A transportation management system (TMS) is often considered an ideal choice for less-than-truckload (LTL) and full truckload (FT) shipments. In reality, a dedicated TMS can be applied to improve the efficiency and dynamics of any type of shipment. For small package shipments, a TMS can prove to be an invaluable resource by providing the following significant benefits.
Optimized Routes Reduce Delays in Shipping.
Shipping hundreds of small packages pose challenges for shippers. Getting a small package from point A to point B could easily vary greatly in terms of time requirements. The package may be transferred multiple times between different modes of transit as well. As a result, having an optimized route before sending small packages makes the difference between an on-time delivery and a late delivery. More importantly, the vast reaches of Amazon have made small package delivery expectations excel beyond traditional capabilities in legacy ERP systems. Therefore, the only way to effectively compete with Amazon’s rapid shipping is by ensuring small packages are assigned to the most appropriate, faster route through a dedicated TMS.
Customer Service Is Essential to Small Package Shippers.
Customer service for small package shipments is more important than the same customer service for large shipments. Rather than focusing on a vast number of identical products, small package shippers need to be able to provide unparalleled customer service to hundreds, if not thousands, of individual customers on a recurring basis. Consequently, the amount of paperwork and documentation needed to improve customer service on a small-package level is much more, which can be effectively organized, managed and accessed from within a TMS.
More Products Demand More Warehouse Efficiency.
Warehouse efficiency is defined by how many orders are processed, packaged and shipped in relation to the actual number of incoming orders. Moreover, small packages may not have the same valuation of larger items, so accuracy in completing these processes is critical to maintaining warehouse efficiency. A TMS furthers this cause by allowing shippers to integrate the process from start to finish, eliminating discrepancies and improving accuracy throughout the warehouse and into actual shipping. In addition, a TMS can help small package shipper monitor and manage inventory levels, explains Larry Lewis of PARCEL Media. In fact, this point is reiterated as one of the standards any shipper should check for when selecting a TMS solution for their business.
Small Package Means More Audits Are Necessary to Catch Errors.
Small packages are usually less than 150 pounds, and as a result, they routinely fit into tight spaces. Unfortunately, small packages are inherently more likely to be misplaced, mishandled or forgotten when transferring them between modes of transit, reports Jim Greer of Talking Logistics With Adrian Gonzalez. In other words, a single small package may end up on a different truck than intended, and until a customer reports not receiving a package on time, the shipper is often left in the dark as to why the package is taking so long to be delivered. Yet, the volume of small packages continues to grow, and the carrier may not issue a refund appropriately. Therefore, increased automated auditing and enhancement of intermodal tracking and processing are critical to catching these billing inconsistencies in a cost-effective manner.
Compliance With Changing Rules and Regulations in the Shipping Industry.
As the world has become more connected, ensuring your small package shipments adhere to any and all regulations for international transit is essential to preventing delays and the possible assessment of penalties. A comprehensive TMS must be able to automatically notify shippers of changes in shipping requirements when sending packages abroad. More importantly, some shipments may fall under specific criteria for verifying recipients and financial information before shipping. Ultimately, the TMS should serve as an automated system for verifying all small packages are ready for international shipping at the time of processing.
A Dedicated TMS Is Likely Cheaper to Maintain Than Your Existing ERP for Small Package Processing.
The manufacturers of legacy ERP systems have lost footing with the rise of the cloud. In some cases, these manufacturers may no longer provide customer service or updates to ensure your systems operates according to your needs. As a result, upgrading your system to a cloud-based TMS, such as the Cerasis Rater, may be more cost-effective in terms of simply maintaining your current operation than using your outdated system. Since the pressure to rapidly deliver small packages grows with each passing day, the need for a TMS to handle all of your small package needs has never been more important.
Small Packages Are More Likely to Result in Returns.
Buyer’s remorse is real, and customers ordering small items are more likely to decide to simply return an item due to buyer’s remorse. Unlike larger FT or LTL shipments, small packages are typically comprised of one or two items. As a result, shippers need to consider more returns will need to be processed when shipping small packages. In turn, the TMS can handle both incoming returns and outgoing shipments concurrently, reducing the incidence of lost costs for manual handling of incoming returns.
These are just a few of the benefits of using a TMS to handle small package shipments, and the real cost savings could easily add up to more than 15 percent. If you have not yet considered implementing a TMS for all of your shipping needs, including small parcels, you are losing money faster than you realize. Since the process for integrating today’s TMS solutions is much simpler than in the past, the time to act to improve your bottom line is now.