Transport management system has its adaptation in various parts of the business. Undoubtedly, its main functions are shipping management and providing end-to-end security for seamless delivery. It also offers various modules, from carrier management to increasing network collaboration. While 50% of the US' largest importers still use spreadsheets to manage their complex international supply chain, a TMS system helps remove these constraints. We all know how difficult the job is becoming when we need to handle volumes of data listed in endless rows. Even filtering data from one quarter takes ages before we find what we need.
Frankly, TMS is a mostly dedicated digital tool for shippers, but that doesn't mean a company should own a private fleet. Modern solutions allow carriers to access the TMS platform to be aware of incoming orders for shipping operations from stakeholders. From the side of the distribution center, a modern transportation management system can include a module for procurement management. This allows for instant transport booking from other freight forwarders or directly from carriers.
Considering that all transportation worldwide is still under constant pressure to lower costs and go further with the decarbonization of the transport sector, we see many challenges. Having in mind McKinsey's studies on the development of transport costs at real rates between 2000–2020, we see an over two-decade dropdown of nearly -0.1% based on the compound annual growth rate (CAGR) indicator. This means that rates fall rapidly, and also, with the fact that logistics costs as a share of GDP have decreased by 1 to 7 percentage points over recent decades, low profitability has made it difficult for the industry to experiment with fundamentally new solutions.
The above explains why implementing a transportation management system is so difficult, but today, we have a solution. Read more about TMS for shippers and how you can adapt your business to the challenges of constant change and lower costs.
Who are shippers and what are their types?
Shippers are the personnel in logistics, supply chain, and transportation who are responsible for booking transport. In a wider perspective, shippers are also entities that handle cargo for carriers and freight forwarders. These might be manufacturing companies, distribution centers, and all sorts of warehouses that store goods and need to ship them away.
Here, we break down how shippers are using the transportation management system:
Manufacturing сompanies
These companies produce goods and need to ship raw materials, components, and finished products. They often have complex supply chains involving multiple suppliers and customers. They may also ship large volumes of goods requiring specialized transportation. From our experience, we can share examples of companies that operate in the automotive industry, such as manufacturers, food processing plants, and electronics producers.
Distribution сenters
Here, we consider all facilities that store and distribute goods to retailers, wholesalers, or consumers. Most likely, they play a crucial role in the supply chain, ensuring the timely delivery of products. It is also worth mentioning that they often handle high volumes of shipments and require efficient logistics operations. We know many examples of retailers, but Amazon fulfillment centers, retail distribution hubs, or third-party logistics (3PL) warehouses are the most well-known. The last one can be even companies like UPS SCS, which handles warehouse distribution for external customers.
Warehouses
The application of TMS can be very broad. This category encompasses many storage facilities, including public warehouses offering storage and distribution services to multiple clients. The other side can include private warehouses, which might be owned and operated by a single company for its use. Another example is bonded warehouses. In this kind, they store imported goods until customs duties are paid. We cannot miss the cold chain, where companies have cold storage warehouses specializing in temperature-controlled goods. It also reveals quite an important function of the TMS system, which can also help select the carriers that can provide a cooling system in the trailers (quite important for perishable goods).
Any moving goods businesses
We cannot close up all of the above because a much broader number of companies can utilize the transportation management system. This category includes retailers who ship goods from suppliers to stores or customers. Moreover, it is crucial to say that it is also about eСommerce businesses, where we ship products to customers worldwide. We need to mention wholesalers distributing goods to retailers and other businesses. Other might be construction companies, agricultural businesses, and mining companies that ship raw materials. Even small businesses can ship only a few packages a week.
TMS shipping: what are the main modules?
The freight sector is experiencing tough times as of 2025. The overall impact of the war in Ukraine and the post-COVID-19 effects of a resurgent global economy have been reported very visibly. While global real GDP grew by 3.2%, indicating further recovery from the pandemic, we have seen that nuances in the freight industry revealed a more mixed picture. Global trade volumes contracted by 1.2%, and air freight recorded a 1.9% year-on-year decline in ton-miles. Although the air freight market showed signs of recovery from April 2022. Surface transportation showed divergence between regions: The European Union (EU27) saw declines in both rail (6.6%) and road (2.8%), while the US showed the opposite trend, with a 6.6% increase in road transport despite a 2.6% decline in rail transport.
It gives a picture of a sector adapting to changing global trade patterns and regional economic differences. In these times, a transportation management system should be more flexible to help companies better adapt to circumstances that can affect profitability.
Over the last decade, we have worked with companies in the transportation sector, seeking a single solution for their operations. We had requests to build a truck owners' mobile app, a procurement system to replace Excel spreadsheets, and a document shipping platform for any kind of document generation required in the supply chain. So, each company has requirements for a particular TMS module from us. It suggests that a modern TMS system should be modular and allow companies to be agile while not jeopardizing investment budgets.
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Explore moreHere are the core modules of the TMS system for shippers:
Order management system. This module handles the entry and management of shipping orders. It integrates with other systems, such as ERPs and warehouse management systems (WMS), to ensure accurate order information. OM provides visibility into the order lifecycle, from placement to fulfillment.
Transportation planning and optimization. This critical module focuses on optimizing shipping routes, carrier selection, and load planning consolidation. It helps shippers find the most efficient and cost-effective ways to move their goods and save money.
Carrier and fleet management. Here, we have a module that facilitates the selection, management, and communication with carriers. Carrier management stores carrier information, tracks performance, and manages contracts. It enables shippers to evaluate carrier contract rates and service levels. So, you get from TMS directly a module for fleet management, which helps you send trucks and trailers for all sorts of transportation modes. You can choose intermodal as the best transportation mode to run your own fleet management's streamlined operations end-to-end.
Freight execution. Shipping teams in OSG, such as the Operation Support Group, need this module to execute shipping plans, including tendering loads to carriers and tracking shipments. It provides real-time visibility into shipment status and allows for proactive exception management.
Freight settlement. We came up with this module to handle the financial aspects of shipping, including automated freight auditing, payment, and invoicing. It is crucial to mention that it ensures accurate billing and helps shippers control shipping and transportation costs as a whole.
Tracking and visibility. The TMS system provides real-time tracking of shipments and enables shippers to monitor their progress. The module offers visibility into shipment information, location, and estimated delivery times. So, shipment tracking from centralized platforms also has huge cost-saving opportunities.
Transportation data. Frankly, this is the most important module for business intelligence. It provides insights into shipping performance through reports and dashboards. It helps shippers identify areas for improvement and make data-driven decisions.
Dock scheduling. This part of TMS manages the scheduling of trucks and deliveries at warehouse docks.
Yard management. Here, TMS provides visibility and control over the movement of trailers and containers within a yard.
Compliance management. This module ensures compliance with shipping regulations and documentation requirements, whether for HACCP control or 5S.
Benefits of TMS systems for shippers: get your competitive advantage
According to PWC, more than 54% of companies expect to grow revenue from digital technology investments, while 16% expect an increase in profits, and 11% believe in creating better customer experiences. Percentage of respondents who marked the reply in the 2017 Digital IQ Survey (T&L industry).
Here's how those points translate into concrete benefits of implementing a TMS system, focusing on the advantages for businesses:
Transportation costs reduction
A TMS enables businesses to capitalize on lower costs associated with new trade routes. This is particularly true for those with initiatives like the "Belt and Road”. By optimizing routes and carrier selection, we are sure that companies can directly benefit from reduced transportation expenses.
More modernized infrastructure
TMS systems seamlessly adapt to and leverage modernized infrastructure (railways, highways, telecommunications). This means faster and more reliable shipping. Companies can undoubtedly expect fewer delays and improved operational efficiency.
Expanded market access and growth
TMS helps businesses overcome logistical barriers that previously restricted direct access to new markets. It is all about reducing logistics costs. A TMS makes previously unprofitable areas viable and can open up new directions for growth and expansion.
Better contracting strategies
TMS provides the flexibility to quickly adjust supply chain strategies in response to new trade agreements. It allows businesses to maximize profitability. So, companies can present them as those that can plan more efficiently, for example, to plan better shipment routing (using better corridors).
Scalability for emerging
TMS enables businesses to handle increased trade volumes effectively in emerging markets. Its scalable architecture supports the growth of daily operations. Moreover, a TMS allows for the delivery of services on a larger scale. TMS can also integrate with a warehouse management system to align better carrier performance seen as transportation processes with inventory management. This all helps manage better logistics operations.
Optimized supply chain
Time and cost are the main reasons for TMS implementation. A TMS empowers businesses to proactively adjust their supply chain strategies. It is all about taking advantage of decreasing costs and delivery times. Companies can provide real-time data and analytics, which allows for informed decision-making and continuous improvement.
Is transportation management software right for small business?
It should be noted that the logistics sector is undergoing a significant digital transformation. Significant investments in logistics startups are evidence of this. An analysis of more than 120 major logistics startups shows that they account for about 93 percent (about $26 billion) of total logistics startup funding. This funding is mostly from early- and late-stage venture capital, with some mature startups attracting private equity. This shows that SMBs can afford to implement TMS, which can turn back into higher revenues, and the possibility of acquiring funds is also opening a new window.
This trend indicates that logistics technology solutions, including TMS, are becoming increasingly important to companies of all sizes. The availability of cloud-based TMS platforms and broader investment in logistics innovation make it an attractive option for small shippers companies looking to optimize their shipping streamline operations.
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Explore moreFinale takeaway
A transportation management system (TMS) is now available for shippers of all sizes, from manufacturing giants to small e-commerce companies. The ability to route optimization, manage carriers, and gain real-time visibility into shipments is critical to maintaining a competitive edge.
Don't let outdated spreadsheets and manual transportation processes hold your shipping transportation operations back. Discover how modern transportation management software can transform your business today. Explore our comprehensive guide on how to get on a journey with a custom software development partner. Let's make a call and see how we can improve your business.