A transport management system, or TMS, is a comprehensive supply chain system designed to streamline the transportation process. TMSs can be used to track and optimize shipping costs by shippers. A TMS can also be utilized by: small and large companies. A transport management system is also commonly referred to as a third-party logistics provider (TPL).
An efficient transport management system will ensure that the entire process is streamlined and optimized. It will bring together all parties involved in a transaction at every stage to ensure accurate and up-to-date information. The final result is a simplified, unified system that facilitates communication at all stages. There are several elements of a good TMS. They include the following:
Real time dispatch. There should be a capability to view and manage multiple carriers using a single interface. This will enable a business to have access to the best available carriers at any given time. Using this feature, a business can quickly analyze the routing options available and determine the best carriers for shipment accordingly.
Integrated logistics planning. A company will have one central location to view all data and plan their logistics. You can track every stage of a transport, including pick-up and destination locations. This enables a business to optimize fuel savings and transportation costs. The use of multiple carriers should improve logistics efficiencies, as well as improve customer service.
Route management. A transport management system should allow for the routing of every type of truck. Multiple trucks with different loads should have the ability to be linked to different destinations. To maximize efficiency and avoid trips across states or countries, two trucks carrying different loads of aluminum cans can be routed together.
Core Features. Although a transportation management system should offer many core features, there are certain core features that should be present in every system. These core features include the ability analyze routing information, integrate multiple carrier into one system, analyze and improve route planning, and improve logistics management. A company can track their inventory and commodity loads to make better decisions and reduce costs. Improving logistics management also allows a company to improve their customer service. Both logistics managers and supply chain managers rely on accurate and timely information to support decisions.
Reduce Costs. Managing the supply chain is an extremely complex endeavor. It takes a lot of time and effort to monitor goods flow and identify the best delivery routes. A logistics manager who fails to identify the best routes could miss opportunities to save money on transportation costs. A transport management system should be able to cut routes that have the highest costs, improve overall efficiency, and reduce costs due to delays and delivery cancellations.
Increase customer satisfaction. When customers are satisfied with their products and services, they will keep returning to a company. Metrics can be used to determine how well transportation management systems are meeting their needs. If customer satisfaction metrics show that they are not being met, it might be time for a company's approach to customer satisfaction to change. This could include new training programs, rethinking marketing messages to customers and other options that may be more effective for the company.