3 Key Processes Of Transportation Management System

Transportation Management Systems are really meant to increase the ROI and efficiency of your logistics company and has become a mandatory element for an effective logistics management. The transportation management system or TMS helps your make your logistics management more organized and accurate.

Transportation Management software are aimed at bringing down the time, cost and improved profit. If the time and cost taken are decreased, then there is no doubt that your profit would sour high. All you need to do is to learn to manage this amazing tool in the right way. If you are not managing TMS in the proper way then you cannot expect your business to improve.

Here I would like to talk about the 3 key processes of a transport management system, which have an influential role towards the success of your logistics business.

1) Planning and Decision Making
Planning and Decision making are the most essential parts of any successful organization and cannot be ignored at any cost. If the planning and decision making are not up to the mark, the business is sure to suffer. There have been many instances when many companies have vanished due to lack of proper planning and decision.

A transportation management solutions helps you to plan your logistics business effectively and categorize your transport schemes accordingly based on the importance as per user policy. Some of the major things that plays vital role in proper planning and decision making are transport cost, shorter lead-time, fewer stops, flows regrouping coefficient etc.

The TMS systems is also known as logistics management system and helps you to calculate your transportation cost and adjust your routes so as to experience a decrease in the transportation cost. It helps you to find out which routes yields you better profit margin and which are the stops that needs to be avoided without harming your profit ratio.

In the end the report generating facility offered by this vehicle management system helps you to analyze your logistics management in a much better way. You can even change the scheduling and routing of your vehicles for better results. The report helps you to plan better and make decisions based on that.

2) Customer follow-up
TMS helps you to experience a better customer relationship and follow up due to its enhanced features. One of the advanced feature that makes the tool stand out is the GPS vehicle tracking facility, which helps you to track your vehicle with the help of satellites. With this you would be able to inform your customers as where the vehicle is and when their goods would be delivered. It also helps in effective billing, accurate report generation, documentation etc, which makes your customers happy and satisfied.

3) Measurement
A transportation management system offers you a detailed and customized analytics report which would help you to understand your business in a much better way. The report would help you to find out the areas that needs improvements and also help where you stand when compared with the previous months. Certain reports helps you to drill down more deeper so as to get a better assessment regarding your vehicle routing software.

TL Logistics Management Software is Essential to Cutting Shipping Costs

When companies grow large enough, they typically purchase their own shipping fleet and have a logistics department that manages their shipping process from a variety of vantage points. But for small to midsize companies that don’t have a shipping fleet or an in-house logistics team, carrying out and managing their shipping process means outsourcing their transportation logistics or trying to choose the right shipping options on their own. In most cases, these companies trust a third party logistics (3PL) provider to provide the best TL shipping solutions for their unique distribution needs. However, to save money and have more control over the shipping process, more and more companies are turning to truckload logistics software-also referred to as TL logistics management software. In addition to allowing small to midsize companies to become their own logistics provider, freight logistics software helps them save money with respect to the following areas of the shipping process: freight management, transportation execution and freight payment and audit.

Freight Management

Freight management amounts to managing each means freight distribution, including but not limited to: small parcel, less than truckload (LTL), full truckload (FTL), rail and sea. While large companies employ logistics professionals or construct internal freight councils, small companies typically either outsource freight management or defer to purchasing personnel or shipping or warehouse managers. By implementing TL logistics management software, companies realize more shipping options than they do from outsourcing to a 3PL provider. Because 3PL providers only use carriers that they can make the most money with, your shipping options with 3PL providers are limited to what makes the best sense for 3PL providers and not necessarily for your company.

Transportation Execution

Traditionally, transportation systems are designed for tendering outbound shipments, meaning that they aren’t designed for managing inbound and third party shipments. In addition, parcel carriers have compliance requirements that cause shippers to use a separate system for parcel processing, leading to higher freight costs. Ultimately, shippers have a difficult time keeping their freight from being tendered outside of their original pricing agreements and end up overpaying for freight transportation. To remedy this situation, TL logistics management software allows companies to enforce internal and external compliance throughout the shipping process with regard to the carrier pricing agreement.

Freight Payment and Audit

TL logistics management software allows you to combine your freight payment and pre-audit data, which gives you limitless reporting options concerning your freight spend. With the combined information uploaded to the software application’s dashboard to give you almost real time visibility of your freight spend, you can to monitor freight KPI’s on a daily basis to further control shipping costs as KPI’s change. The freight payment and auditing capabilities of truckload logistics software also allow you to receive more of your freight bills through EDI, which serves to lower your pre-audit costs.

Six Benefits of Implementing a Software-Based Logistics Management Program

A logistics management program-also referred to as a transportation management program-is a comprehensive approach to managing every aspect of the logistics process while developing innovative shipping solutions that save time and money wherever possible. A logistics management program is achieved in one of three ways: hiring a team of in house logistics experts, hiring a third party logistics (3PL) provider or implementing third party logistics software.

Hiring a team of experts is usually too costly for small to midsized companies, and hiring the type of 3PL provider that would implement a comprehensive, innovative logistics management program is usually too costly as well. But implementing logistics software allows companies to develop a comprehensive, innovative management program without the aid of paid professionals. Logistics software does the work of a logistics expert, meaning that its users don’t need to possess logistics expertise. Instead, they use a user-friendly interface to choose from among recommended shipping solutions for every area of the shipping process. Below, we list six benefits that shippers experience after implementing logistics software.

Reduction of Expedited Order Costs

Expedited shipments can significantly drive up the cost of shipping if they occur on a regular basis; and without a comprehensive logistics solution, they typically do. Logistics-software allows shippers to reduce expedited shipments through better shipment planning and system directed exceptions handling, which resolves exceptions before they necessitate an expedited shipment.

Increase of Load Consolidation

Upon implementing logistics-software, shippers immediately realize the ability to consolidate parcel shipments into less than truckload (LTL) shipments, as well the ability to consolidate LTL shipments into truckload (TL) shipments, each of which significantly lessens annual shipping costs.

Automation of Carrier and Mode Selection

When companies automate the selection of the best carrier and the best shipping mode, they save money in terms of both saved time and saved manpower, especially considering that logistics software immediately pairs optimal carrier and optimal mode selection.

Identification of Invoice Discrepancies

Searching for discrepancies in invoices on your own can be tedious and time consuming. But logistics software can instantly compare the audit of a freight invoice against the shipping contract, allowing you to never pay for services that weren’t rendered as promised or that were rendered in violation of the shipping contract.

Tracking of Carrier Performance

Tracking a carrier’s performance can help you negotiate better rates. Logistics software provides information on a carrier prior to your forming a contract with them, which can allow you to receive a lower rate if, for example, a carrier’s promised delivery times average a few minutes or more less than the promised times.

Reduction of Product Breakage

Regardless of the cost effectiveness of shipping routes and load arrangements, a company doesn’t profit from an economical shipping process if its products regularly break en route. Logistics software solves this problem by connecting shippers with carriers that offer the right mixing and stacking strategies for a particular type of freight.

Amateurs Study Shipping Rates, Professionals Study Logistics

Omar Bradley offered a truism, that amateurs study tactics, armchair generals study strategy, and professionals study logistics. This is just as true in the world of business as it is in the military. Logistics is the art of getting supplies where they’re needed so other functions can happen. In the modern business world, logistics means freight shipping – both internally and externally. In this field, freight rates and carrier rates are the price of doing business.

Freight shipping is one of those expenses that can be minimized, but never totally eliminated. It’s also a manpower time sink, and because of this, more and more companies are outsourcing their freight needs to third party logistics companies. These are outfits that have people who do nothing but look over the assorted rates and package deals offered by the major freight carriers and try to find the best deal possible for their client, with a nice commission on top for them.

All in all, third party logistics management makes sense for organizations that are above a certain size (too small, and they don’t generate enough volume to be worth the trouble of maintaining the account) and below a certain size (at which point the company can have an inside staff that does the same function for less).

Alternatives to third party logistics offers are in house logistics software. Much the same way that travel agencies quickly became redundant with online booking services, logistics software vendors are trying to render the third party logistics company obsolete. Building automatic data scrapers that can do the basic work of comparing logistics rates to different parts of the country or world is fairly straightforward, as is a price search algorithm.

While these systems primarily offer a way to avoid third party logistics fees, they also offer a bit more direct control over your company’s shipping needs, and some managers and executives like that hands on feel. They can also be used to significantly automate a lot of routine functions in the shipping department and the mail room. They can also be used to identify process problems – there’s a saying that every time something was sent out overnight, someone higher up in the chain didn’t do their job correctly, and when you’re looking directly at the costs of expedited shipping, it becomes easier to focus on the process issues that lead to it, than when you’re looking at a third party statement of account.

Ultimately, which one works best is a function of your business’ needs and internal culture; some businesses simply don’t want to bring that job in house. Others need to. Both are viable strategies depending on what your operation’s needs truly are.