Transportation Management System: Benefits, Features, and Main Providers

Updated : Oct 10, 2024
Business Benefuts of TMS

Quick Summary: If you're a business owner, it's important to know your supply chain and exercise control over your incoming and outgoing products or goods. But how? An effective transportation management system comes into action here, as it helps address the different requirements of incoming and outgoing commodities. Interested in knowing more about TMS? Read on the following blog to explore various aspects of the transportation management system.

The total spending on logistics worldwide in 2020 amounted to $9 trillion. Effective supply chain management has become one of the top priorities of all businesses, serving a formidable role in strengthening international trade. Where does a transportation management system or TMS come into play in the global logistics market? As a business owner, you need to know your supply chain and exercise control over the flow of incoming and outgoing goods.

A credible TMS solution could help you address the requirements for planning, organizing, monitoring and analyzing the movement of incoming and outgoing goods. Let us explore the notable benefits and features you could expect in transportation management software in the following post.

Table of Content
  1. What is a Transportation Management System?
  2. Why Is a Transportation Management System Important for Your Business?
  3. Significant Benefits of Transportation Management System
  4. How Does a Transportation Management System Work?
  5. Important Integrations
  6. Top Transportation Management System Providers
  7. Conclusion

What is a Transportation Management System?

The foremost aspect in discussions about TMS meaning is the outline of reasons for adopting a TMS solution. The transportation and logistics market has been through some massive changes in recent times, with unprecedented challenges and bottlenecks. On the other hand, customer expectations about speed of delivery have been growing. Businesses have to utilize a logistic management system to adapt to changes in the transportation and logistics market.

You can find multiple perspectives on the definition of a TMS. The most common description of a TMS solution is that it is a group of applications that help in planning and executing the movement of goods through the supply chain. It is one of the latest software development trends and is an integral component of modern supply chain transportation management systems. Shippers, including manufacturers, distributors and retailers, as well as third-party logistics organizations, could use TMS software for various benefits.

The simple example of truck management software could offer insights into advantages of TMS solutions. In the case of trucking, a TMS could support the planning, execution and optimization of transportation through fleets of trucks. Businesses could leverage TMS software to identify best routes and optimize the use of resources. At the same time, the assurance of legal compliance of shipments, automation of administrative tasks and documentation management prove the significance of TMS solutions.

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Why Is a Transportation Management System Important for Your Business?

The basic overview of the features and benefits of a TMS system in the definition of transportation management software provides valid reasons for their inclusion in modern supply chains. You need to dive deeper into the advantages accessible with new and innovative TMS solutions for identifying essential requirements in creating transportation management software.

The two primary user groups of a transportation and freight management system include shippers and third-party logistics providers. Vendors provide similar platforms to the two groups with specific exceptions. The most important feature of a TMS for fleet management systems is the control tower capability, which allows users to monitor the complete shipment process. The TMS control tower could collect real-time data about goods through API or EDI technology alongside offering access to valuable data.

Transportation management software development services could transform the collected data into viable insights regarding supply chain performance, customer service issues and financial situation. Therefore, a powerful shipment management software would help in planning and execution of the shipment process alongside increasing visibility.

Significant Benefits of Transportation Management System

Wondering how businesses can enhance their visibility and control over their supply chain? Here are some notable benefits that validate the use of TMS solutions in modern supply chain management systems.

TMS Solution Benefits

  • Efficient Operations

The advantage of advanced analytics and custom software solutions with TMS is that it can help in obtaining accurate predictions regarding transportation demand and expenses. On top of it, businesses could use advanced analytics with the transportation management system to determine expected order delivery times. TMS solutions can help businesses in obtaining accurate AI-based recommendations for optimal transportation routes and carriers.

  • Safety of Goods

Businesses could leverage RFID technology in conjunction with TMS logistics software to monitor private fleets for sensitive products. Real-time tracking of shipments alongside monitoring the status of goods in the case of highly regulated products can offer better safety for goods.

  • Legal Compliance and Documentation

Another significant advantage of transportation management software solutions is the advantage of easier legal compliance and documentation. Technological advancements such as integrated electronic devices could help in monitoring rest periods of drivers. Businesses could also maintain documentation of service records of in-house fleets to ensure compliance. Furthermore, the advantages of TMS for freight brokers include the flexibility of connecting to systems of shipping carriers and shipment data platforms. As a result, it can provide a seamless exchange of transportation and shipment tracking documentation.

How Does a Transportation Management System Work?

The outline of important benefits of the transportation management software development process or TMS solutions proves their significance in the transportation and logistics industry. What are the capabilities of TMS solutions which help them in addressing the specific transportation management needs of users? Here are some of the prominent features you should expect in a reliable transportation management software solution.

Features of TMS Solution

Transportation Planning

An effective TMS implementation guide would highlight the functionalities of transportation planning. Software development for transportation management could utilize historical data on incoming and outgoing orders for planning transportation demand. The TMS should help in planning optimal routes, transportation modes and shipping schedules with carefully planned milestones.

Selection of Transportation Providers

The next important feature in transportation management systems points to flexibility in selecting transportation providers. You can hire dedicated developers and create a freight broker TMS solution with configuration of different parameters for selecting transportation providers. Automated evaluation of transportation providers and workflow definition for multi-department approval streamline the processes for onboarding transportation providers.

Transportation Expenses Management

Transportation management systems should also have the features required for automated assessment of transportation costs. The basic overview of TMS meaning explains how it utilizes automation to achieve better efficiency in physical movement of goods. TMS users can capitalize on benefits of automated allocation of transportation costs alongside involving AI in evaluation of transport expenses.

Order Management

TMS solutions also help simplify the order management process by creating templates for transport orders. In addition, the TMS platforms leverage rule-based compliance for consolidating transport orders throughout multiple departments and business entities. The benefit of real-time tracking of status of transport orders helps to improve the efficiency of transportation management.

Transportation Optimization

The overview of a transportation management system implementation guide also draws attention to features for transportation optimization. Users could define the rules for optimizing transportation to ensure benefits of reduced shipping times and transportation costs. Transportation management systems must offer complete control over international and domestic shipments across different transportation modes. Real-time monitoring of transport locations, driving speed, driving conditions and health of shipments helps in optimizing transportation management.

Documentation Management

The next crucial feature of a transportation management system refers to documentation management. It should provide the feature of a seamless exchange of documentation among different stakeholders in the supply chain management process. Starting from transportation contracts to shipping documents, a TMS solution should offer a comprehensive platform for monitoring important transportation-related documentation.

Analytics and Reporting

The effectiveness of transportation management software would also depend on its capabilities for analytics and reporting. TMS solutions should offer the facility for tracking important transportation KPIs, such as transportation orders, average cost and the number of claims. Additional benefits of advanced fleet management systems with TMS include trend-based predictions for transportation demand. Transportation management systems can leverage granular analysis of transportation plans for identifying errors in transport planning.

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Important Integrations

The final highlight among the features of TMS software draws the limelight on the necessity of integrations with other supply chain management systems. Here are the essential integrations required for a TMS in supply chain management.

  • TMS and ERP integration can help in accurate planning for transporting inventory between facilities and utilizing transportation data for strategic planning.

  • Integration of a truck management software or TMS solution with an order management system helps in creating transportation plans for outgoing goods and automation of data inputs.

  • The integration of TMS with a mobile inventory management system can help to track inventory and shipment from easily from a mobile-based interface.

  • The integration of TMS solutions with shipping carrier systems could help in enabling seamless exchange of transportation documents. It can enable efficient and accurate tracking of shipment progress.

  • Transportation management software must also work with warehouse management systems for accurate planning of warehouse resources and optimizing item arrangement.

  • The combination of TMS with procurement software helps in planning transportation for inbound orders alongside ensuring automated data inputs.

  • The integration of TMS with accounting and billing software helps in documentation of invoice transactions alongside automation of the billing procedures.

  • Finally, the integration of a TMS system with hardware such as RFIDs, ELDs and GPS tracking devices helps in optimizing transportation management.

Top Transportation Management System Providers

The most popular choices among transportation management systems for modern businesses would include the following entries.

  • SAP Transportation Management
  • Oracle Transportation Management
  • BluJay
  • MercuryGate

ConclusionThe detailed insights on benefits, features and examples of top transportation management system providers invite attention to TMS solutions. Transportation management systems can serve as efficient solutions for helping you gain control over shipment procedures. You can monitor the goods as well as the vehicles which carry them across different destinations. As the business landscape continues evolving with new trends in consumer behavior, it is important to leverage TMS solutions.At Radixweb, we can help you build a feature-rich transportation management system to modernize your business processes. So, what are you waiting for? Connect with us and learn more about the best practices for implementing transportation management software for your business.

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Sarrah Pitaliya, Vice President of Digital Marketing department at Radixweb precisely navigates strategies for growth, build marketing capabilities, align the organization around customer experience and mentor teams about new digital, social, mobile channels and customer opportunities. Apart from work, she is a fitness freak and coffee connoisseur.