1.7 million packages get stolen or go missing every day in the US.

15% of all deliveries in cities fail to reach customers due to package theft or wrong addresses, according to the New York Times. That’s a staggering number.

This amounts of over $25 million in value every day just in New York City.

Did you know that if you receive a package that was delivered to you, but intended for someone else, you can legally keep that package? You are not obligated to return that package to sender. Imagine the massive losses retailer incur, especially for electronics and other high value packages.

With COVID-19 slamming eCommerce and logistics companies with unprecedented volumes, no wonder the rate of stolen and disappearing packages has also skyrocketed 20%.

This problem not only plagues customers, delivery carriers, and shipping insurance providers, it most strongly hurts retailers, merchants, freight forwarders, and distributors.

A number of innovations have begun to address these porch pirate, logistics, and last mile delivery problems: warehouse robotics, delivery robots, Photo-on-Delivery, micro-warehousing, package receiving hubs, package lockers, and many more. One of the lowest hanging fruit through is automating label scanning and paperwork.

We haven’t even yet talked about “reverse logistics”. UPS says that it processes 1 million returns a day in the month of December. This peaks at 1.9 million packages on January 2.

Most freight forwarding, warehousing, and distribution companies still process shipping labels manually. Freight forwarders, package sorters, and distributors can 30 seconds to 5 minutes per package to receive, sort, open, inspect, repack, repackage, and forward the packages to their next destination. Higher volume shipping companies and logistics providers may outsource the process to humans, which causes on average 1 hour to 2 days of delays. The costs from those delays in package processing can easily outweigh the savings in labor costs. Humans still make plenty of mistakes.

Shipping companies admit that insurance is a large cost for them to deal with exceptions, lost packages, porch pirates, damaged items, returns, fraudulent returns, etc. AI and computer vision can lower the costs of insurance claims and lost packages by enabling deliverers to do Photo on Delivery, and recipients to confirm receipt of their packages. This closes the logistics loop. Merchants and senders get assurance from recipients that deliveries were successful.

Most shipping companies don’t dive into SKU-level traceability, but insurance claims need package, packing list, and item / SKU level traceability. Between 1–15% of packages fail to make it to their intended recipient depending on the location, route, season, carriers, and many other factors. That is even more massive waste especially for high value shipments, such as electronics, medical, and B2B shipments.

Even if lowering insurance fees is not the main source of cost savings — merchants and shippers themselves want to lower receiving and returns fraud and mistakes — i.e. people saying their package/items were damaged or never received. That’s a major cost to merchants. Merchants should know that their customers received packages and items down to SKUs, data which is useful for returns, damaged items, claims, and dispute resolution.

Many food delivery companies now have their deliverers take smart phone photos of their packages at the point of delivery — Photo on Delivery — which is critical proof of successful, contactless delivery. It reduces fraud, erroneous orders, or just confusion of where the delivery was dropped. AI can save millions of dollars of fraudulent or erroneous insurance claims, missing packages, and deliveries. To incentivize recipients to confirm receipt by snapping a photo, there are a lot of creative options. B2B recipients especially may care more about SKU level receipt confirmations, as their orders are more complex and valuable. Insurance claims may require SKU-level data, because insurers need to know the package and insurance value.

When a package gets lost or stolen, who loses?

Hint: it’s not only one of the following:

• Insurer
• Merchant
• Shipper
• 3PL
• Customer

Many people might think that the problem is isolated to the insurer. In reality, the answer is that everybody loses.

The only person who gains is the thief.

Shipping insurance providers will not claim responsibility over any packages that were scanned at the point of delivery. It can take months to be approved or denied insurance claims. It is an extremely costly and time consuming process. Merchants don’t realize that if the product is defective, or if it’s never received by them, there is no recourse. There will be no replacement or refund. The merchant is out of luck. It’s a lose-lose situation, especially for shippers and merchants. Delivery exception management is a big deal for shippers and merchants. It’s time for merchants and shippers to come together to solve this massive delivery inefficiency. How can we get more people to claim when they actually receive their packages? How can we incentivize them to do so? How can we create a service offering that solves this problem? This is a problem that can be solved by us working together. This is an interesting problem to solve and will have significant benefits to all involved in the supply chain.

About Photon Commerce:

Photon Commerce’s package automation solution is the only solution in the industry that can capture shipping labels at super-human level accuracy. Photon Commerce’s computer vision and AI data validation solution collects data from YRCW, LMS, and over 100 other merchants, fulfillment centers, warehouses, freight forwarders, distributors, retailers, 3PLs, importers, exporters, package management, and logistics providers. Its API, scanning, and smartphone scanning technology tracks all of your packages and items across the supply chain network from the warehouse to the door. The data can be from any number of formats: smartphone app, mounted cameras, conveyor systems, scanners, PDFs, or even email or digital receipt.

Photon Commerce cuts down on lost packages and SKUs by delivering super human level accuracy for shipping label and packing list OCR, data extraction, and validation. These all can be used to scan parcels and packages in the warehouse, at the point of delivery, or in transit. The cloud-based API management system automatically verifies and updates data, providing global visibility to merchants, senders, logistics teams, vendors, and customers. With a simple tap, drivers or warehouse receivers are then able to pick up the parcel and scan its label to record the drop off or receiving point. Photon Commerce delivers:
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• Address validation
• Name, alias, ATTN, unit number, building, and account lookups
• Reference and PO number extraction and lookups
• Description of contents
• Classify contents to categories and SKUs
• Weight extraction
• Automated reconciliation to proof of deliveries, bills of lading, packing lists, and invoices

Fulfilling the need to capture, verify and update information in real-time across the supply chain network with a smartphone app, Photon Commerce enables postal and delivery companies to perform the three daily tasks of scanning, sorting and tracking parcels and packages in a second.

​Check out this link for more information. Reach out at fastershipments@photoncommerce.com to get a free assessment on how you can speed up your shipments and reduce exceptions.

Level III (or level 3) data refers to providing specific line item details at the time of a purchasing card or government card transaction beyond what is required for consumer card transactions.

​This data is incredibly important because including that with your transaction data significantly reduces risk and nets you savings on interchange fees. As a vendor, if you accept a lot of sales from government agencies or corporate purchases where a corporate credit or purchase card is used, inserting level 3 SKU data into the transaction will net you significant cost savings on processing fees.

In order to save money on credit card processing fees, you should ensure that your payment gateway is configured to accept Level III data for sales made with corporate purchase cards and government agency cards. If you sell to a lot of government agencies and corporate customers – and you want to save money on processing fees – this is one of the most important things to consider.

Why do I care about Level 3 / Level III Credit Card Processing

Level 3 / Level III credit card processing is important because it allows you to receive fee savings by providing more data about the transaction at the time of sale. This can result in lower interchange fees, which means you pay less for processing each transaction. For those who deal with a lot of bulk or volume sales, the savings can be significant.

Some additional benefits of level 3 / level III credit card processing include reduced chargeback rates. Adding level 3 data to your transactions reduces the chance of fraud or unauthorized transactions as well as reduces the risk of chargebacks.

Adding level 3 data to your transactions reduces the chance of fraud or unauthorized transactions as well as reduces the risk of chargebacks.

Eliminating chargeback losses: A chargeback occurs when a customer returns an item they purchased from you and cites fraud or unauthorized use as the reason for the return. These things cost you money and can severely impact your business, but by adding level 3 to your transactions you can eliminate many of these chargebacks entirely and save yourself time and money.

Faster reconciliation:

If your merchant account is set up to receive level 3 data with every transaction, it makes it easier for your merchant services provider to process receipts faster in the event of a dispute or fraud. This can save you time and money in terms of time spent getting paperwork together for a dispute or chargeback.

If your merchant account is set up to receive level 3 data with every transaction, it makes it easier for your merchant services provider to process receipts faster in the event of a dispute or fraud. This can save you time and money in terms of time spent getting paperwork together for a dispute or chargeback. Improved customer service: By providing more information about each transaction, your customers benefit from a better purchasing experience and it can help improve your overall customer service.

By providing more information about each transaction, your customers benefit from a better purchasing experience and it can help improve your overall customer service. More accurate reporting: Level III data is used to provide more accurate reporting of sales in your accounting system as well as for sales tax reporting. This can be especially helpful if you have sales tax reporting requirements that are specific to your industry or state.

Level III data is used to provide more accurate reporting of sales in your accounting system as well as for sales tax reporting. This can be especially helpful if you have sales tax reporting requirements that are specific to your industry or state.

Enhanced product quality control:

Level III data can help you improve the quality control process throughout your business by providing more detailed information about each transaction so that you can track sales more easily. For example, if you have a product that is sold both online and in a brick-and-mortar store, Level III data allows you to track online sales as they come in without having to wait until you run reports and pull information from both locations separately.

Level III data can help you improve the quality control process throughout your business by providing more detailed information about each transaction so that you can track sales more easily. For example, if you have a product that is sold both online and in a brick-and-mortar store, Level III data allows you to track online sales as they come in without having to wait until you run reports and pull information from both locations separately.

​Better protection against chargebacks:

It’s often easier for a customer to dispute an online purchase than it is for them to return something that was purchased at a physical store. 

Book a demo today with Photon Commerce

How does the 3-way match work in Accounts Payable (AP)?

​Three-way matching is the checking that what you order matches what receive and that matches you pay for.

The three key documents there are:
​

1. Purchase Orders (POs)
2. Invoices
3. Receipts, packing lists, or order confirmations

Discrepancies can occur during any process, including damaged products, different SKUs, stolen packages, differences in prices, lost items, and many more. 

What is a 2-way match vs 3-way match?

Two way matching is a simple check that validates invoice details against order receipt details. This type of checking does not take into account purchased quantities or prices. With three way matching, the PO and order receipt are also cross-checked for consistency, thus providing the buyer with a more comprehensive level of detail for each transaction. In turn, this lends itself to a higher degree of accuracy and a more secure environment in which to manage payments.

The killer app of the personal computing (PC) revolution was the spreadsheet, called VisiCalc. VisiCalc was the very first business software to be invented on the first PC, made by Apple. Without the spreadsheet, PCs would have quickly failed to be adopted in the market. Spreadsheets were the killer app for accountants. Not only did professional accountants need spreadsheets, which is like a calculator on steroids, every body needs a PC to do simple calculations, like accounting for totals, doing taxes, organizing data, keeping records, etc.

Companies started to use computers to match invoices with purchase orders, driving down costs and increasing efficiency. By the 1980s, businesses had developed the third element in 3 way matching: the order receipt. By adding the receiving report to the process, businesses were able to match receipts, invoices, and purchase orders in an effort to reduce errors and ensure that orders were delivered as ordered and on time.

3 Way Matching: Why You Should Use It

3 way matching is based around reducing the overall risk associated with payments and can be especially valuable for small and mid-sized businesses that may use an online payment platform. Although 3 way matching appears to be a relatively simple process, it can have an outsized effect on your business’ bottom line. This is because 3 way matching allows you to verify the Cost of Goods Sold (COGS) or services ordered, Cost of goods or services delivered, Quantity of goods or services delivered, and Prices paid for products or services received.

To help you determine whether 3 way matching is right for you, let’s take a look at some of its benefits.

Benefits of 3 Way Matching

1. Reduced payment fraud: Incorporating 3 way matching into your accounts payable processes will decrease the risk of payment fraud by helping to identify and prevent duplicate billing and duplicated shipments. If any discrepancies are found, payments will be withheld until they are resolved.
   
   
2. Traceability & Accountability: 3 way matching helps solidify accountability and traceability in every facet of your business from suppliers to customers, which bolsters confidence throughout your organization.
   
   
3. Improved Purchase Order Quality: By implementing 3 way matching into your accounts payable processes, you will ensure that your purchase orders are complete before being authorized and processed. Reduced Processing Time: The three way match process has a built-in delay that oversees the processing and reconciliation of invoices before they can be paid. This delay gives you more time to review and approve invoices, improving efficiency in the accounts payable department.

​

B2B payment defaults have increased 72% year-on-year in the US, according to the United States-Mexico-Canada Payments Practices Barometer.

As COVID-19 tests and disrupts supply chains around the world, 43% of invoices were unpaid by the due date, which is a 25% increase from last year. Invoices long overdue (surpassing 90 days overdue) have doubled in value. 4-8% of total value of outstanding invoices have been written off as uncollectable.

With North America along with most other parts of the world in economic recession, there have been a record number of deductions, adjustments, partial payments, and negotiations around invoicing. 

The USMCA sees the three countries of North America to continue contracting well into 2021. The USMCA Payment Practices Barometer reveals that immediate action is needed to cure the payment crisis and bring back economic prosperity.

The cost of compliance is eroding the bottom line to the point where many companies are abandoning their businesses or having to lay off staff. 

Merchants who provide "Level 3" data to their credit card processors can save up to 50-100 basis points on credit card interchange fees. That is nearly halving your payment processing costs.

Most merchants are unaware of that this was even possible!

What is Level 3 data?

In addition to provided standard merchant name, purchase amount, date, and billing zip code, the merchant will also share SKUs, unit prices, quantities, shipping fees, and line item totals. 

What exactly are the benefits?

The 5 key benefits are:

1. Lowering your payment processing fees by 50-100 basis points
2. Faster settlements
3. Greater sales
4. Speed up accounting reconciliation with SKU level data
5. Reduce chargebacks, fraud, and errors

If you have set up for Level 3 data processing, your payment processor will send credit card machine data to the card networks for you, which will reduce the likelihood of chargebacks and increase your ability to dispute fraudulent transactions.

How much do I really save?

Merchants pay 2.9% fees for default Level 1 payment methods.

Upgrade your system to Level 3, and you only pay 1.9%. Save 100 basis points. Cut your costs by 34%.

The 3 Levels of Payments Data Processing

Level 1 Data:

This is the lowest level of data available and is essentially just the card number and a few pieces of information about the transaction. This is what most payment processors charge for and it’s the most basic level of payment processing.

Level 2 Data:

This is the first step up above Level 1 data and includes a little more information about the transaction such as sales tax amount, invoice number, and order number. Level 2 data also provides your payment processor with a lot of information about the products and services you sell which they can use to help with managing fraud.

Level 3 Data:

This is the highest level of data available and this includes a lot more information about your products and services such as item description, product codes, unit price, wholesale price etc… You’ll also find that with Level 3 data, some of the information will be encoded and encrypted so that only your payment processor can decode it. Keep in mind that not all payment processors provide the same level of service when it comes to providing Level 3 data to their merchants. And because Level 3 data is so vital to anyone who accepts credit and debit cards there can be a lot of variation in pricing for merchants in this space.

Who does Level 3 data impact most strongly?

1. Merchants
2. Accounts Payable and finance departments and organizations
3. Bill payments companies
4. Payments processors
5. Expense management businesses

But there are still fees with credit cards, why should I accept them?

In a world shaken by COVID, payer adoption of digital, contactless, eCommerce, and other innovative payment methods have accelerated by years. Buyers prefer to pay invoices with credit cards because they get rewards, cash-back, and convenience. Merchants get paid faster when accepting credit cards, instead of waiting weeks for check, ACH, EFT, and wires. Merchants miss out on significant business if they fall behind in payments innovations.

What are the specific data fields?

Level 1 (Standard)

• Merchant name
• Purchase amount
• Billing zip

Level 2

All Level 1 fields, plus:

• Sales tax
• Customer code
• Invoice number
• Order number
• Tax indicator

Level 3

All Level 1 and Level 2 fields, plus:

• Product code
• SKU description
• Quantity
• Shipping amount
• Discount
• Line item amounts

References:

1. Wikipedia Card Transaction Data 

It's not the most intuitive thing that satisfied vendors can lead to satisfied customers. Implementing a modern Vendor Portal or Supplier Relationship Management system is key to streamlining your supply chain and minimizing errors, costs, inventory, and shrinkage.

1. Free up your time from managing your vendors so that you can focus on getting more customers
   
   
2. Vendors may ship the incorrect quantities, products, or packages to you. Logistics companies spend a large fraction of their operations teams doing manual exception handling and error resolution. Automate the reconciliation process to ensure that every item, package, order, shipment, and detail is tracked in real-time. 
   
   
3. Vendors, shippers, customers, and logistics teams get real-time visibility, preventing wasted time asking "Where's my package?", "Where's my check?". All of these answers are captured and updated in real-time in the portal.
   
   
4. Eliminate blind arrivals. Vendors may forget to send Advance Shipping Notices (ASNs) to their warehouses, distributors, or fulfillment centers. Blind arrivals are especially prevalent with shipments that arrive in small parcels and Less-Than-Truckload (LTL) freight. Blind arrivals are received shipments that are unexpected, lacking advance notice. These packages can cause confusion in accounting. It gets even more complex if the senders have multiple identities, entities, names, aliases, addresses, and order numbers. 
   
   
5. Centralize all of your logistics, accounting, and inventory data into one place. Having hundreds of spreadsheets fly around in inboxes every month can lead to costly errors, discrepancies, and mistakes, not to mention time lost. 
   
   
6. Track and trace all edits, movements, and approvals. 
   
   
7. Amend mistakes easily. Let's face it, logistics is still a very human business. SKUs may be entered wrong, invoices or packing lists may contain errors, totals or prices may not always add up. SKUs may be discovered to be on backorder or delayed. Logistics teams and vendors can make updates in real-time, with logic built in where only before certain points can certain data be amended. 
   
   
8. Get an aerial view of your operations, with an analytics dashboard that shows totals, statuses, and breakdowns of accounts in any way you'd like to slice the data. 
   
   
9. For businesses that are outgrowing Excel, Quickbooks, and yet do not find SAP or Oracle to have a 'delightful' experience, a Vendor Portal is the easiest way to organize your experience with your vendors, operations teams, and customers. 
   
   
10. Make vendors, distributors, and customers enjoy and delight the experience in working with you. No more chaotic and disorganized workflows over email, Whatsapp, phone, and texting. Modernize the way you work with vendors and customers. 

A modern approach to vendor and customer management

Photon Commerce's Vendor Portal streamlines ordering, shipments, receiving, inventory, and payments in a single page. Optimized for eCommerce distributors, wholesalers, Buyers Clubs, fulfillment centers, warehousing, 3PL, and 4PL businesses, the vendor portal reduces friction, errors, exceptions, time, and discrepancies between vendors and customers. Over 100 distribution and logistics use Photon Commerce every day, accessing over 100,000 vendors. Photon manages millions of dollars of SKUs and shipments a day.

The packing slip is a key shipping document that just might get the least love.

What is a packing slip?

It is that piece of paper awkwardly shoved behind the shipping label in that pouch, or is sitting between you and your items, separating you from continuing your unboxing therapy.

What do I do with this awkward piece of paper? Most people might send it straight into the garbage with a half-broken down box...

Packing slips tell you what is supposed to be in your package, so that you can account for what you order and receive.

Why is it important for businesses to properly process packing slips?

Packing slips are essentially receipts, confirming that you've received the contents of that package. Packing slips contain critical information about your orders, vendors, SKUs, products, descriptions, units of measure, and quantities. 

What is involved in receiving and accounting in eCommerce?

A single order could come in over many shipments, packages, and packing slips. It's important to account for your received packages and items, so you don't discover missing items before it's too late. Buyers should only pay for items that they receive, not items that they order.

In eCommerce, 15% of packages are lost, damaged, delivered to the wrong address, stolen by "porch pirates", or contain the wrong items, as reported by the New York Times.

​Nearly 20% of eCommerce products are returned. That's a lot of room of errors and exceptions to happen between shipment and receiving.

In an increasingly digital world, the packing slip is still obviously on paper. 

What's a solution to organize and process packing slips, to go from paper to digital? 

Photon Commerce introduces a unique solution missing in the industry. It digitizes, organizes, and reconciles all of your packing slips. It reads the packing lists, whether they are a paper scan or a PDF, extracts all of the data, and imports them all into your inventory and accounting software. It even automatically matches packing slips to invoices, order confirmations, and POs down to line items, SKUs, and quantities. 

Photon Commerce digitizes tens of thousands of packing slips a day across millions of items for modern eCommerce and logistics businesses large and small. No more manual data entry, reconciliation over endless spreadsheets, or arguing with your suppliers on where your missing items are. With more accurate inventory, prevent stock-outs, wrong orders, and angry customers.

Reach out at packingslips@photoncommerce.com to see how you can organize all of your orders, SKUs, receiving, invoicing, inventory, and accounting. 

NVIDIA's GTC 2020 conference will also host an interaction session with Photon Commerce. The group will be discussing the latest trends in NLP, computer vision, GPU-accelerated machine learning training, and document understanding. 

Check out the session

Moore's Law...is officially dead. The digital age has now transitioned to "Huang's Law", thanks to NVIDIA. The NVIDIA GTC conference is happening this week. Photon is speaking during a session about how cutting edge AI can understand documents.

How to understand documents using AI: NVIDIA GTC 2020 Photon Commerce

Check out why NVIDIA's historic $40B acquisition of ARM.

More's Law is dead. Long live...Huang's Law.