Transportation management systems (TMS) are centralized platforms in which all participants in the supply chain interact to execute the transportation and distribution process. End-users of TMS include shippers, carriers, warehouse managers, shipping yard laborers, freight brokers, transportation intermediaries, and supply chain managers. TMS is legacy software that may not provide the more advanced features found in platforms such as warehouse management software or supply chain visibility software. To address this, TMS often integrates with other SaaS products to access advanced software features, such as predictive tracking analytics, inventory control, or forecasting shipment volumes.
TMS is also designed to integrate with procurement software and shipping software to evaluate both inbound and outbound orders and suggest multiple transportation solutions to the user before selecting the best method and most affordable provider. TMS provides electronic load tendering and communication tools for choosing between potential carriers. Finally, TMS implements shipment tracking and tracing to deliver the optimum shipment with the chosen carrier and provides freight audit and payment settlement.
TMS is, however, limited in its tracking and tracing functionalities, as it relies on data directly entered into the system. However, a company outsourcing certain operations to third-party logistics providers would have difficulties getting a 360-degree view of moving materials since third-party logistics providers use their own systems and databases. This predicament is solved by integrating supply chain visibility software into the TMS. Visibility platforms use APIs to consolidate data from all parties involved in the supply chain from the first to last mile to track raw materials and finished goods.
To qualify for inclusion in the Transportation Management Systems (TMS) category, a product must:
- Manage multimodal shipping types such as air, ocean, and rail
- Support transportation modes such as parcel, truckload (TL), and less-than-truckload (LTL)
- Deliver yard management and dock scheduling features
- Provide features for load planning, optimization, and/or boarding
- Allow users to evaluate various carrier options for each delivery as well as optimize freight management and costs
- Monitor shipping status and track deliveries
- Manage relationships with carriers and their performance
- Store documents related to transportation, such as bills of lading
- Contain financial modules to manage payments and store purchasing records
