How Can a TMS Streamline and Optimize Your Transportation Operations?


How Can a TMS Streamline and Optimize Your Transportation Operations?

The rise of eCommerce, rapid delivery systems, and cross-border commerce have increased the demand for reliable, efficient, and time-critical transportation. Recent research reveals that the global transportation and logistics services market is expected to hit the USD 1,804.49 billion mark by 2029.

However, as businesses zoom out on supply chain sustainability and intelligent fulfillment, they are actively seeking ways to monitor shipment movements in real-time and identify as well as manage disruptions. This is driving huge demand for robust and intelligent transportation management systems (TMS), and the global TMS market is expected to reach USD 11,367 million by 2027.

How can a TMS solution help businesses streamline and optimize their logistics operations, and what are the major benefits it offers? What are some of the key considerations for choosing the right TMS and how to identify the right product for business-unique use cases? Here, we explore the answers to these and many other questions.

What Is a Transportation Management System (TMS)? 

A Transportation Management Solution (TMS), is an automated software platform that offers a dashboard interface to manage, monitor, track, and control transportation assets, partners, and operations. The software helps businesses to work with their transportation partners in an easy manner and allot shipments to multiple carriers in an optimal way. 

Businesses can get all sorts of shipment information, such as tracking, key milestones, and expected delivery dates, in one place and can automate financial operations. The platform helps in multiple crucial tasks, such as load planning, procurement and management of market vehicles, billing, invoicing, indent management, and more.

How Does a Transportation Management System Work?

A Transportation Management System (TMS) comes with multiple functionalities that enable businesses to gain visibility over the transportation process of their service providers, right from inbound logistics to last mile delivery. Businesses can check the market vehicles that are available, compare the prices, services, and delivery SLAs, book the market vehicles, and track the shipment in real-time.

While the vehicle is in movement, they can ensure that the fuel expenses stay optimal by leveraging the TMS for route optimization. Advanced functionalities, such as SIM-based tracking, allow businesses to track asset movements in real-time, which improves visibility as well as ensures efficient monitoring.

Further, a TMS allows businesses to partner or work with multiple carrier and logistics service providers,a and set specific rules for vendor selection based on shipment characteristics, delivery requirements, service agreements, costs, volume, etc. 

All these factors help reduce the overall cost significantly and enable businesses to overcome the reliance on manual elements, such as communication for shipment tracking, individual carrier calls, inefficient load mapping, etc. 

Major Challenges in Transportation Management

Challenges in manual transportation management

Lack of Operational Visibility and Manual Shipment Tracking

Due to multiple transportation parties, businesses often lack complete visibility over shipment movements. So, communication and coordination happen via individual calls, texts, emails, chats, etc. This spawns confusion and discrepancies, especially in enterprise ecosystems where thousands of shipments are in transit for and from multiple locations.

As businesses have no direct view over shipment or vehicle movements, they are unable to track the shipments, which affects the end-customer experience as well as leads to inefficiencies. The situation worsens for international shipments, where tracking requires multiple calls and individual searches across multiple websites, which might not offer the latest information.

Poor Vendor Management

In a manually-managed system, working with multiple logistics partners is extremely difficult as it creates multiple operational silos. Businesses are unable to coordinate with multiple vendors, and even if they do, they end up switching among multiple software interfaces for transportation management. Further, the inability to have multiple vendors restricts them from having the upper hand in negotiations and cost-efficient vehicle procurement. 

Manual Load Planning 

Manual load planning is neither optimal nor efficient. Managers allocate orders to drivers based on elementary selection criteria, such as availability, contracts, cost, volume commitments, etc. This can easily increase the number of Partial Truckloads (PTL), which could have been easily clubbed to reduce shipping costs and increase resource utilization. 

Inability to Set and Measure Performance Metrics 

Manually-managed transportation ecosystem is riddled with inefficiencies as the managers have no reliable way to measure the driver performance, carrier’s adherence to service level agreements (SLAs), and overall customer feedback. 

Setting and measuring KPIs for performance evaluation and customer satisfaction requires intelligent solutions that can help measure the performance metrics and offer actionable insights.

Now that we have had a look at the various challenges in transportation management let us move on to explore the core offerings of a transportation management system and how it overcomes these challenges.

Core Features of a TMS and How They Help Manage Transportation

Core features of a transportation management system

In-Built Route Optimizer

Smart transportation management systems come with an in-built route optimizer that creates highly optimized routes for all the shipments based on multiple configurable parameters, such as consignments, delivery location, delivery date, etc. The system-generated routes are displayed over the driver apps, and drivers can easily follow them to complete the timely delivery of goods. 

In-built route optimizers help overcome routing inefficiencies and trap fraudulent driver activities, such as idling, empty miles, etc. Thus, businesses can ensure highly efficient logistical movements and reduce their fuel costs, vehicle leasing costs, overall time for logistical movements, etc. 

Real-Time Shipment Tracking 

Real-time shipment tracking gives businesses a bird’s eye view of all the shipments and assets in transit. The real-time tracking also ensures highly reliable and real-time visibility over the transportation process, such as key milestones, which can be shared with multiple parties automatically. 

Businesses can easily track all the shipments via a single dashboard, which overcomes the need for individual tracking/communication with multiple people for shipment movements. Further, having real-time tracking capabilities also prevents inefficiencies due to faulty driver behavior.

Vendor Management Portal

Intelligent TMS solutions come with integrated vendor portals for efficient and effortless vendor management. Businesses can easily partner with the built-in vendors, check the available market vehicles and their costs, compare multiple vendors, and communicate with each of them in a seamless manner.  Creating and managing indents for transportation becomes easier, and businesses can easily onboard new vendors for profitable business operations.

Automatic Load Planning and Pairing

TMS solutions come with in-built algorithms to match every load/shipment with the right carrier and vehicle based on specific constraints, such as delivery location, consignment size/volume, cost of transportation, and more. This takes the guesswork out of the picture, as businesses can simply choose the consignments and get a highly optimized selection of vehicles.

Automatic load planning and pairing help reduce transportation costs by maximizing vehicle capacity utilization and mapping the consignment with the most optimal vehicle. This also reduces the need for market vehicles for PTL shipments and facilitates the clubbing of shipments.

Performance Evaluation and Analysis

As the TMS solution comes with an integrated vendor portal, where all the vendor, shipment and serviceability details are recorded, it becomes easier to set performance evaluation metrics and measure them. They come with an in-built module for KPI benchmarking and enable businesses to measure the performance of individual partner.

This performance analysis helps in choosing the best transportation partner for future consignments and helps improve productivity as well.

Unified Communication and Collaboration

TMS solutions integrate disparate systems, namely – businesses, end customers, transportation partners, and drivers. Thus, all the information regarding finances, shipping operations, shipments, etc., can be found and shared easily across relevant stakeholders as and when required.

Managers can easily check which shipments are in transit with which carriers, vehicles, the expected arrival times, and much more in one place. This information is highly reliable and can be easily shared with the end customers as well. This also helps reduce the customer query calls for shipment status checks and elevates customer experience as well. 

Data Analytics and Reporting

AI-powered Transportation Management System comes with in-built data analytics and reporting capabilities that help businesses make the most of their operational and organizational data. They can check the hidden trends, such as number of delayed deliveries per carrier, wrong deliveries, cost per shipment, and more.

The in-built reporting capabilities help generate highly consumable reports that can be shared and exported in multiple formats for strategic business decision-making. This reduces the need for third-party data analytics and reporting and also reduces business costs by serving actionable insights to CXOs.

Customer Feedback Management

Advanced Transportation Management Systems come with dedicated modules for customer feedback management, where the customers can submit feedback via multiple channels for different things. For instance, they will get prompts for submitting feedback for successful, failed, and delayed deliveries, which helps businesses identify hidden optimization pockets.

Allowing customers to share their feedback for delayed/wrong or damaged deliveries gives visibility over the last mile services of a transportation partner and helps prevent the degradation of customer experience. 

Proof of Delivery (PoD) and Non-Delivery Report (NDR) Management 

TMS solutions come with the functionality where the drivers/delivery executives, as well as the end customers, can attach the graphic (images and videos) proofs of delivery. This can be a photo of the delivered consignment, a photo of the customer’s location, etc. 

This automates customer feedback and helps manage faulty driver behavior, such as fake delivery attempts, wrong delivery, etc. The customers can also share their feedback for non-delivery via direct links that can be shared via preferred communication channels.  Likewise, the drivers/delivery executives can also share the reasons for non-delivery from the available list of reasons, and only then are they allowed to proceed with the next task in the rider apps.

Choose Shipsy – AI-Powered TMS With Versatile in-Built Functionalities

Shipsy’s advanced Transportation Management System (TMS) comes with all the above-mentioned features as well as multiple other functionalities that help businesses manage, control, and improve their transportation management in a better manner. It offers intelligent vendor selection and vendor prioritization modules, which automatically suggest the most optimal vendors for specific consignments based on the parameters chosen by the businesses. 

It also comes with in-built transportation rates masters, cost calculators, and serviceability masters that help automate vendor comparisons based on multiple factors, such as contracts, transportation costs, and shipping services, such as express deliveries, planned deliveries, overseas deliveries, etc. 

Businesses also get an in-built indent management portal for creating and managing indents. They can get automated invoice and billing management modules that can automate bulk invoice generation, as well as make transactions more reliable, transparent, and credible. Finally, businesses can get a highly configurable route optimization and planning module that creates optimal routes and helps reduce transportation costs by a significant measure and unlock advantages, such as:

  • 14% Decrease in overall transportation cost
  • 20% Decrease in average delivery time
  • 40% Decrease in market vehicle requirements

For more information or to get a hands-on view of Shipsy’s advanced TMS in action, please get in touch with our experts for a personalized demo today.

Frequently Asked Questions

What is optimization in transportation?

Optimizing transportation means maximizing efficiency, reducing costs, and enhancing overall performance within the transportation network. 

What is the importance of transportation optimization?

Transportation optimization enhances efficiency, cuts costs, and ensures timely deliveries. It maximizes resource utilization, minimizes fuel consumption, and boosts overall supply chain performance, contributing to improved customer satisfaction and profitability.

How do you optimize logistics operations?

You can optimize logistics via smart software like a TMS that comes with advanced functionalities, such as route optimization, real-time tracking, warehouse integration, carrier selection, etc.


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