Tag Archives: choosing tms

6 Quick Questions to Ask Before Buying a TMS

Choosing TMS, or a transportation management system for your company is a huge decision because there are a variety of providers and features.  A TMS helps companies move freight efficiently, reliably and at lower rates. Implementing a TMS drives value by monitoring and evaluating processes, analytics and optimization. The technology routes drivers, schedules deliveries and reports business KPIs. choosing tms

If only 35% of shippers are using transportation management systems, so choosing the right system positions you to be a market leader in logistics. These 6 questions will help you discover what kind of TMS you need.

What’s My Plan of Attack?

While choosing a TMS, it’s important to pick one that meets your immediate business needs so that implementation is successful and there is quick ROI. However, don’t ignore long-term business goals. As a shipper, consider the likelihood that you’ll eventually operate in a different region, with different modes or ship different freight. Looking toward the future is important – you’ll want your TMS to be a long-term investment, not just a short-sighted solution to save money.

What’s Important to My Business?

You’ll need a TMS with the capabilities to handle all of your freight, but you don’t want to pay for features that you don’t need. Ask yourself what functionalities a TMS must provide to improve processes. Think about if your company needs close inbound and outbound shipment visibility. Are cross-border capabilities crucial? Does the size of the carrier network matter? The answers to these questions often depend upon the provider of the TMS, but it is important to understand your business’s needs compared to the features of the TMS.

What’s the True Price of the System?

Get detailed, line by line pricing from a TMS provider. Installation, training, reports, and notifications may cost you 25 – 30% more than anticipated. You also need to know how much it will cost you to operate the TMS long-term. Are there charges for technical support, system updates and software upgrades? The cost to operate a TMS overtime may end up being more money than the original purchase price.

What Billing Capabilities Does the TMS Have?

Your TMS needs to be able to handle the different ways you bill your clients. This information is not always immediately available to a logistics or supply chain professional, but it’s worth looking into. If the TMS does not support the billing functions you need, you will be missing out on a crucial benefit of a TMS. Automated billing and administrative duties are more accurate and much faster than manual processes.

How Does the System Handle Spot Market Freight?

Scalability is a crucial feature of a TMS. You won’t always be shipping the same loads over and over, sometimes you need to send one last minute, or make an infrequent LTL move. Your TMS needs to operate within the range of freight volume you ship. Accessibility to a carrier network is a crucial feature of a TMS, not just for handling diverse and/or infrequent loads but for moving freight quickly.

How Well Can the System Integrate with Other Systems?

To get the most value out of your TMS and other internal systems, such as your ERP software, your TMS should integrate seamlessly. One of the most powerful benefits a TMS provides is visibility into logistics. Visibility is one piece of a much larger puzzle and is crucial in providing end-to-end visibility in a supply chain. End-to-end visibility may not be a priority for your organization now, but someday it will be, and then you’ll need a TMS that can support such a venture.

Choosing a TMS can be overwhelming. A TMS becomes an extension of your business – it evaluates ongoing performance metrics and enables productivity and service – so it’s important you evaluate the options and variables to make the best decision.

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3PL Technology Helps Enhance Customer Experiences

3PLs and shippers work closely to form collaborative relationships, so they produce better customer experiences for the end-consumer. The relationship between shippers, suppliers, carriers and logistics experts is important, however, it’s complex. In a 3PL-shipper relationship, 3PLs deliver shippers a competitive advantage through integrated 3PL technology.

What is the 3PL technology?

3PL technology

3PLs use a transportation management system (TMS) to support supply chain procedures and transportation choices. Also, TMS software provides visibility into the shipper’s supply chain performance through data and reports. Moreover, TMS software enables real-time, tangible information that can be analyzed to identify problems and solutions within the supply chain. Creating solutions with insight gained from TMS data often results in better customer satisfaction.

Why does customer experience matter?

Improving customer satisfaction is the key to growth. What’s more, it is predicted that by 2020, customer experience will be more important than price, so the product or brand choice as a differentiator in purchasing decisions. Having insight into TMS-produced data might be the difference between a happy or unhappy customer.

Now, nearly half of Americans pay more attention to shipping as part of the overall shopping experience, compared to three years ago. On-time, quick deliveries are a necessity for positive customer experience. Undoubtfully failed or mistimed delivery will result in poor customer experience.

The data generated from a TMS allows shippers and their logistics provider to better plan for limited capacity, changing demand, fuel costs and/or shipment size.  Also, with big data, more metrics are available to recognize customer expectations. Ultimately, the goal is to meet all expectations (from the shipper to the end-consumer). As well, TMS technology reveals the successes and failures of a supply chain.

TMS is a 3PL technology, which typically documents data for:

  • Delivery tracking
  • Status update notifications
  • Lane analysis
  • On-time performance metrics
  • Volume trends
  • Cost

Shippers benefit from 3PLs who are able to generate and analyze this big data, so they find opportunities that drive success and improve the customer experience. According to an SDL survey and Econsultancy, as many as 80% of companies plan to increase their customer experience spending in 2015. Also, companies see more value and importance in delivering superior customer experience than ever before.

Final thoughts

Trucking companies, 3PLs, and shippers face a huge challenge in creating great customer experiences due to customer demands and an increasing number of retail channels. To grow and achieve positive customer associations, companies should integrate transportation management technology to enhance its supply chain.

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