Top 3 Benefits of Using a TMS System for Supply Chain Optimization
Routing and planning Less than truckload or LTL shipping is a daily struggle for several shippers. Companies focusing on manufacturing, distribution, or retail operations typically utilize LTL carriers to move partial or multiple shipments of pallets to multiple customers in several geographic regions. While some shippers have created fairly efficient methods of routing, planning, rating, and hiring carriers with the assistance of their employees, many have taken a technological approach by depending on a TMS system to accomplish this task.
Whether you’re an LTL shipping novice or a seasoned professional looking to improve the efficiency of your LTL operations, a transportation management software system can significantly help. In this blog we’ll introduce you to TMS systems, what they are, how they work, and three of the top benefits that a TMS platform can offer shippers in any industry.
Explaining the Ins and Outs of a TMS System
The TMS system is a cloud-based Software as a Service (SaaS) that help shippers and leading LTL carriers connect. The system itself is scalable and can be configured with tools that help a shipper receive shipping estimates, find qualified carriers, improve route optimization, and even connect with customers or audit freight invoices. While the systems are customized for each industry, there are 3 main reason why shippers rely on TMS solutions to power the daily operations. Let’s explore the top 3 benefits of a TMS system for shippers.
First – They’re 100% Scalable
Flexibility is the name of the game in logistics. For those integrating new programs or software into their LTL route planning operations, having the freedom to expand the platform as they grow is more than just a luxury – it’s a necessity. A TMS system is essentially an automatic data collection and organizational tool that is accessed via a dashboard that is customizable to fit the needs and preferences of each user. As the shipper becomes more comfortable and wishes to expand their TMS -it’s a snap.
Second – It Improves LTL Costs
Shippers depend on TMS systems to find carriers that can move their products to customers in different locations across the country. However, some carriers are simply better than others – and in some cases, can save you money that goes beyond the simple cost of movement. Case in point – let’s say for the sake of argument that you hire carrier “A” to move three pallets to customer “A” with a flat rate of $500. Carrier “A” attempts to deliver the shipment but is unable due to being late to the shippers receiving hours. In the end, the shipment arrives two days after scheduled, and you receive a final invoice of $750 with an extra $250 delivery surcharge for a reattempt.
Now, let’s say you hire carrier “B” with a flat rate of $600 who delivers on time. While the initial cost is slightly higher, in the end, not only are you able to save $150 on the total cost, but you have a happier customer who is more likely to purchase your products in the future. A robust TMS allows shippers to find carriers that can transport shipments that require special handlings, such as refer, secured shipment, or other unique shipment types. Once the right LTL carrier has been found, the TMS permits the shipment to be tracked, with instant notifications being sent to all parties within the movement of that freight.
Finally – You Can’t Put a Value on Delivering Superior Customer Service
The quick and accurate flow of information is an important customer service attribute. Whether it’s receiving updates on an overnight shipment, or notifications of a delay of an LTL delivery, today’s consumer depends on effective communication to plan their days and operate their businesses. A TMS service can be configured with consumer-friendly communication tools such as SMS text messages, emails, even desktop or laptop device notifications. Automated phone calls can be sent that inform parties involved with the shipment about delivery notifications, changes in delivery point, and also permit recipients to confirm and reply to these automated messages.
Regardless of the type of business you have, a TMS system offers multiple benefits to find, route, and organize LTL shipments. If you have questions about setting up a customized TMS solution for your supply chain related business, contact a professional 3PL such as Redwood Logistics to ask about how your company can integrate this affordable platform into your daily logistics operations.