Shippers need a TMS to centralize operations, gain real-time visibility into shipments, reduce costs through optimized routing and carrier selection, and improve efficiency by automating tasks like rate comparison and freight tendering.
SCT works with shippers to identify the key requirements specific to their business, and scope, select, budget for, and implement the TMS to drive value across their business. Tangible results include:
- Improved freight spend and performance through carrier management and selection, optimized load planning and route efficiency
- Improved operational efficiency through automation of manual tasks
- Enhanced real-time visibility and tracking of shipments
- Clarity in international shipping status and global trade processes (though this may require multiple solutions)
- Streamlined and higher accuracy freight auditing and payment processes
The capabilities required for transportation management in a shipper environment depends heavily on the organization’s scale and complexity. It may include any combination of the following, listed in order of supply chain complexity.
- Transportation Execution – Provides real-time visibility of where shipments are, tracks carrier performance (on-time delivery, service levels), and sends alerts and initiates contingency planning if shipments are delayed.
- Planning & Optimization – Selects the best carrier, route, and mode (truckload, LTL, parcel, intermodal, ocean, air), consolidates shipments to reduce costs by applying business rules to required shipment schedules and/or inventory replenishment needs.
- Freight Audit – Automates freight bill audit and payment, ensures correct rates, accessorials, and surcharges.
- International – global trade helps businesses navigate the complexities of international commerce by automating and managing import/export processes, ensuring compliance with trade regulations, optimizing supply chain operations, and reducing associated risks and costs. These systems handle tasks such as tariff classification, customs documentation, and compliance checks, providing financial and operational visibility for international trade.
- Asset Management – Carriers or shippers with dedicated trucks or trailers. It extends the planning and execution functions to include real time GPS tracking, driver scheduling and management, mobile driver applications, and asset management.
Value in a shipper TMS environment is typically derived from optimization capabilities. International and asset management requirements embed cost and complexity into these environments, but can also amplify the value of a more robust planning system. SCT sees achievable ROI as a dependency of the level of complexity:
- Basic operations (< $60M in freight spend) see benefits from simple routing and carrier selection logic, with manual consolidation processes adding value.
- Improved tracking and reporting contribute to a typical savings of 2–5% of total freight spend.
- 10-30% savings in labor costs associated with staff productivity improvements.
- Advanced operations can see an improvement of:
- 5–15% of total freight spend leveraging optimization engines for load consolidation and route optimization as well as carrier selection
- 10-30% savings in labor costs associated with staff productivity
- Improved freight audit processes contribute to a typical savings of an additional 2–5% of total freight spend, in addition to soft benefits associated with improved carrier relationships through improved ease of doing business and expedited payment processes.
- Reduced compliance fine exposure from improved customs tracking, growing to 3-10% of global duty and tax spend if employing duty tax and optimization methods.
