8 Key TMS Capabilities to Optimize Transportation and Reduce Costs

Selecting the "best fit" for unique company needs is just as critical as having a Transportation Management System (TMS) to facilitate the smooth and efficient transfer of goods.

Digital transportation management is growing crucial as consumers' demands grow more complex and convenience-driven and companies strive to cut expenses for better bottom lines.

However, how can companies determine which TMS best suits their needs, and which features are absolutely essential?

In this article, we address these and similar concerns to ensure that you select a TMS that meets your needs. And If you want Transportation management system software development services, you can get in touch with us.

The Significance of a TMS and What Is It?

The logistics of transportation, including suppliers, invoices, vehicle tracking, communication, transactions, and more, can be better managed with the use of a Transportation Management System, or TMS. While the fundamentals are the same, TMS solutions come with a wide range of options for reporting and analytics, order management, payment gateway connection, and more.

It aids companies in resolving major transportation issues, which in turn improves supply chain visibility, customer service, and costs. Critical characteristics offered by transportation management software include process automation, route optimization, and real-time insight provision.

8 Modern TMS Essential Capabilities: How to Choose the Best One for Your Company

#1 – Comprehensive Vendor Management

Through the use of a unified platform for comprehensive vendor-related process management, a strong Transportation Management System simplifies vendor management.

Modern features like vendor portals make it easier to work with numerous suppliers, speed up the onboarding process, and provide companies more control over which vendors are most suited for particular shipments in terms of serviceability, pricing, and performance history, among other criteria.

In sum, vendor management modules promote improved connections and cost-efficient sourcing by ensuring effective coordination with vendors from procurement to order fulfillment.

#2 – Seamless Indent Management

Automation of the business processes involved in establishing, tracking, and closing indents is a feature of transportation management systems that makes them easier to use.

Companies may simply import vendor lists that include available regions, vehicle capacities, serviceability data, rate contracts, and more.

Based on shipment and business needs, they might establish particular criteria for selecting and prioritizing vendors. Saving time and effort compared to manual indenting is possible because the software handles all the stages.

#3 – Real-Time Tracking 

A Transportation Management System's capacity to monitor cars in real-time is among its most important features. Several methods exist for this purpose, including GPS tracking, SIM-based tracking, and others. Delays are minimized and the whereabouts of the fleet may be seen with the help of real-time vehicle tracking.

In addition to improving logistics efficiency generally, it allows for proactive decision-making, aids in route optimization, and guarantees on-time deliveries.

Anyone who needs to know, such end users, hub managers, etc., may get real-time shipment tracking information.

#4 – Unified Communication

Shippers, carriers, and recipients can all communicate through a single platform provided by transportation management systems. In addition to simplifying data sharing, it guarantees that all parties involved have real-time access to crucial information like order updates, delivery timetables, and inventory levels.

This facilitates easy cooperation across intricate transportation networks, lessens dependence on manual and individual communication, and helps prevent misunderstandings.

#5 – Dispatch Planning and Route Optimization

A modern TMS must also have the capability of efficient dispatch planning. To ensure efficient and cost-effective dispatching, a transportation management system provides extensive functions to optimize routes, assign orders to appropriate carriers, and schedule pickups and deliveries.

The built-in route optimizers of modern transportation management systems allow for the creation of extremely efficient routes while also reducing transportation costs.

Management of fleets, consolidation of loads, and the establishment of an optimal vehicle mix according to company needs and preferences are all features of transportation management systems. Transportation expenses can be optimized and reduced in this way. It is possible for managers to design the best loading sequences and route designs.

#6 – Effortless Carrier Execution

Transportation management systems streamline carrier execution with built-in operational workflows for each activity, including vendor indenting, 3PL booking, electronic proof of delivery (e-PoD) and electronic lorry receipt (e-LR), and live cargo tracking.

Whenever necessary, transportation managers can obtain data pertaining to receipts, delivery proofs, and indents, and they can view all vital information in real-time.

#7 – Performance Management and Analytics

The ability to establish and monitor key performance indicators (KPIs) for the purpose of analyzing the performance of individual carriers and drivers is an integral part of smart transportation management systems. Deprioritizing vendors/carriers with poor performance amplifies total field productivity and eliminates inefficiencies.

Transportation optimization based on trends and business insights can be achieved with the help of advanced transportation management software's reporting and analytics features, which provide business intelligence to managers.

#8 – Freight Audit

The ability to automatically produce invoices is another essential feature for transportation management systems. This feature ensures secure transaction administration, penalty calculations, audits, and more.

The whole transportation ecosystem benefits from digital freight audits because they promote transparency and confidence. By automatically comparing carrier bills to the agreed-upon prices and terms, any inconsistencies or overcharges can be eliminated, resulting in accurate financial reconciliation and cost savings.