport order management to payment, ControlPay required a strong cash management bank. Henk Jan Kinds, Financial Officer Accounts Payable, summarises ControlPay’s needs: “We were looking for a bank which could offer us a global solution, because initially we are focused on Europe, but in time we will be making payments globally. In addition, we needed access from all over the world to be able to pay. We also needed a system which would allow us to make the invoices which we were paying visible to both our customers and their carriers.”

…Solved

ControlPay invited a number of banks for tender and eventually selected Deutsche Bank’s db-direct internet solution. “The functionality of db-direct internet was important to us as well as the proven record of that application. db-direct internet had a better functionality than the other solutions we looked at. In addition to that, the pro-active attitude of Deutsche Bank towards our needs was also an important factor,” states Kinds.

In Europe, ControlPay wished to open a single euro account for each customer. Deutsche Bank’s commitment to SEPA was therefore a key factor. Meanwhile, in order to cope with the future growth of ControlPay’s operations around the world and particularly in Asia, Deutsche Bank‘s extensive global coverage was another important consideration.

ControlPay now opens a Deutsche Bank account for each new customer. As Kees de Jongh, COO of ControlPay explains, “This is for the simple reason that we want the whole fund flow to be completely visible to our customers, who have a view function to their account.” This is achieved by linking Deutsche Bank’s db-direct internet application to ControlPay’s web-based system. Payment related MT940 messages automatically update ControlPay’s system, which then makes the information visible to both the shipper and carrier concerned. Once the shipper has funded its Deutsche Bank account, ControlPay’s application is updated and the payment to the carrier is initiated in db-direct internet.

Finally, db-direct’s internet functionality strongly supports ControlPay’s audit-centred business approach and imminent SAS 70 type II certification, which will validate the compliance of ControlPay’s procedures and processes with Sarbanes-Oxley.