A transport management system or TMS is a specialized software designed for the shipment of goods, performed by the following processes:
The users work on three main tasks in the TMS, such as:
- Find and compare prices and services of the carriers for shipping orders
- Book the shipment
- Track the movement of delivery
When you are running a transport service and want to make sure that you and your customers can monitor the delivery process, a TMS can be of great use.
The goals of TMS
TMS improves the shipping efficiency with the following goals:
- Protects goods on transport
- Reduce the costs
- Gain real real-time visibility of supply chain
- Guarantees customer satisfaction
Carries and shippers are the initial users of the TMS software. Major users of this transport management system software are:
- E-commerce organization
- Third-party logistics providers
In today’s supply chain management, the TMS plays a major role as one of the core technologies used. It is a discipline that encompasses the SCE or supply chain execution and SCP or Supply Chain Planning. The software is available as a standalone software within ERP (enterprise resource planning) and SCM suites.
Some TMSs focus on single transportation, while other systems assist those modes of transportation: intermodal and multimodal transportation.
- Multimodal transportation. A single carrier uses a minimum of two modes of transportation: rail, truck, air, or sea. It is legally liable to meet the terms of the contract, although it might hire subcarriers.
- Intermodal transportation. It refers to the shipments that require two to more carriers and contracts. Intermodal transportation gives the shippers control over the carriers, rates of service, and modes of transportation. But, it makes them more responsible for the management of the work.
How does TMS work?
Initially, a TMS is a detailed information repository about carriers. But, it is a communication system and transactional allowing the users to plan, execute, and track the shipments. Doing all these things is possible using a strong integration with data sources and carrier systems. It can also be downloadable where all the information of the carrier is accessible. It facilitates entry of the customer orders specifying what will be shipped.
Usually, some orders are automatically from enterprise resource planning or order management systems; both integrated with the TMS. The TMS often be incorporated with the warehouse management system. It allows better coordination of the tasks, which is occurred within the warehouse interface and freight shippers for the following tasks: