Selecting a transportation management system (TMS)

Freight transportation management is like a game of connect the dots, except that the dots are constantly moving throughout the world. Those working within a complex supply chain environment will be acutely aware of the perils of ignoring your transportation operations. Get it wrong, and not only is your profitability directly affected, but you also risk losing your most valuable asset: your customers.

Therefore, it is important to have technology solutions, like a TMS, that can evolve and adapt with these needs. But what exactly is a transportation management system (TMS), and what difference can this technology make for your company?

What is a TMS?

A transportation management system (TMS) is a specialised software for planning, executing, and optimising the shipment of goods. 

The TMS commonly looks after the following types of transportation:

• Single mode: the transits are performed by only one vehicle type (e.g., sea, truck, rail, air, etc.)
• Multimodal: One carrier uses more than two modes of transport
• Intermodal: This type of transportation requires more than one carrier and more than one contract. Vendors are offered more control over freight and carriers but have more management responsibilities.

Benefits of a transport management system

9 factors to consider before choosing a TMS

Today, customers are just as concerned with how well you can adapt to their changing demands as they are with how much you charge. Flexibility and visibility within the supply chain are crucial to staying ahead of the competition and ensuring your customers remain loyal.

Whether you're a first-time TMS buyer or an experienced user looking to upgrade, there are key factors you need to consider before beginning your TMS search.

1. Remember your clients: Select a TMS that enables accurate and quick customer communication. Look for companies that offer a secure internet portal where clients can see real-time load status.

2. Get the best of both worlds, carrier ad broker: Working with a truckload carrier, a brokerage, or both is possible therefore, these can be distinct or combined, and the TMS should be adaptable.

3. Recognise current and future requirements: Pay for only the features you need to run your business and find a TMS that uses a modular or building block approach, allowing you to scale and add features as needed.

4. Pick a third-party accounting package: Look for a TMS that integrates top-level with your existing system, such as QuickBooks or Sage. Billings are effortlessly automated with this combo.

5. Know the integrations available: Look for a TMS that interacts with supplementary tools and services that match your specific business needs, from EDI to trailer tracking and beyond.

6. Seek a proven system: Request case studies or references from similar businesses from vendors. TMS vendors should be able to provide real-world examples of how they meet specific goals, such as operating a specific trailer or transporting a product with specified criteria.

7. Spend less time worrying about infrastructure: Businesses are established on both their reputation and their offerings. By proactively addressing customer-facing concerns like late loads and dock time schedules, the right TMS generates confidence.

8. Be business intelligent: To examine how to optimise processes, a good TMS gives business intelligence data such as deadhead percentage, revenue per loaded mile, and on-time %.