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The Evolution of Transportation Management Systems and How to Get the Most From Them

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How have transportation management systems evolved? And how can you get the most out of a TMS without negatively impacting your established business processes or customers? We have the answers!

The growing list of supply chain concerns is forcing shippers and carriers to make significant changes to their operations. The list of challenges we still face in this industry include:

  • Severe supply chain bottlenecks
  • Shipping delays
  • Labor shortages
  • Driver shortages
  • Increased customer expectations
  • Capacity and equipment issues

Whether you’re looking to shift from a manual process to a more integrated and automated solution, or you are thinking of upgrading to a better transportation management system (TMS), here’s what you need to know.

What Does a Modern TMS System Do?

In the early iterations of transportation management applications, we saw basic functionality such as rate management, carrier communications, and load consolidation. Over the past two decades, enhancements have included functions such as multimodal routing, cross-docking or pooling, and payment integration.

Today, robust solutions provide an end-to-end process to automate and integrate every aspect of your operation, including:

  • Order entry
  • Consolidation of orders
  • Modes of shipping
  • Carrier selection
  • Tracking and visibility
  • Freight settlement
  • Freight & parcel auditing

If you used a TMS system in the early days, you probably remember staring at green type on your computer screen and the high cost of implementation and ongoing computing power. 

That’s all changed.

Cloud-Based TMS Solutions

As TMS solutions moved to the cloud, costs dropped significantly while computing resources grew exponentially. It used to be that only companies spending upwards of $100 million or more on freight used a TMS. But cloud-based TMS solutions allow even the smallest organizations to benefit from the advanced features without the hefty price tag.

SAAS TransporTation Management Systems

The ubiquity of high-speed internet allowed for Software as a Service (SaaS) offerings, eliminating the capital investment needed for expensive mainframes and outsourcing the responsibility for software upgrades and hardware maintenance. This made TMS systems much more affordable as a subscription service with small monthly fees. 

Shipping Automations

Modern TMS solutions now also allow you to automate much of the tedious, routine work to eliminate manual data entry and human errors. By utilizing APIs and web connectivity, you no longer need to call or check for rates and availability or be concerned about accurately tracking transactions. It all happens automatically to minimize workloads and optimize rates.

Companies moving or upgrading to modern TMS solutions are seeing significant improvements. Major online retailer Newegg, for example, reduced their shipping process by over 50% by migrating to a modern TMS.


What You Need to Know About TMS Solutions

Not all TMS solutions on the market now are equal, however, so if you’re shopping around, there are some things you need to consider.

For example, not all systems are customizable to your work processes. And the last result you want when trying to optimize is to have a TMS dictating or changing how you do business. Preferably, you need a system that integrates with third-party solutions you may already use such as ERP, WMS, order systems, and even any custom internal apps you may use.  

The best TMS solutions should also excel at these critical functions:

  • Shopping for Rates: Your TMS should help you find the best rates quickly without having to log in and out of carrier websites or email for spot quotes.

  • Real-time Tracking: A major value proposition for a powerful TMS is offering real-time at-a-glance tracking of every inbound and outbound with multi-leg visibility.

  • Carrier Invoice Auditing: Your TMS should help you find hidden freight savings and hold carriers accountable on inaccurate billings.

  • Carrier and Shipping Analysis: An often overlooked aspect to shipping is analyzing performance. Your TMS should give you automated reports and analysis enabling you to optimize operations and negotiate with carriers better.

With the right TMS system, you can leverage your shipping data to improve your resource efficiency, vendor evaluations, and visibility on inbound and outbound products.

In 2022, You Need a Robust Transportation Management System

Overcoming today’s challenges — and whatever comes our way tomorrow — is essential to remain competitive and manage costs. A modern TMS solution can help you streamline and optimize your process holistically, so you can focus more on your core business and worry less about logistics.

Industry analysts don't expect supply chain problems to evaporate suddenly, so 2022 may be another rocky ride as we all navigate an evolving environment. At the same time, the explosive growth in the retail sector promises to increase demand — and opportunities for profit. The right TMS solutions will scale to meet this demand and allow you to improve your efficiency, productivity, and profitability.

How We Can Help!

New Case Study - Download our 4Wall Entertainment case study to learn how FreightPOP's transportation management system helps customers in fast-paced industries improve quality and speed on parcel and freight. 

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