More shippers are looking for innovative and reliable ways to boost overall performance and preserve quality services across all functions and niche markets. TMS software price has proven to be an intelligent investment for any company involved in shipping, transportation services, freight market management, and freight forwarding.
A Gartner study found that companies spending around $100 million in freight transport costs had only 50% adoption of TMS software platforms. Likewise, companies spending between $25 million and $100 million had 25% use of transport management systems. And for companies spending less than $25 million on freight costs, less than 10% used a transportation management system.
This means only 35–40% of logistics teams have freight and shipping software in place for their business.
With so much untapped potential, a greater focus is needed on transportation management and monitoring system capabilities. That kind of focus on TMS capabilities and features follows here.
Extending the Scope of Your Transportation Management
No matter the company’s size, where its current freight transport spends, and investment levels fall, it is possible to extend your supply chain visibility and control.
1. Vehicle Routing and Scheduling for Greater Productivity
An ARC Advisory Group strategic report on the ROI of TMS found that shipping companies that use TMS applications for routing and scheduling reported freight savings of approximately 8%. And like everything else involved with supply chain and modern logistics strategies, there is always room for improvement.
2. Multi-Modal Optimization Boosts Overall Profits and Savings
Many modern transportation management systems are multi-modal and designed to optimize services and boost profits and savings across the supply chain.
InTek Freight and Logistics highlighted this by showing that “a company can save between 2% to 5% on operating costs when using a TMS. The 2% to 5% seems insignificant, but when thinking about the operational savings, this is across all functional units, not just the freight department.”
In addition, investments are improved when every step involved in the multi-modal shipping and final mile delivery is optimized, a selling point mentioned in any TMS buyer’s guide.
3. Modeling and Simulation to Improve Predictive Planning
A unique factor of modern TMS software is the ability of shippers and LSPs to run “what if” scenarios and utilize predictive planning to look ahead for potential highs and lows in the supply chain market.
As the number of manufacturers outsourcing their shipping needs continues to grow, so does the demand for improved software TMS options. Statista reports show growth within the shipping and transportation industry for 2021, and the estimated market revenue was US$264.7 billion, which is significant for the industry.
4. Intelligence and Analytics to Improve Adaptability and Scalability
Utilizing a transportation management system and modern technology improves business intelligence and visibility. According to IBIS World’s freight and logistics market trends report, “Overall, industry revenue has increased at an annualized rate of 1.3% to $3.2 billion over the five years to 2022. This includes an expected 5.0% increase in 2022 alone.”
With improved adaptability and scalability, companies can better prepare for the future with transportation management solutions.
See the TMS Extended Capabilities Now With our TMS Buyer’s Guide
Getting the best transportation management system and ensuring it is utilized efficiently is the goal of our MercuryGate TMS software buyer’s guide.