Transportation Management - FAQ

TMS - Benefits

2023 Global Transportation Management Benchmark Report

Descartes conducts annual benchmark research among global transportation professionals. The 2023 study reveals that higher (fuel) costs and a shortage of drivers pose challenges, while investments in visibility present opportunities.

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Benefits of a TMS

Why do I need a transportation management system?

A transportation management system plays a central role in the total supply chain. It is a powerful tool that enables businesses to automate activities like carrier selection or invoice audit, gain control over costs, a better visibility on their logistics processes, which will result in lower costs and higher customer satisfaction. It can provide you with a competitive advantage by enabling you to have lower costs per order/transport and meet customer demands more effectively and efficiently.

What type of companies would benefit from a TMS?

How much value a TMS can provide to your business depends on several factors such as the size of your business, the complexity of your supply chain, the number of shipments you handle, and your transportation needs.

If your business involves managing a significant volume of shipments (1000+ per year) across multiple locations or countries, a TMS is an essential tool to help you to manage your transportation operations more efficiently, reduce costs, and improve customer satisfaction.

A TMS can be particularly beneficial for businesses that:

  • Have complex transportation requirements:
  • Need real-time visibility into their supply
  • Want to improve customer satisfaction.
  • However, if your business has relatively simple transportation needs or a low volume of shipments (less than one thousand per year), a TMS may not be necessary.

How can a TMS help improve the supply chain efficiency?

A transportation management system (TMS) can significantly improve your supply chain by providing more efficient and effective transportation management, which is a critical part of any supply chain.
A TMS can help you to optimize your transportation operations, improve visibility, reduce costs, improve customer service, help with collaboration, and increase the accuracy of your data. By improving your transportation management, you can improve the efficiency and effectiveness of your supply chain.

Why should Transportation management be an important component of my digitization strategy?

Transportation management should be an important component of your digitization strategy for several reasons:

Cost savings
A TMS can help you to optimize your transportation operations, reducing transportation costs and avoiding unnecessary expenses. By automating tasks and improving efficiency, you can minimize manual errors, save time, and reduce the need for costly expedited shipping

Improved efficiency
A digital transportation management automates manual processes, reduces paperwork and improve a company’s overall efficiency. This will save time, reduce errors and lower costs.

Enhanced visibility
A TMS provides real-time tracking of shipments and visibility into the entire supply chain. This helps to identify eventual bottlenecks and will improve your customer service.

A TMS can optimize routes and the use of different transportation modes within an organization. This ensures that shipments are delivered on time and at the lowest cost. This will result in a reduction of transportation spending and a higher sustainability.

A TMS can integrate with other systems such as Warehouse Management Systems (WMS), accounting systems, customs solutions, etc. This provides an end-to-end visibility and a seamless flow of information throughout an organization’s supply chain.

A digital TMS can be scaled up or down with your business, according to changes in demand. This allows you to quickly onboard new carriers, customers and suppliers.

What is the added value of a TMS for my business?

A Transportation Management System (TMS) provides many benefits to businesses. Here you can find the key added value it can bring businesses in general:

• A 5-10 % cost reduction of the transportation budget;
• More effective supply chain processes across regions, modes and carriers;
• Automation of business operations for faster and more accurate billing and documentation;
• Better visibility of your transportation processes, and supply chain in general.
• More effective time management – fewer manual steps result in fewer delays and more accurate delivery times;
• The ability to track freight, locally and globally, on one single platform;
• Better import and export compliance minimizing penalties and shipment delays;
• Improved business insights due to better reporting results in less waiting time and process improvement;
• Increased customer service and customer satisfaction with real-time updates and fewer shipment delays.

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