Case Studies

There’s opportunity for recovery and process improvements within many different contract areas of your business. These case studies illustrate the actual benefits Connolly delivers to its clients.

Audit of freight charge mark-ups results in recoveries of over $1 million

Audit:  Cost plus contract for packaging supplier

Discovery:  Supplier incorrectly added profit mark-up to freight charges

Focus:  Reviewed all aspects of actual cost roll-ups

What We Did:  Reviewed freight charges from a packaging supplier using various freight carriers. This cost item was to be handled as a direct pass through with no profit margin added, however our review uncovered routine mark-up on all non-UPS and non-USPS freight charges.

Value:  Connolly developed an understanding of overall freight charges assessed, then applied calculations to arrive at the amount of additional profits being earned by supplier at our client’s expense, resulting in recovery claims in excess of $1 million.

Recommendation:  Connolly recommended contract language be written to support the position that freight is typically billed as a direct cost pass through, with no additional profit margin added. Freight charges should be itemized as a separate charge on all billings for transparency.