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Transportation Management System ROI: What Other Business Areas Can Benefit?

transportation management system roi

Unless your organization has been absent from the takeover of TMS in the conversations of online and print media, you have likely encountered plenty of reasons why a transportation management system (TMS) benefits shippers. Unfortunately, the information is not always clear, and figuring out if the investment into a TMS is worth it can be even more frustrating. Obviously, it saves money and reduces overhead, but where? Let’s take a closer look at how Transportation Management System ROI actively strengthens supply chains.

Transportation Management System ROI: What Other Business Areas Can Benefit?

Integration Enhances Inventory Control Through Better End-to-End Visibility.

Enterprise resource planning (ERP), warehouse management systems and endless spreadsheets might be involved in managing your operation. Although you can determine where a product is in its lifecycle through these systems, knowing its exact location by simply entering a tracking number is not always possible. This is where a TMS comes into play.

The TMS can provide a link between your existing systems and a dedicated transportation management system. Easily import or export data, and you can simplify accounting and payments through routine reports and billing. In fact, the Cerasis Rater can identify instances of overbilling and overpayment, request appropriate refunds and catalog weekly freight payments due in a simple, easy-to-read report. Moreover, this means you can manage inventory at any time and from any location, ensuring you have the products on-hand when your customers need them. In other words, the amount of work and stress in managing accounting decreases while amplifying your company’s ability to respond to consumer demands.  

Cloud-Based Data Analytics Identify Trends and “Concerns.”

Speaking of customer demands, inventory control is changing in wake of the TMS Revolution. Cloud-based TMSs utilize analytics to identify key trends that not obvious. For example, everyone knows that sales will peak around the holidays, but analytics can identify peaks that happen when you think you are in a lull.

Another transportation management system ROI comes in the form of fewer chargebacks from consumers. When shipments arrive late continuously or damaged, your company could be liable for the issue. If you ask the carrier, you may get an answer that simply directs you to your freight insurance plan. But what if you could identify these worrisome issues when they become more than just a nuisance? In addition, how much are these events or incidents costing your company overall?

You could lose current and future customers. A 2017 survey of shippers found that up to 40 percent are concerned over continued delays and failure to deliver products on time and as expected. While the cheapest carriers may seem ideal, they may be more likely to become a contributor to this industry-wide “concern.” Therefore, knowing when the cheapest or most commonly used carrier is no longer helping your business grow and meet customer expectations is essential to ensuring customers are happy.

Web-Based Portals Give All Parties Access to Pertinent, Updated Information.

If you schedule a shipment pick-up, do you expect the customer to be notified? Not really, but this highlights the possible problems and lack of visibility that can exist within the supply chain. All parties, including customers, vendors, shippers and carriers, need to know where their products are right now, at what cost and when they will arrive--without spending hours on the phone.

Web-based portals give these parties access to like information, including customers. While customers may not be able to log into your TMS, you can automatically transfer product location to the customer-facing site, ensuring everyone knows what they need to know for the shipment to be processed and delivered as quickly as possible. This promotes scheduling efficiency, which inherently leads to greater shipping capacity. In other words, more shipments equal more revenue and higher transportation management system ROI.

Both Inbound and Outbound Logistics Benefit From Implementing a TMS.

Inbound and outbound logistics are two sides of the same coin, and both can reap increased profits from implementing a TMS. According to Bridget McCrea of Logistics Management magazine, the overall freight spend, including inbound and outbound freight costs, can be reduced by up to 10 percent, if not more, after implementing a TMS.

In addition, you can ensure your vendors are adhering to your list of preferred carriers and rules for sending product to your company. Meanwhile, you can optimize the flow of product out to consumers. Paired together, this creates a steady, reliable flow of inventory, which helps your business grow. A TMS may also help everyone involved by reducing the amount of paperwork needed per shipment.

For example, you can fill out, email, print or even email-to-fax bills of lading within the TMS. This virtually eliminates manual sending and distribution of bills of lading. Considering the legal risks involved with international shipments, such as documentation requirements for importer of record, the use of a cloud-based TMS can also lead to savings through reduced legal risk. In other words, you can retrieve the documents anytime and at any place.

The Big Picture.

More shippers, vendors and businesses in-between are turning to the use of a TMS to manage all inbound and outbound logistics needs. With consumers putting the pressure on shippers to deliver on time, at the lowest cost and without any problems, your company cannot afford to wait. You need to boost efficiency and reduce overhead through automation. You need to look beyond what your eyes see to find the smallest savings in every nook and cranny. It’s time to implement a TMS because it is the solution to providing a positive ROI throughout your supply chain.

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Kevin Jessop

Kevin Jessop

Marketing Project Manager at Cerasis
I handle tactical execution of our marketing strategies as well as help execute new projects and collaborate with our Marketing Director to continue to push brand and company awareness.
Kevin Jessop

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