Employing a transportation management system into your business may sound like a daunting challenge to undertake. However, the potential return on investment can easily wash away any anxieties you may feel about changing the way you have managed your transportation and supply chain needs in the past.
At the same time, increasing demands on supply chains are forcing many shippers to seek out ways to streamline and improve transportation efficiency. To this point, consider the growing call from customers that want to see faster deliveries as a standard procedure. Retailers, both big and small, have been challenged to overcome the logistical demands of the era of online consumerism.
The burden of the retailers to evolve their transportation strategies doesn't end with them. The challenges they encounter have also trickled up the supply chain to their suppliers and manufacturers.
Whether your business specializes in manufacturing retail products or industrial chemicals, a transportation management system can help you succeed at evolving your supply chain through data and intelligent planning.
The following points are just three ways a TMS could benefit your business:
(1) Transportation Optimization
The strategic planning capabilities of your transportation management system will improve over time. With each shipment, the program collects data, including carrier fees and transactions that it analyzes and cross-references with each use.
With the program's ability to dissect a wealth of data to identify trends, you can easily improve your carrier selection based on cost, transit times, and a variety of personalized criteria. And if the system has the functionality, you can even explore additional shipping modes via rail or air that could improve your supply chain efficiency.
(2) Better Inventory Control
The primary goal of a transportation management system is to help you improve your shipping practices. While minimizing late deliveries and identifying cost-effective carrier options will ultimately help you optimize transportation, you'll find that other areas of your supply chain will also be rewarded.
By integrating your system with other programs, such as an ERP or warehouse management system, you can establish an even clearer picture of your inventory. As these programs feed data to one another, you will have heightened visibility over inventory levels, which can be used to pinpoint trends throughout the year. Identifying inventory trends, especially for businesses with large numbers of SKUs, will help you make better use of warehouse space and optimize your purchase ordering strategy.
(3) More Satisfied Customers
A transportation system management system can improve several areas of your business, including customer service. According to the 2017 State of the North American Supply Chain Survey, nearly 40 percent of shippers were concerned about on-time delivery performance. With increased pressure from customers to deliver on time, the statistic shouldn't come as too much of a surprise.
Nonetheless, the driver shortage and industry regulations have made it more difficult for a growing number of carriers to meet on-time expectations. Fortunately, a transportation management system can help you hold your carriers more accountable for their performance. If the data shows repeated patterns of late or missed deliveries, you can realign your carrier selection.
Additionally, some systems have the ability to allow you and your customers to exchange data. For instance, a system could send a text message to notify your customer of a delivery that has just been scheduled or delayed.
The value of data and communication has never been more important. With the right technology, you can take your shipping strategy from pin and paper to modern automation and efficiency.