Transportation management systems — or TMS — as they’re often referred to, are closely related to logistics. They help optimize supply chain management and distribution systems. And, anyone can use them, from manufacturers, to intermediaries, to retailers; to help with logistics operations.
Using transportation management systems
In more detail, a transportation management system can help plan logistics operations, by making them more effective, cost efficient and timely. However, it doesn’t stop there, as it can also help managers keep an eye on what is going on during the distribution process, by providing data about real time location and billing details and even invoicing. This is especially useful in long distance, complex shipments. After the shipment process is complete, the transportation management system can contribute to the evaluation of the process. This is feasible by producing reports that may contain statistics and several KPIs on what went right, what went wrong and how to improve the next time around.
It does sport some features in common with fleet management, such as data about the location of a vehicle, the behavior of the driver and even the vehicle’s health status. However, it boasts a more complex design and user experience, since its aim is to optimize long distance logistics performance. Some of the features you might come across when looking for a transportation management system may include:
Separation of the shipment, if necessary, and allocation into batches
Some shipments may contain large quantities of payload. A transportation management system can calculate how to split this payload into smaller batches, so it can be transported faster and more easily.
Means of transport and carrier selection
There are lots of ways to transport a shipment. Transportation management systems can take into consideration the time needed to transport, the cost and how fast the delivery will be; and, of course, suggest the ideal transportation method. It might even suggest different transportation methods for different types of payload.
Plot the most efficient route
This is something that fleet management services can do as well. That said, seeing the available routes on a map can help a manager decide which one could be the most effective. Seeing the results of the trips can help them re-plot routes, if needed.
Calculation of payments and payment transparency
Based on the distance and transportation method, transportation management systems are able to calculate the cost of a shipment. Moreover, they can file the transaction and create a report that everyone in the company is able to see.
A lot of transportation management systems can show the availability of storage places available, so the fleet manager can choose the best and most efficient storage solution; that’s in case the shipment needs to be stored for some time, for any reason.
Reports about shipment efficiency
When planning a transportation, we include estimations about pretty much everything. TMS can provide reports with the results of said transportation that can be evaluated from fleet managers; who will, of course, determine if they were efficient or not.
What to keep in mind
These features mentioned above are only indicative. With a bit of research you can find services that offer many more features. Also, it’s worth mentioning that, since over the last few years logistics have grown so much, the role of transport management systems has become increasingly important. And, with the rapid evolution of technology in this industry, the available features have become diverse and more accommodative. Such an example, which may bring exceptional improvements, is the fact that some vendors have already started integrating AI into their operations.