A TMS (Transportation Management Software) is software designed for companies to keep track of supply chain systems that automates the transportation management of an organization. In other words, a TMS will not only take care of the transportation and supply chain system, but it will also be in charge of keeping track of administrative tasks, proper documentation, and historic data to keep your company operations up to date.
What is a TMS and why should Shippers use it?
As we have said before, a TMS is a software program or digital tool that companies often use to coordinate and manage their transportation and logistics needs.
There’s no way around it: implementing a TMS is an investment in your business. While some shippers assume that TMS solutions are costly or time-consuming to understand, the fact is that they have never been simpler or more accessible. There are many advantages to investing in a comprehensive transportation management framework for a shipper.
Transportation management made easy
The TMS is a platform that serves as a base for a number of other subsystems. Customer relationship management, supplier relationship management systems, route planning, ratings, and monitoring are all possible with today’s TMS. This gives you full control over your shipping operations in one place.
Inventory Management and Supply Chain optimization
A TMS also gives shippers more control over the monitoring and tracking of freight during its lifecycle. It can also track freight from picking to packaging to pick-up, as well as each movement or scan, all the way to delivery. Users may also set up contact preferences, allowing them to send reminders to customers on when their orders are scheduled to arrive.
Freight bill auditing is one of the most valuable features of a TMS. Users should check their invoices and compare them to agreed rates for items like fuel surcharges, weight billing, and more. It also helps the consumer to look for clerical errors in individual pieces of bills of lading and other freight invoices. The modern TMS, like any other Software as a Service (SaaS), can be customized and extended to meet the needs of each individual user. TMS solutions have also been used and created by third-party logistics companies since their inception. They are familiar with all of the complexities, bells, and whistles, as well as the special features and advantages they offer.
Use a Transportation Management System for customer control
Using a TMS, you’ll have the option to save your customers’ billing information into a database. Billing every month is just a piece of cake. With only a few clicks, all your billing process will be done in half the time it might take you if you would be doing it manually. In case you need it, you can also set reminders and notes for some particular invoices.
Since you will automatically be generating online invoices for all of your clients, you will be saving a lot of time and money by concentrating everything in one single place. Just make sure that the TMS you choose already includes the latest tax updates for all the countries you work with.
Transportation management systems also concentrate data history for every single client, keeping better control of expenses, balances, and incomes.
All these files are created easily and very quickly, as they have preloaded information and allow information to be consulted in one place.
Use a TMS for better KPI’s and decision making
When a business begins to grow, it faces the need for better and accurate information for decision-making. If this information does not exist or is not accurate, it can damage the future of the company in the long run.
Now, imagine that from your office, your home, or anywhere from your cell phone, you can access the Internet, open your account, and check billing income, operating expenses, fuel consumption, and non-trip units, among other important supply chain indicators or KPIs.
This will be possible if you use a TMS that is in the cloud, so you can carry your business as a shipper everywhere you go. With information always updated and at first hand, you forget about the operation and focus on what is important: making your business more productive and profitable.
The TMS is offered as a module within enterprise resource planning (ERP) and SCM (supply chain management) plans and helps organizations move inbound and outbound purchases using tools such as route planning and optimization, construction of cargo, execution of operations, audit, and payment of cargo, visibility of orders and management of drivers.
The ultimate goals of using a TMS are to improve shipping efficiency, reduce costs, gain real-time supply chain visibility, and improve customer service.
Transportation management systems have gained traction over the past decade as they has emerged as an enabler of global trade and logistics management. By allowing the exchange of information through functional repositories, amid geographically separate operations, and in multiple languages, currencies, and business units, it has become business software that is gaining in popularity. Also, its functionalities make it suitable for organizations that not only have complex logistics operations, but also those that may have basic transportation needs.
TMS handles four major transportation management operations:
Planning: Define the best transportation strategies based on specific parameters that would be of greater or lesser importance, depending on the user’s policy. This includes transport costs, minimum possible stops to guarantee the quality, shorter delivery time, flow regrouping coefficient, etc.
Transport execution: allows the execution of the transport plan. This includes carrier rate approval, carrier shipment, electronic data exchange, efficient management system, and more.
Transport monitoring: allows the monitoring of any administrative or physical operation related to transport. This includes event-by-event transportation traceability, receipt editing, customs clearance, billing, as well as document reservation, delivery of transportation alerts, and more.
Measurement: includes or should include a reporting functionality of the strategic key performance indicator for transportation and supply chain control.
The main benefits of using a Transportation Management Software as a Shipper
A TMS is a great investment for any freight shipper. Although you must invest some financial resources to get the system up and running, the rewards far outweigh the disadvantages.
A fully implemented transportation management system can benefit shippers in the following ways:
- Supply chain visibility and better inventory management control: TMS enables users to track and monitor the current status of orders and shipments in real-time and get status updates on each. This gives users an accurate forecast for inventory and improves visibility and accountability of the supply chain network.
- Reduce invoice errors: By automating freight payment and auditing processes, users can reduce errors that may arise from manual procedures.
- Transportation intelligence: most TMS software offers users detailed information and reporting capabilities that provide detailed visibility into data and load metrics to help identify any discrepancies. With this information, users can make the necessary changes to improve service delivery and reduce costs, and they can also create reports.
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