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Four Compelling Reasons Why You Need Transport Management System

Dec 3, 2017

As the levels of global trade increases, both in terms of volume and complexities, transactions have started taking place between multiple parties and suppliers. Additionally, such transactions are also happening over large geographies. To cater to such increasing levels of trade, businesses have to manage logistics services spanning over vast territories. This has increased the amount of shipping that takes place both in terms of distance and volume, adding to the overall cost and time. It has become a significant challenge for the organizationsSE_Demo2 to manage their transport logistics efficiently. Consequently, businesses are relying on transport management system (TMS) to move freight from origin to destination reliably, efficiently, cost-effectively.

Benefits of Transport Management System (TMS)

Warehouse Efficiency

Transport management system can drastically reduce the total freight time and enable companies to stock less as turnaround times are significantly optimized. Also, a TMS solution integrated with an ERP system helps reduce the number of errors during entry, which saves time caused by data errors. Additionally, a TMS working in tandem with warehouse management system (WMS) provides better visibility into the supply chain and help maximize productivity and improve the process of moving goods.

Inventory Optimization

Since the transport management system assures faster delivery of goods, it allows the company to function with a minimal level of inventory. As businesses can ascertain the time taken for shipments, they can accurately forecast their inventory requirements and hold an optimal level of stocks.

Savings in Inventory and Freight Cost

As a result of holding lesser inventory, the company can potentially save millions in inventory cost. Since they don’t have to maintain as much inventory as before, they can better utilize the inventory cost in some other business function. By implementing a TMS solution companies can save as much as 90% of the total freight costs which can enable them to remain competitive and even afford price reduction on the final product.

Improved Customer Service

A transport management system with reporting and analytical ability allows companies to monitor the outcome of each and every decision they take. For instance, when businesses partner with multiple carriers, TMS solutions analyzes the overall cost, freight time, and other parameters of each shipping provider in order to perform analysis on the effectiveness of each partner. The solution can provide detailed insight into the cost incurred and the time taken by each partner, which can help them make the correct decision in the future. This way they can choose partners based on the needs of the customer. For instance, if customers prefer faster deliveries then they can select carrier with fastest transit times, and choose economical carrier if cost is the primary concern of the customer.

For more information on transport management system, supply chain, logistics software, and TMS solutions:

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