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AdexinBlogHow to find the best transport management system provider?

How to find the best transport management system provider?

Nov 22, 2023
5 min

Summary

How to find the best TMS? This is a commonly asked question; even mature logistics and transportation companies can encounter this issue before selecting a Transport Management System (TMS). This is due to the huge saturation of TMS providers in the market and the complexity of the industry. Management and engineers need to evaluate various aspects and consider different scenarios where TMS can provide the desired value. You can find yourself in a position where we must weigh the pros and cons to avoid issues with a poor service provider and an uncomfortable service agreement. Let's explore how to select, evaluate, and determine the best-in-class TMS.

Selection and evaluation of intelligent traffic systems companies for logistics

The major challenge is to map all areas of your business to determine what will work best for you. This requires in-depth internal research, examining your company for any weak points, and identifying areas that need attention when it comes to shipping. This is a simple but often overlooked type of communication. Very often, decisions are taken top-bottom without the personnel inside the warehouse and the truck drivers who keep a hands-on shipment process. 

Starting with this crucial tip, we have also highlighted several key points that are significant throughout the entire process. Here, we've outlined a fundamental approach for selecting a TMS, your intelligent traffic system:

Examine the challenges that a new TMS should address:

Define criteria

Precisely define all the criteria that are important today and could become crucial in the future. This should cover aspects such as managing inbound cargo outbound logistics, minimizing supply chain risks, handling returns, and more.

System features

After mapping your business, move to analyzing the key features of the system. This may first involve determining the business model you wish to adopt, whether a traditional terminal-based platform, a SaaS system, or custom development with on-premises installation.

Evaluate integration

Don't forget to assess integration capabilities. If you already use specific systems, you may want to connect them all for a holistic view. This is often the best scenario to save a lot of time in the future, but is frequently overlooked.

Review the market offer

Review the software vendors' offerings and collect references. It's important to choose companies that have expertise in the transportation industry. It's common today for companies to commit to various projects without truly understanding the industry.

Consider upgrades

Consider the potential for system upgrades and available support. The transportation industry is constantly changing, with new features and technologies in high demand. You may want a software developer who can ensure you with ongoing support.

Training point

Plan the process of training employees to use the system effectively. Your personnel may be used to a completely different interface and features, and they may feel overwhelmed by new capabilities. It's important to provide good training along with technical instructions and tutorials.

How many companies use TMS?

It's no secret that the largest companies in transportation and logistics use TMS systems. Most of these companies are quite large, and they can't handle all the data using decentralized, non-integrated resources. Due to market saturation, even small companies can benefit from functional TMS systems. The availability of solutions in the market makes TMS easier to obtain, but at this point, everything revolves around quality and solution deliverability.

The estimated number of companies using TMS can be as vast as the number of logistics and transportation companies. North America led the global transportation management systems market in 2021, reaching a revenue share of over 30%, and is projected to remain dominant throughout the next forecast period. This gives us a strong perspective on the number of companies using TMS. [1]

We believe that companies obligated to perform specific business operations are most likely to use TMS. Here are the most popular operations performed by TMS: 

  • Planning transportation 

  • Transport procurement

  • Transportation management for trucks, trains, planes, and ships

  • Real-time transportation tracking

  • KPIs for tracking service quality and analytics 

  • Load and route optimization

  • Transportation costs and plan model

  • Freight audits

It's also important to highlight the types of companies that use TMS. Here are some of the industries that are utilizing highly advanced TMS:

  • Manufacturers

  • Distributors

  • Retail businesses and e-commerce

  • 3PL and 4PL companies and logistics service providers (LSPs)

What makes TMS different?

TMS offers specific features for fleet management. In many situations, you can obtain basic TMS features from a typical off-the-shelf solution. However, what sets TMS apart are not only additional features but also the extended functionality of certain basic features. This means that one solution can have many variations.

For example, the TMS interface and dashboards in an off-the-shelf solution may not cover everything you expect. There could be obstacles or limitations. You might lack the necessary buttons to perform specific tasks quickly, or the button placement could lead to errors if you click the wrong one.

An off-the-shelf TMS solution is essentially pre-made software that is difficult to modify due to minimal or no support from developers. Therefore, it's often best to consider custom software development, where you can tailor the solution to your specific needs. If button placement makes your interface challenging to use, they can be changed as per your request. Custom development services also offer various development options, such as Minimum Viable Product (MVP), which can protect you against an unwanted solution in the long term. In that way,  you can also benefit from various methods of document management and exceptionally flexible document workflows.

Best TMS systems in-class

There are different topics about what makes TMS better than others. The fact is that, as already stated, you can choose a ready-made solution or go along with customized software development. Below, we mention the benefits you can gain with custom software development, as this is the path that helps you stay ahead in the transportation industry. Only a customized solution can truly fit your business needs because, despite many similarities, there is always a significant degree of diversity.

Here is how you can benefit from custom software development to get a best-in-class TMS system:

Customization

Customized TMS offers solutions that exactly fit your project specifications. This exclusive software can give you a competitive edge and set you apart in your field.

Cost-effectiveness

Custom TMS software, which initially appeared more expensive, avoids the recurring expenses and hidden costs associated with off-the-shelf software.

High security and reliability

Custom TMS software meets high security and compliance standards while making it ideal for industries in the supply chain.

Continuous support and maintenance

Dedicated development teams provide efficient support and updates for custom TMS software. You can maximize that value and minimize risk.

Flexibility and scalability

Custom TMS software adapts to changing business needs. You can benefit from flexibility and scalability for future needs.

Seamless integration

Custom TMS solutions integrate seamlessly with existing systems and processes. When choosing custom software development, you rely on the expert's knowledge that is easy to reach at any time. You can improve data management and make more informed decisions.

Increased productivity

Custom TMS software streamlines operations and, at the same time, increases productivity. Your employees can manage multiple tasks simultaneously.

A quick review of top TMS systems

It's enough to look at the Gartner Magic Quadrant for TMS providers to identify industry leaders. But the real question is, how deeply do they integrate with the entire industry? Can the best service providers truly cater to your business needs? The answer is often no. Even when you contact a big TMS system provider, you might end up with very generic functions. 

This can be disappointing, as you'll need to initiate change requests, typically detailed in a Statement of Work (SoW). It happens often whenever something doesn't work in your TMS. This is a significant disadvantage of working with large TMS system providers. Additionally, due to your Service Level Agreement (SLA), you might be stuck for the next five years with incompatible solutions. 

This quick review highlights another benefit of collaborating with a custom software development company. Choosing this path is a solid approach to acquiring a top TMS system.

Custom TMS software development can be the top choice for:

  • Small and medium-sized carriers

  • Manufacturers

  • Wholesalers

  • Distributors

  • E-commerce businesses

  • Retailers

  • Freight brokers

  • 3PLs

Total Supply chain control with logistic TMS

Supply Chain combines various elements that TMS can manage. In the long run, TMS can provide you with total control in the four main areas highly important for the supply chain. Here are the areas where TMS influences operations at the supply chain level:

• Optimize transportation logistics and daily transportation operations;

• Simplify document flow;

• Monitor compliance with trade agreements and requirements;

• Ensure timely delivery of goods.

TMS platform for your transportation

TMS can function as a platform that integrates surrounding systems into operations. Whether you use separate systems for tasks like invoicing or reporting (such as Crystal Reports), you can connect these various functionalities to your TMS. The extent of integration depends on the customization level of your solution. Generally, a more customized solution will offer extended integration capabilities and access to more comprehensive transport management solutions.

Key features of the TMS platform include:

Data

A custom-developed TMS platform offers flexible data import and export tailored to your evolving business needs.

Integration

Custom TMS software supports out-of-the-box integration with common systems and third-party tools through open APIs. You can also build interfaces to connect with freight service providers.

UI Workflows

TMS platforms empower customization, creating an easy-to-navigate control panel that seamlessly integrates into workflows and tools like CRM. This flexibility is achieved through custom development.

Business Logic

While transportation processes remain similar, with custom development for a TMS platform, you can enable custom business logic to match specific needs.

Developer Ecosystem

TMS software, based on custom development, enables rapid customization, development, and deployment.

Quick summary

When making the right choice for TMS, one thing becomes clear with the knowledge in hand. Opting for a custom software development company is the best choice. However, to stay objective, you can still go for a Commercial Off-The-Shelf (COTS) solution for your TMS and find what you need.

Nevertheless, given the complexity of software providers and the transportation industry, major obstacles may arise in the future. So, there's always some compromise required.

It's worth noting that the best and most responsible choice for a TMS provider could be a company with a proven track record of implementations and a long-standing presence in the market.

Adexin has been providing solutions for the transportation industry.. We have had enough time to understand the transportation industry and find affordable solutions to deliver a return on investment (ROI) for your business. Contact us today, and let's see what we can do for your business.

References:

[1] Transportation Management System Market Insights – 2027; https://www.alliedmarketresearch.com/transportation-management-market-A06268

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FAQ

What are the challenges in selecting a TMS provider?

Selecting a transportation management system (TMS) vendor can be difficult due to market saturation and industry complexity.

What are the key factors in evaluating a TMS system?

Consider the challenges a TMS should address, define criteria, analyze features, evaluate integration, review software vendors, etc.

Who uses TMS systems and in which industries?

TMS systems are used in a variety of industries, including manufacturing, logistics, retail and more. The number of users is significant, with North America leading the market.

What differentiates TMS from off-the-shelf solutions?

TMS offers specialized fleet management functions and is limited by development capabilities.

Why opt for custom software for TMS?

A custom TMS offers customizations, cost efficiency, security, support, flexibility, seamless integration and increased productivity. It provides the perfect fit for your business needs.

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