Surging e-commerce, demand for faster and cheaper shipping, and unrelenting demand for superior customer service are enough to make any shippers head spin, but as shipping costs soar throughout 2018, shippers will be looking for ways to manage over the road modes better. Defining “better” is also a difficult task. For the purposes of objectivity, better refers to accessing more available truckload capacity, which is tightening more than ever, says the Journal of Commerce, scheduling freight with the right type of carrier that specializes in a given type of full truckload, and securing such capacity at competitive rates.
Managing existing over the road modes of transportation can feel like an insurmountable task, but a transportation management system (TMS) could be the solution. Let’s take a closer look at the problem with trying to manage over the road (OTR) modes through traditional, manual data entry and freight scheduling versus using a TMS.
The Challenge: Too Many OTR Modes Make Visibility Difficult
Over the road modes of transit include much more than many shippers realize. Typical over the road modes include full truckload, less than truckload, and small package or parcelshipping. To further complicate the process of freight scheduling, shippers must decide which LTL carrier to use, whether to purchase cargo insurance, consider the implications of shipping a package via parcel or small package considering advancing dimensional pricing models, and what exact type of full truckload would be necessary when consolidated. Specifically, full truckload includes dry van, refrigerated, step back and removable gooseneck trailers, asserts Direct Drive Logistics, as well as flatbed carriers.
The Freight & Transportation Management Trends to Know in 2018
That amounts to roughly 64 potential combinations for over the road transportation, and that excludes value-added services, such as ease in freight auditing or payment processing. It is easy to see why shippers experience trouble in managing over the road transit, so visibility into this mode quickly becomes murky.
In addition, regulatory reform, which is not yet passed in either house of Congress, the impending out of service deadline regarding the electronic locking devices (ELD) mandate, and the crumbling infrastructure serve to only complicate over the road freight management. However, shippers should consider how a TMS could mitigate these risks and ensure stability, regardless of how quickly rates rise.
The Solution: Dedicated TMS Can Manage All OTR Modes, Making Full Use of OTR Possible
Take a moment to consider what dedicated TMS is. It is a one-stop platform that manages all existing transportation modes. Considering the 64 potential combinations, when applied to the course of 1000 shipments, it amounts to 64,000 opportunities for error. Applied to 100 potential origins and destinations, the number of potential combinations rises to 6.4 million. There is no room for error or mistake in data entry, but a dedicated TMS relies on technology, not just human input, to ensure shippers are getting the most value from logistics.
The Benefit: Advanced, Cloud-Based Technologies Allow for Continuous Improvement and Accountability
Continuous improvement and accountability are among the top benefits realized through a dedicated TMS. A dedicated TMS Makes information presentable, identifying at-risk shipments, average freight spend, breaking down barriers to continuous improvement, and much more. Although using more carriers can significantly increase freight spend, reports Dan Goodwill of Canadian Shipper, a TMS can effectively manage multi-carrier and multi-driver relationships. In a sense, a shipper is involved with a system, not necessarily each individual carrier.
Now, imagine the back-office expenses associated with managing freight in-house. For over the road modes, personnel must be allocated to provide information to carriers, request quotes, schedule freight pickup and delivery, review information from other carriers, ensure payment intervals and terms are within reason and approved limits, and manage inbound logistics as well. A TMS can handle all these processes automatically when deployed properly.
Not every TMS is created equal. A system to request quotes and schedule freight is great, but it lacks value if developers lie down on the job. Therefore, more companies are turning to the third-party logistics providers (3PLs), like Cerasis for their TMS needs. In fact, the Cerasis Rater resides in the cloud, allowing for continuous updating and use of the latest information and freight schedules available for every order tendered. Paired with value-added services, a quality TMS can transform outbound and inbound logistics into a turnkey operation.
- Freight claims management services.
- Carrier relations.
- Inbound freight management.
- Reverse logistics.
- Freight payment processing.
- Freight auditing.
- Freight invoice consolidation.
- Freight consolidation, including one-stop and multi-stop consolidation and deconsolidation.
In a Nutshell
Deploying a 3PL is great, but deploying a 3PL-built, -managed, and -maintained TMS is even better. Working with a 3PL built strategic value and working with an outside source is integral to finding available capacity. Instead of relying on spreadsheets and in-house personnel to manage freight, simplify the process by implementing a top-quality TMS and leveraging the power of a 3PL-shipper partnership.