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CHOOSING THE IDEAL TMS SOLUTION If a new TMS is in your future, here are some factors to consider.
ransportation management solutions (TMS) are getting a lot of attention these days as companies look for ways to optimize their delivery networks and get control over rising freight costs. It’s a good time to be evaluating new solutions. New technologies and new vendors have given TMS systems a serious overhaul in terms of usability, configurability, deployment, and the total cost of ownership (TCO). However, as many shippers have learned, identifying the best TMS solution for their specific industry and operations can be daunting. A quick search on the internet shows dozens of TMS systems offering a wide range of functionality from the planning of small parcel shipments to booking ocean freight and everything in between. Not surprisingly, honing in on the right solution takes time. Following are some thoughts to keep in mind: SHIPMENT PLANNING Some TMS systems are built for multi-modal planning while others focus on one or two modes, so it’s important
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to vet each solution and the depth of functionality it truly delivers in the modes you use most. It should be built by logistics technology experts who have in-depth experience working with companies who match your shipping profile. For companies who primarily ship via LTL, truckload, rail, and/or ocean freight, a multi-modal TMS planning system is often the best choice, deployed upstream of the WMS system. However, for companies who predominantly ship small parcel freight, a better planning solution may be a robust shipping execution system that dynamically optimizes the shipments during execution after they’re received from the WMS system. The best systems include tools for shipment consolidation and the comparison of postal, small parcel, LTL, and regional carriers for lowest-cost delivery. When executed well, you should expect your TMS to yield significant savings and a measurable ROI. Small parcel freight savings of up to 40% can be uncovered when shippers can compare small parcel carrier rates to the USPS and regional or local carriers.
SHIPMENT EXECUTION Once the plan is set, what does the TMS solution offer to automate shipment execution and processing? This functionality crosses over from planning and into operations, but it should be a requirement because it can yield significant savings by eliminating manual shipping procedures. The system should offer a library of carrier-compliant shipping labels, carton contents labels, packing lists, advanced shipment notifications (ASNs), and other documents required by your trading partners. When automated label and document generation is well-integrated into the fulfillment workflow, the labor savings can be tremendous. CARRIER INTEGRATION How are carrier rates and services managed by the TMS system? Has the vendor already onboarded the carriers you use into its system and, if so, how are rates, services, and updates handled? How are surcharges managed so that they can be included during planning and not show up as unexpected costs on the freight bill? Which other carriers does the TMS vendor work with? If, for example,