While operating in a progressively complex logistics world, companies in this day and age need all the help they can get to help them work smarter, easier and more efficiently. Customers are becoming increasingly more demanding, and the need for more improved supply chain visibility continues to pose a challenge for companies. Technology like Transportation Management Systems (TMS) is now more important than ever. The TMS plays a crucial role in helping shippers overcome these challenges and thrive in the increasingly competitive logistics industry.
Since more and more additions to TMS are continuously being tested for the future, it is important that your business isn’t left behind. Here are some reasons we believe investing in a TMS could be beneficial to your supply chain.
What is TMS?
A transportation management system (TMS) is a subset of supply chain management (SCM) that deals with the planning, execution, and optimization of the physical movements of goods. In simpler terms, it’s a logistics platform that enables users to manage and optimize the daily operations of their transportation fleets.
The Value of TMS for Supply Chain Management
A TMS helps shippers move loads from point A to point B in the most cost-effective and rational ways possible. Hiccups – such as empty return trailers or half-loaded containers – can be avoided by using a TMS’ technology, which analyzes and identifies the best possible situations and sends that information to dispatchers automatically. Traditional tools such as phone calls, paper, and fax machines have become virtually obsolete.
Some additional advantages that a TMS provides include:
- Improved supply chain analytics
- Carrier selection based on transit times, shipping costs, etc.
- Better warehouse efficiencies
- Decreased data entry errors – less wasted time fixing mistakes
- Combine it with a Warehouse Management System (WMS) to achieve more supply chain visibility
- Reduced inventory and greater confidence with customer tracking
- Enterprise Resource Planning (ERP) integration to minimize manual data input
Most users primarily rely on a TMS to lower their freight costs. However, there are many other benefits. For example, a TMS’ report and analytics program can identify if the lowest-cost carrier is really delivering on time – all the time. If not, the shipper could be wasting time, money and resources, which cancels out any chance of any savings on rates. So, less employee time spent on transportation management translates to more time spent on other issues.
A smart supply chain manager will do everything they can to make sure there are optimal visibility and communication among all pieces to this puzzle. A TMS allows you to increase margins while maintaining quality, providing a tool that coordinates and maximizes your chain output and efficiency.