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If you have high volume of work, adding headcount seems like one of the first option that you will turn to. But this may not be the best course of action every time. That’s where the need for Transportation Management System (TMS) comes into play. A survey featured in Logistics Management shows that just 35% of shippers are using TMS in their supply chain. On the other hand, that survey also indicated that 39% of companies planned to implement or upgrade their TMS in the next year - a signal that could result in higher adoption rates in the future. Logistics managers need to realize that adding TMS instead of headcount can be the right way to grow their business. Here are 5 best benefits you are guaranteed to receive from using a TMS.
1. Automate the manual process
It can be very time-consuming to do the repetitive work manually. Tasks like planning the delivery route every day, assign drivers, assign loads to vehicles while maintaining a high Vehicle Fill Rate (VFR), can take most of your working day. With a TMS, all these works will be automated with one click. It helps you automate all repeated work and grow your business the way you want. By automating manual processes, you can have time to focus on other important tasks like strategic planning, management. The value is amazing, and it’s possible to acquire great results very fast. Though this is not going to be a walk in the park, the ROI on its own will be second to none, and that’s what you need to think about.
Specifically, TMS like Abivin vRoute automatically optimize route plan, vehicle loads, assign works, save files, notes, calls, and emails. It will also export and retrieve information, store the prior addresses, and so on. Computer power can reduce mistakes and maximizes the abilities of people. Therefore, it’s a lot easier to manage your business and take decisions when everything is automated, and you can tackle all the work you want in no time.
2. Manage data and information in real-time
Thanks to TMS integration, you can perform data management and information management in real-time. TMS helps you track deliveries accurately. You can also keep records for customer reference, invoice auditing purposes, potential shipment claims, damage claims, and freight rate auditing and negotiation. It’s a lot simpler and more comprehensive than the hundreds of excel sheets that you take fifteen minutes to find every time.
Furthermore, TMS consolidates the steps in the supply chain process. This means managing the information in a more organized manner while having an overview that gives you better decisions. Another thing is that TMS helps integrate the information and relevant data up the chain. It also does a very good job of allowing you to downstream info to other departments like accounting, customer service, or sales. Data is king, and it’s crucial to have the means to analyze and manage data. With a good tool, you will be able to achieve all those results very fast. TMS is great at offering a way to correlate data integration and customer experience. This leads to amazing customer service and a return for investment that you do not want to miss in the end.
3. Enable a proactive approach towards supply chain management
Why is this important? Because now you don’t have to rely on things like manual interaction on spreadsheets. Instead, you have reactive transport commands that are fast, efficient, and very easy to work on. You are also equipped with a way to manage costs and handle internal metrics. Multiple departments like suppliers, customers, and carriers can be integrated as parts of the same platform. In this type of omnichannel environment, logistics managers will be able to deliver more values and better quality in a proactive manner instead of a passively reactive way.
Moreover, by implementing a TMS, the same logistics managers can streamline their transportation departments, connect their carriers to their 24/7 online networks, and improve the way they procure and manage freight.
4. Have a proven Return on Investment
What a lot of logistics managers don’t realize is that implementing a TMS brings in irresistible ROI. In fact, it can save companies money simply by lowering the freight/vehicle spend. The faster you do that, the more you will end up saving. An ARC survey on the ROI of TMS indicates that of these savings, nearly 60% of users indicated that less than 25% of the net savings were absorbed by the TMS.
So how does a TMS save your cost? The saved cost can be attributed to reducing the number of required vehicles, full loads, lower cost mode selections, better routing, and better procurement negotiations. Plus, TMS solutions are always evolving. It brings in new forms of optimization, mobility enhancements, improved usability, better analytics, and machine learning capabilities.
All these savings can be beneficial for every logistics manager. With their lower barriers to entry, lower upfront costs, and easier maintenance and upgrading, cloud-based TMS applications have taken off across a number of different supply chain solutions and platforms. TMS improves customer satisfaction, warehouse efficiencies, enable new delivery capabilities, inventory reductions, and cash flow improvements. In the end, this helps increase the net savings, and that leads to a pretty impressive ROI.
5. Enhance transparency and risk management
TMS helps you track products at any given time during the process. You can also detect any risk if it appears. That leads to improved transparency and much better values for customers. Also, you will have no problem comprehending why those issues appear and what you can do. You can easily respond swiftly with some immediate actions.
In the end, using TMS solutions can be even more effective than just adding headcount. Sure, the latter seems like a simple option at first, but you won’t be able to obtain the ROI you expect.
References:
1.https://www.supplychain247.com/article/8_reasons_every_shipper_needs_a_transportation_management_system
2.https://www.forbes.com/sites/stevebanker/2014/09/04/roi-is-driving-growth-in-transportation-management/#f69112c6bbf7