Client
Our client is a market leader in oil field logistics and transload services. They own and manage a nationwide network of transload terminals where they store and move millions of pounds of bulk sand, crude, and other materials to and from trucks, railcars, silos, and other containers. Their services are a critical element in the energy supply chain in North America.
This client operates transload facilities, where they transfer products between trucks, railcars, and on-site storage containers. They specialize in transloading frac sand for the oil and gas industry, particularly in the Southwest, although they handle a variety of materials at locations all over the country.
Problem
The railcars, trucks, and materials they handle do not belong to the logistics service provider, but rather belong to their clients, who either produce and sell materials or consume them. Either way, they need to move large quantities of bulk materials using multiple modes of transport, which our client facilitates.
The client’s business is not based on the products they handle, but on the handling itself. As such, they bill their clients based on the weight transported, with rates varying based on location, customer, mode of transport, material type, container type (silo, hopper, warehouse, etc.), and various other factors. Some of these rates are set on a sliding scale based on volume. Some include minimum volumes that must be achieved within a certain time frame.
They also bill demurrage fees for railcars stored at their facilities, which vary based on the type of car. Most of these are actually charged by the railroad and passed through to the client. They typically have a certain number of free days, with a charge daily for each day after that threshold.
Many of our client’s customers are multi-billion dollar companies, and their requirements can vary greatly. As such, each contract is negotiated separately and will have different terms.
Because of all this, calculating exactly what each customer owes them at the end of the month is an extremely complex task. Data on every truck to visit each facility was being exported into a spreadsheet, and the accounting department would add all the various calculations, manually entering the more complex variations. But as the business grew, this became too time-consuming, and they simply could not keep up.
Solution
We built them a system where they could enter all the complex details of the billing agreement for each contract. Then we built a report generation system where they could grab all the transactions for each customer, have the fees automatically calculated, and quickly review them. Once reviewed, they would click a button and all the transactions would be exported to their accounting software, and an invoice would be generated. Later, as the client’s business grew, we modified the export to send the transactions to an enterprise ERP system instead.
Complex transload contracts can be configured, with rates that differ by source type, destination type, time of day, and a number of other factors. Each contract has a specified date, so that if the contract is renegotiated later, new rates can be applied to future trucks, while the old rates are applied to older trucks. 
All charges are reviewed first by the operations manager for the facility, since he will be most aware of activities at the facility. Once the operations manager, the data is sent to accounts receivable. 
The accounts receivable department can review all charges in the application, grouped by terminal and customer. 
If the accounting team notices an irregularities in the charges, they can flag them, sending them back to the operations manager to review again. 
The accounting team can also place holds on charges. This keeps them in the queue so they can be billed later, but excludes them from the current invoice. 
The charges are totaled up and sent to our client’s ERP to create a new invoice. The detailed itemized report is provided to the customer as an addendum to the invoice.
Result
This system allowed them to recoup lost revenue that would have been missed by the manual process, and easily generate accurate invoices for all their clients with only a couple of accountants, instead of an army of analysts, which they would need at this point.