Good supply chain visibility has become an industry standard for shippers of all sizes. At any given time, shippers and receivers expect to be able to locate freight. A transportation management system (TMS) makes it possible.
What is a transportation management system? A TMS is a technology platform that enables the planning and execution of the transportation of freight. Because they automate so many logistical processes, transportation management systems have become invaluable tools for shippers and third-party logistics providers.
Who Uses Transportation Management Systems and Why?
A wide variety of businesses use transportation management systems. Essentially, anyone who moves freight needs a way to manage the logistics. This can include manufacturers, distributors, e-commerce and retail businesses, and third-party logistics companies. A TMS can help with everything from generating quotes to routing deliveries. Moreover, it can do so quickly and efficiently.
Transportation management systems connect every part of the process of moving freight. Carriers even use a TMS for procurement. These platforms create optimized shipping routes that can save shippers time and money by taking a large number of factors into account using machine learning. Machine learning and artificial intelligence in transportation management systems also improve carriers’ on-time in-full deliveries with improved logistics.
One of the most important uses of transportation management systems is increasing visibility across the board. A TMS provides real-time visibility on trucks and freight. Improved ETAs and visibility help carriers meet delivery windows, and shippers can provide better customer service to expectant receivers.
The Difference a Transportation Management System Can Make
Transportation management systems provide an array of benefits for shippers and third-party logistics providers. All of these benefits lead to better supply chain management and happier customers.
Saving Time and Money
Transportation management systems have a proven track record of cost savings and increased time efficiency. Freight savings come in the form of load consolidation and multi-stop route optimization, among other strategies. Since the cost of shipping continues to grow year over year, a good TMS can make a big difference.
A transportation management system saves time by reducing the number of manual operations involved in freight operations. Because a TMS automates so many processes, it can reduce delays and speed up delivery times.
The reports pulled from a TMS enable improved processes in the future as well. Companies can identify where delays happen most often and improve systems in response. As a result, delivery times and customer satisfaction improve.
The importance of a TMS in increasing supply chain visibility cannot be overstated. From a shipper’s perspective, visibility enables them to mitigate disruptions and respond quickly when they do occur. In today’s landscape, this is vital. Visibility also helps with forecasting changes that will need to be made in the future.
Excellent visibility matters to customers too. The explosion of e-commerce and rapid delivery means that customers have become accustomed to accessing the location of their purchases from the moment they place their purchase to its arrival on their doorstep. Real-time updates reassure customers that freight is secure and that their orders are being delivered in an efficient manner.
Common TMS Questions
As important logistics tools, transportation management systems affect many aspects of a business. These are some common questions that arise.
What is the role of a TMS in the big picture of supply chain management?
Supply chain management is a complicated field. A transportation management system is just one tool that drives efficiency and visibility, but it is a critical one for shippers to adopt in order to manage transportation logistics.
What’s the difference between a TMS, WMS, and an ERP?
Like a transportation management system, a warehouse management system (WMS) is a software system for logistical planning and execution. A TMS enables shippers to track freight in transit, while they use a WMS to manage inventory and run warehouse operations.
A comprehensive TMS will integrate with a WMS. For example, First Call Logistics uses a transportation management system that integrates with its warehouse management system to improve visibility and efficiency.
An Enterprise Resource Planning (ERP) software system can likewise integrate with a TMS and WMS. Shippers use an ERP to manage day-to-day operations, including supply chain management.
Will Transportation Management Systems (TMS) continue to matter for logistics in the future?
According to a 2021 study by Forbes, the TMS market skyrocketed during the pandemic with no signs of slowing down. Transportation management systems have a great ROI. Shippers and third-party logistics companies (3PLs) will continue to depend on this technology to improve visibility and sustainability post-pandemic.
What’s next for TMS software?
The supply chain is growing ever more complex as globalization increases. Transportation management systems need to be up to this global scale of operations. They also likely will include more features to navigate complex regulatory landscapes. Most importantly, in a world where customers expect two-day deliveries and end-to-end visibility, TMS platforms will continue to be integrated with other supply chain management and customer service software.
Arm Your Supply Chain with Best-in-Class Technology Today
At First Call Logistics, we understand that each business’ supply chain has unique needs. Our best-in-class technology seamlessly integrates with industry-leading transportation and logistics ecosystems for advanced visibility, stronger collaboration, and improved business continuity. To learn how you can leverage First Call’s robust suite of technology to optimize resources, minimize costs, and provide better customer service, contact us today.