Gain share pricing is broken.

In the world of transportation spend management, there are three main pricing models used by audit and pay companies:

1. Gain share - the service provider earns a percentage of the amount they recover for you through invoice discrepancies.
2. SaaS subscription - you pay a fixed monthly or annual fee for access to the software platform and core services.
3. Volume-based - you pay a set fee per invoice or shipment processed by the service providers.

The SaaS subscription model is far superior for shippers and 3PLs who are serious about controlling costs and fixing the underlying issues causing invoice discrepancies. Here's why:

Gain share models don’t address core problems

Legacy audit and pay providers typically use a gain share pricing model, where they take a cut of the savings they identify. On the surface this may seem appealing - they only get paid if they find savings, so they must be doing a good job, right?

Well, the dirty secret of the gain share model is that these companies are actually incentivized to keep invoice issues around because that's how they make their money. They're not motivated to identify and solve the root causes of invoice issues and incorrect charges. Quite the opposite in fact - the more errors, the more they profit.

These companies benefit from inefficiencies and inaccuracies not going away.

SaaS subscriptions align incentives

The right SaaS subscription model aligns incentives with customers' goals. With a platform fee + volume fee vendors only succeed if they drive real, lasting cost savings and process improvements for customers.

Solving real problems with data

At Loop, we're on a mission to help businesses take control of their spend and fuel growth through proactive, sustainable cost management. We do this by solving the data problem. When it comes to payments, you typically have two siloed data sets: a purchase order and a payment order. These documents rarely match, and it takes an average of 50 days to clear a single transaction.

We unify this supply chain and spend data so that our logistics AI can execute automated audits down to a penny. Our technology-first approach allows us to serve all stakeholders in the supply chain, rather than acting as just another service provider. Legacy solutions simply aren't meeting the market's evolving needs - companies need to eliminate manual workflows and unlock the power of their data.

Our goals are our customers' goals - automating workflows, improving team decision quality, boosting carrier compliance, and ultimately reduce your cost to serve. This approach also means that we will continue to innovate in these areas. Not be stuck fixing symptoms.

With Loop, you get:

• A partner who is invested in fixing core issues, not just symptoms
• Automated audits to eliminate overpayments
• Carrier accountability to uphold their end of contracts
• Continuous improvement as discrepancies decrease over time

Simply put, we make more money by saving you more money and making your transportation spending more efficient and accurate. No games, no hidden agendas.

Volume-based pricing: a closer look

Another common pricing model in the transportation audit and pay space is volume-based pricing, where you pay a set fee per invoice or shipment processed. This can be structured as a flat rate, tiered based on shipment complexity, or a combination of the two.

While volume-based pricing may seem appealing for companies with lower shipment volumes, it's important to consider the long-term implications:

• As your business grows and shipment counts increase, costs can quickly escalate
• Complex invoices may not receive the in-depth auditing they require, as the focus is on processing volume
• There's less incentive for the service provider to proactively address root causes of invoice issues

Volume-based pricing can be appealing for companies with lower shipment volumes due to its simplicity. However, it's essential to ensure you get the accuracy, explainability, and efficiency you need. Complex invoices often lack thorough auditing, as the focus is on processing volume rather than resolving invoice issues at their source. If your team is constantly working to understand discrepancies, are you really gaining leverage? While volume-based pricing has benefits, it may not provide the same level of proactive cost management and continuous improvement as a SaaS subscription model.

The best of both worlds: Loop's hybrid pricing model

At Loop, we recognize that every business has distinct transportation spend management requirements. To address this, we provide a hybrid pricing model that merges the advantages of SaaS and volume-based pricing.

Our hybrid approach consists of:

• A base SaaS subscription fee that grants access to our logistics-AI platform, continuous support, and ongoing improvement initiatives
• A volume-based fee that adjusts according to your business, ensuring you only pay for the services you utilize and offers economies of scale as you expand

This model enables us to continually innovate on how companies can lower their costs as they grow. As your company grows BWI, our volume-based pricing guarantees that your per-shipment costs decrease, making our services even more cost-effective over time. We don't charge per invoice or document because we getting all of your data matters.

By aligning value and innovation of SaaS with the scalability of volume-based pricing, Loop's hybrid model presents the best of both worlds for shippers aiming to streamline their transportation spend.

Choosing the right pricing model for your business

When selecting a pricing model for your transportation audit and pay needs, it's crucial to consider your unique business requirements and goals. Here are some key factors to keep in mind:

• Alignment with your objectives: Look for a pricing model that aligns with your primary objectives, whether that's long-term cost reduction, process improvement, or budget predictability. A SaaS subscription model like Loop's is ideal for companies focused on continuous improvement and cost control.
• Scalability and flexibility: As your business grows and evolves, your pricing model should be able to adapt. Loop's hybrid approach offers the flexibility to scale with your business, ensuring you only pay for the services you need while benefiting from economies of scale.
• Transparency and partnership: Choose a provider that operates with transparency and acts as a true partner in your success. Beware of gain share models that may incentivize providers to maintain inefficiencies rather than solve root issues.

Ultimately, the right pricing model will depend on your specific needs and priorities. By carefully evaluating your options and partnering with a provider like Loop that aligns with your goals, you can set your business up for long-term success in transportation spend management.

Audit and Pay, reimagined for the modern supply chain

If you're tired of paying gain share fees to companies that are content with the status quo, it's time for a fresh approach. SaaS subscription audit and pay is the model of the future, and Loop is setting a new standard.

Our logistics-AI platform streamlines your supply chain from start to finish. It catches errors, automates processes, and optimizes operations. With our clear subscription pricing, you can budget with confidence while accessing top-notch audit and pay services that grow with your business. You'll also be a leader in leveraging our other logistics-AI applications to effectively manage your supply chain expenses.

Ready to take control of your transportation spend and drive real, lasting improvements? Get in touch with our team of experts today and experience the power of Loop.