A Transportation Management System, or TMS, is a service that connects and integrates several parties engaged in the supply chain, such as manufacturers, distributors, and third-party logistics providers, to help manage a supply chain workflow in planning and executing the physical movement of goods.
The logistics software industry is expected to reach 1.7 billion dollars by 2022, according to Gartner Group. As a result, by implementing TMS software now and optimizing supply chain processes for your company, you will reap the benefits of saving up to 10% on delivery costs. Beyond that, by leveraging your transportation management workflow you can evaluate critical business indicators including class and weight breakdowns, cargo density heat maps, cost-per-ton, and cost-per-mile metrics, carrier saturation reports, efficiency reports, and real-time performance.
A TMS, which oversees the whole shipment process, gathers data about items in real-time via API or EDI technology, providing its users (including freight forwarders, shippers, related third-party) with important information from manufacturers to distribution centers, delivery, and customers. This information may then be used to create analytics on your supply chain, financial status, and customer service difficulties. Generally, the transportation management workflow is capable of handling parcel tracking, freight shipping, and supply chain audit as crucial components of the process.
TMS software benefits
Considering the complexity of today’s transportation and logistics, the implementation of TMS software is required, to optimize supply chain processes and make freight shipping more efficient. TMS workflow facilitates the detection and reduction of client expenses, as well as discover any inefficiencies in freight forwarders’ business processes. Any firm with direct responsibility for delivering a large volume of products or employing service providers to execute the work needs a TMS. Therefore, below you will find the main advantages of the TMS application.
A transportation management system can pave the path for the most efficient use of resources in a variety of ways: browsing around for the greatest deals for savings, optimizing routes and load-balancing, real-time analytics and precise information about your fleet, automating labor-intensive processes, and harmonized transportation and fulfillment tasks.
Simplified transportation process
TMS enables to oversee the fleet in real-time. You can view each driver’s exact location on a GPS-enabled map, as well as the routes they’ve traveled, delivery locations, and other helpful information. With complete insight into your fleet, you can manage it more effectively, which boosts productivity. Driver tracking aids in the optimization of routes and the creation of more efficient timetables. You may also find available drivers and give tasks to them.
TMS software allows you to follow your shipment’s progress by air, sea, or land, as well as respond to any transit issues, unexpected delays, and more, all from a single place. Every detail about a specific order and its delivery is recorded and saved by a TMS platform. They offer effective reporting capabilities that provide users with critical analytical data and insights. This is extremely beneficial throughout any decision-making process, as it enables company executives to make good judgments while having instant access to a large amount of data.
Enhancing Warehouse Quality
You can generate accurate projections based on a wide range of data with TMS, which improves the transparency of your supply chain network. You may have a well-organized warehouse with the help of a TMS. It makes inventory management and monitoring of items easier. You always know where your freight is, whether it’s in transit or at the warehouse. As a consequence, you will be able to increase the efficiency of your procedures.
Transportation Management System Functions
Building the Supply Chain process using TMS, it’s important to take into account the development of multiple interfaces with various features for each user group. For instance, shippers and distributors would mainly need electronic data interchange (EDI) solutions, bookings and tenders control, shipping rate, and real-time tracking features. Meanwhile, for third-party logistics providers (3PLs) and vendors, it’s more crucial to have an access to generate customs documentation and track the declaration process. There are also could be special Transportation Management System functions like automatic shipment planning, submitting and invoicing for transport requests, or customer despatch tracking for drivers’ apps.
Generally, all functional capacities of your TMS depend on the expansion level of the desired platform. Despite TMS has several advanced data collecting tools, as well as the ability to use the data to create efficient reports that assist management, there are basic Transportation Management System functions divided by few scopes: Freight regulation, Parcel tracking, Shipping administration, and Order management. Here, we examined all of those features to make your experience with TMS exploration more convenient.
Logistics and supply chain firms place a high priority on freight management. Through technology like TMS, freight saves wastage, needless expenditures, and speeds up your entire business. Users can utilize TMS software to organize shipments with carriers. It is feasible to track shipments and exchange information with customers and suppliers thanks to real-time insight into freight movement throughout the transportation network. Additionally, there are communication systems for contacting transit drivers as well as GPS functions. TMS can also collect real-time updated rates from several carriers for simple comparison. Without having to phone several TMS providers, you can negotiate and manage pricing from a single interface. To simplify and make safer shipping processes, there are plug-ins such as EnviaYa that could be installed to handle order management.
Freight regulation features can help you with the planning of the trucks’ loading space and get a computation of the available ones, taking maximum loads and weight into account. For example, master data allows you to enter information about your car dimensions and preserve it for future reference (the dimensions of the item could be taken from the freight order).
Parcel tracking and routing
With TMS, tracking execution becomes simple. It allows to make real-time bookings and conduct critical freight management activities. The TMS software also provides you with real-time insight and the ability to trace your products at any moment. For scheduling and handling routing difficulties, creates a necessity to utilize a mix of routing tools that extract a large amount of data from TMS, which can then be used to assess route performance.
Track and trace technology allows you to track the parcel in real-time during transit. This means you won’t have to contact the driver to find out where the truck is, and you’ll be able to see it at all times. Telecommunication systems such as GSM, GPRS, or UMTS connect a device in a truck or a driver’s smartphone to the TMS. Barcodes or RFID tags can also be used to track consignments, pallets, or crates (a TMS receives an update on its position every time it is scanned). But implementation of such features requires the additional application of asset tracking technologies, to cater effective parcel tracking in TMS.