Using a MultiModal SaaS TMS to Provide Flexibility & Pivot Capability

Multimodal SaaS TMS

The state of the freight market continues to change in response to the global supply chain crisis amid the novel coronavirus outbreak. According to the Department of Transportation, spot rates are up across the board, especially comparing March 2020 and the start of April 2020 to the same time in 2019. Furthermore, spot load posts have risen 39.1% in March 2020 compared to February 2020, and capacity is already at its breaking point. However, the use of software-as-a-service (SaaS) platforms, which reside in the cloud, including a transportation management system (TMS), can help. Using a multimodal SaaS TMS can provide flexibility and pivot capability for shippers and logistics service professionals (LSPs) in need of relief. To understand this potential, shippers and LSPs need to understand the challenges associated with poor flexibility and disjointed systems, how multimodal SaaS TMS capabilities add supply chain agility, and the best practices for utilizing multimodal SaaS systems to improve supply chain performance.

Challenges of Poor Flexibility and Disjointed, Legacy Systems

Take a moment to think about the problems associated with flexibility and disjointed, legacy systems in any supply chain capacity. Outdated systems rely on outdated data, and in some cases, data is not even a relevant factor. Legacy systems were built for supply chains that were increasingly linear and reliable, and the COVID-19 crisis has demonstrated that the only reliability in modern supply chain management is great uncertainty. Inflexible systems have a finite capacity. They cannot rapidly scale to meet changing demands. Disjointed systems breed problems with communication and collaboration throughout the supply chain, and supply chain efficiency inevitably suffers.

Multimodal SaaS TMS Capabilities Add Supply Chain Agility

To understand the value of multimodal SaaS TMS capabilities it is important to understand multimodal shipping. Multimodal shipping relies on a series of modes used by a given carrier to move freight. The contract remains stagnant with the shipper, but the movement of freight between modes opens the door to additional risk. At the same time, multimodal capabilities can open the doors to more capacity and lower freight rates. Multimodal SaaS TMS capabilities are naturally scalable, adapting to demand on the go, and multimodal functions are a great way to tap more carriers, which may be outsourced by your chosen carrier, more suppliers, more trade routes, and more service levels. Multimodal SaaS TMS functions build flexibility into all supply chain functions associated with any shipment that will move between modes. As a result, multimodal is rapidly changing the way shippers across the globe approach freight management.

The flexibility is clear. Successful use of multimodal capabilities has reinvigorated interest in the innovative shipping model in Europe, explains Inbound Logistics.

“Carriers continue to expand their multimodal services, leveraging favorable policy, infrastructure improvements, and emerging trade corridors where rail/barge is particularly interesting in terms of cost and speed. While there is a greater focus on rail and waterways transportation, carriers continue to upgrade their road fleets by switching to more fuel-efficient vehicles. When it comes to platforms, developers and investors are increasingly committed to provide multimodal infrastructure on site to maximize connectivity and cater to the highest number of occupiers possible. Interest is generally proportional to the maturity of the local rail freight industry.”

Best Practices for Using a Multimodal SaaS to TMS in Your Supply Chain

The best practices for utilizing multimodal SaaS TMS platforms mirror the best practices for the use of any advanced, modern system. These practices include:
  • Connecting all supply chain assets to the cloud-based TMS to provide a true, end-to-end picture of the health of your supply chain.
  • Leveraging the power of big data analytics to understand efficiencies and opportunities for improvement within multimodal shipping.
  • Diversifying your carrier and supplier base, increasing cargo space and adding value to multimodal shipping options.
  • Rating all shipments for all modes, including single mode versus multimodal, to determine the best rate that meets the needs of the shipper and customer.
  • Getting all supply chain partners to use a similar system when working with your company, implying the use of supplier and vendor portals to further increase transparency into multimodal shipping.

Become a More Responsive and Flexible Supply Chain With Multimodal SaaS TMS Deployment

A successful supply chain is flexible and responsive. Supply chain professionals have spent years dedicating research and resources to improving efficiency and lowering inventory levels, but all too often, efficiency replaced responsiveness. The use of an advanced TMS, such as a multimodal SaaS TMS, can restore responsiveness and still leverage the benefits of modern supply-chain management.
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