Transportation is an ever-growing sector of the global economy that is vital for all industries, and it has enormous potential. The main technology trend nowadays is the automation of logistics and shipping activities. Any transport company can simplify its freight operations, save time, reduce costs and improve customer services with the help of numerous technologies incorporated in logistics management solutions. The most universal solution is, perhaps, a transportation management system (TMS).
What Is TMS?
A transportation management system is enterprise software to manage the processes of the movement and storage of goods. Simply put, TMS is an integration platform that enables companies to handle and optimize all kinds of logistics operations.
Transportation management software forms a part of ERP systems and helps control the entire supply chain, dealing with both inbound (procurement) and outbound (shipping) activities. Its ultimate goals are to:
- Enhance shipment efficiency
- Provide visibility of logistics processes
- Reduce transport expenses
- Improve customer service
The flexibility of such platforms allows developers to create both logistics software for the basic shipping needs of small businesses, as well as large enterprise logistics software to handle complex transport networks.
TMS brings benefits to shippers, carriers, warehouses, manufacturers, eCommerce companies and many more users. Eventually, the system can greatly contribute to the creation of a seamless global trade network.
Statistics and Forecasts
The increasing development of digital technologies — including mobile, IoT, cloud and artificial intelligence solutions — facilitates the vigorous growth of the global TMS market. It happens because the software for the logistics industry incorporates numerous emerging technologies and provides significant business value, so more and more companies opt for its introduction. According to researchers, software for logistics management can save a company from five to ten percent in transportation spending.
The global transportation management system market is predicted to reach $30 billion by 2025. If this prediction becomes reality, the TMS market will grow at a compound rate of 13.6% between 2017 and 2025.
The diagram by Statista provides information on the revenue of the world’s leading freight transportation companies in 2017. Such results were achieved due to the implementation of management systems.
Leading freight transportation companies worldwide in 2018, based on freight revenue (in million U.S. dollars)
Deutsche Post DHL, for instance, highlights that traditionally, TMSs were accessible to large companies only because of the complexity and enormous time and money expenses required to implement the software. However, new technologies, applications and integration capabilities significantly simplify transport management platforms and make them suitable for companies of different sizes.
In June 2018, DHL compiled a logistics trend radar — the forecast diagram depicting key trends that could influence the logistics industry in the next decade.
Source: Deutsche Post DHL
Among the most influential technology trends are Big Data analytics, Internet of Things, cloud logistics, augmented reality, low-cost sensor solutions, robotics and automation, artificial intelligence, and self-driving vehicles.
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Why Create Transport Logistic Software?
Various programs for transport companies are similar in functions they perform and the benefits they can deliver.
TMS integrates with numerous enterprise systems, e.g. warehouse management system, order and purchasing management system, CRM, accounting solutions and more, enabling users to plan the most efficient transportation scenarios.
On the basis of given parameters (distance, time, cost, a minimum required the number of stops, type of cargo, etc.), TMS is able to define optimal routes, plan loading schemes and calculate the expenses.
Management systems monitor the execution of the shipment plan from point A to point B in the real-time mode. Drivers, carriers, managers and customers can access information on freight traffic, customs clearance, documents, automobile conditions, metrics, accidents, delays, etc.
When cargo is transported by several types of transport, it is necessary to maintain contact with many services (seaport, airport, customs, etc.). The system automates document processing and provides easy communication with all the participants. You can inform relevant people via TMS about the arrival time of your vehicle in advance (or warn about the delay) and automatically prepare the necessary documentation. Thus, your cargo will not have to queue up for loading or wait for shipping papers to be drawn up.
TMS uses key performance indicators (KPI), e.g. cost per mile, cost per shipping unit, delivery performance, to control service quality, analyze statistics and generate reports.
Organizations that make a trucking logistics software and correctly deploy it can reap the following benefits:
- Automation of manual processes, which means that you can handle additional workloads in less time and without hiring more employees
- Visibility of the supply chain, because all the information is integrated on a single platform, and all the participants of the shipping process can access it online and from anywhere
- Reduced expenses are possible due to the automation of numerous processes and elimination of human error
- Better quality of services is provided by the ability of programs to analyze data online, generate dynamic reports, pinpoint discrepancies and make necessary adjustments quickly without serious consequences
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The cost of transportation logistics software may be rather high, but income from the above-mentioned advantages will definitely exceed initial expenses.
Steps to Build a Logistics Management Software
The TMS market offers hundreds of ready-made solutions you can buy, deploy and instantly use. Still, they are not universal, and most companies require customization to tailor a system in accordance with their unique needs and operations. Here is a strategy on how to develop custom logistics software.
Choose a Provider
The first step of strategic importance is to choose a reliable provider. When comparing different offerings, pay attention to the following services a vendor should provide:
- Open architecture design, so it would be easy to implement new features and adopt new technologies
- Integration with multiple services that enables you to utilize the full potential of a platform
- Scalability to meet the increasing demand as your company grows
- Security levels to protect critical data from breaches
These criteria are universal but not the only ones you should consider. Other choice criteria should be based on the unique company’s needs.
To date, the leading vendors of TMS software include SAP, Oracle, Infor, Microsoft, JDA Software, Manhattan Associates and others.
|Read also: The benefits of SAP Commerce Cloud Project Development|
Choose Between Cloud and On-Prem
Logistics automation systems can be divided into two categories: on-premises and cloud-based. Software installation on local services requires significant financial investments, but many large manufacturing and distribution companies still prefer this type of hosting because of the security requirements and necessity to control servers on a daily basis.
Cloud solutions do not need additional hardware and, in this case, the initial logistics tracking software cost is much lower. Another big advantage is that all participants in the transportation process have fast and easy access to the system from any geographic location.
Again, the choice will depend on the performance needs of your organization.
Decide on Functionality
Based on the functions you want to automate, decide on the modules and tools that will be included in the system and make a draft.
Possible modules are CRM (for customer relationships), WMS (for warehouses), SCM (for supply chain), EAM (for accounting), MES (for manufacturing).
Then, professional designers and developers will work on the creation of APIs and interfaces for clients and administrators.
Build a Mobile Version
The automation of logistics processes implies that systems will generate a lot of real-time data. Accordingly, all the participants must have unlimited access to the system at any time, from any place and from any connected device to get the data, analyze it and make instant decisions.
Such a possibility can be provided, alongside cloud computing, by a mobile application. Consider developing native apps for drivers and for logistics managers to facilitate seamless transportation and better customer service.
SaM Solutions Experience in Logistics and Transportation
Among numerous software engineering projects SaM Solutions has developed, there were some solutions we completed for the transportation industry:
One project concerned the enhancement of a web application for the logistics and transportation management to comply with the ever-changing industry requirements.
The customer’s web app incorporated the full cycle of logistics operations and included transport and stock management systems, real-time transport tracking system, document control and accounting systems. Despite the fact that this advanced software came with a wide range of functions and features, it demanded ongoing enhancements to fit the ever-changing requirements of the logistics domain.
Together with the customer, our team identified what functionality could be extended and what new features could be added. The application was supposed to be capable of the following:
- Fine-grained and easy search
- Comprehensive mapping
- Multi-faceted real-time cargo tracking
- Multi-feature route management
Also, to provide a positive user experience, our team was required to further improve the application performance and its user-friendliness.
To deliver a modern trouble-proof application, SaM’s team investigated its current functionality, as well as the customer and end-user requirements. After that, specialists modified the existing software in the following way:
- Developed an advanced server-side search
- Improved the mapping functionality and its extension
- Enhanced real-time shipment displaying
- Built a feature that allows the creation and visualization of sustainable traffic routes for general cargos, based on a variety of relevant factors
- Developed new forms and controls
- Created an option that allows application tuning in accordance with various user requirements
- Customized UI control by the embedment of new configurations and by enabling grid-based sum calculations
- Optimized form and grid loading, and server methods
- Implemented new modules (scheduler, default values)
- Improved the overall application performance
As a result of our work, the customer received a scalable solution with enhanced functionality, reliable performance and improved user experience.
Another project included the development of route visualization and calculation functionality for a parcel delivery application. The customer wanted to enhance the efficiency and time of its package delivery services.
SaM Solutions’ team developed a full-fledged application that streamlines route guidance and includes the following components:
- Route visualization that provides geographical data and determines top-priority deliveries
- Route calculation that lays routes considering traffic density and transport restrictions
The cooperation with the customer lasted for four years and resulted in the development of a comprehensive route visualization and calculation functionality. These components enhanced the capabilities of the corporate delivery management system and allowed the customer to streamline navigation and optimize its parcel delivery services.
Are you interested in developing your own transportation management solution and making your business flourish? Contact us, and let’s discuss how to implement your ideas.