4 Must-Have Features for Transportation Management Software for Parcel Shipping

Manage Multiple Carriers, Reduce Shipping Costs and Improving On-Time Delivery Percentages

Selecting a Transportation Management System (TMS) can be complicated.

The marketplace is crowded with various TMS vendors, all of whom promise – and most of whom deliver – significant efficiency gains.

With such a loud din of competing voices from solution providers, it’s easy to feel overwhelmed.

Keep it Simple

First and foremost, keep it simple. When you’re researching TMS technology products, remember that if 60-70% of your shipment volumes are parcel, you need a TMS for parcel shipping.  This means you’re looking for technology that can:

• Easily identify best value carriers and streamline carrier contract management to reduce shipping costs
• Efficiently utilize and manage the best carriers to meet daily operational needs
• Instantly access comprehensive, proactive shipping information to communicate with customers
• Enable a seamless, “touch-free” transportation flow from transportation booking to carrier invoice payment

To yield quick ROI, your TMS for parcel shipping technology should have these four essential features:

Rate Engine

If you ask your Procurement team to analyze the impact of a fuel increase on transportation costs, they’ll probably create a spreadsheet, complete with an elaborate web of pivot tables. 

Great transportation management technology takes the exercise out of excel and moves it to a rate engine where transportation procurement teams can quickly simulate “what if scenarios” and generate the data they need to make smart decisions. The fancy, complex stuff all takes place behind the scenes.

Even better? The same rate engine allows procurement teams to contract with the right carriers for your business, based on factors such as price, capacity, service, and quality. The ideal solution will feature a user-friendly dashboard of real-time carrier data that makes it easy to identify the right mix of carriers to drive the lowest possible shipping costs while protecting service levels.

And be sure to look for features that include automated tendering, spot quoting and freight contract compliance, so you can build an efficient ecosystem between all parties in the shipping cycle to create predictable shipping costs and increase overall savings.

Automated Carrier Selection

Ideally, your transportation management technology will be your one-stop shop for order fulfillment in your organization, which means those carrier-specific workstations on your warehouse floor will be unnecessary.

Carrier selection for each shipment will take place automatically in a single solution, and the technology will account for best value rates, your business rules, and customer delivery preferences with each order.

Ideally, your solution will also integrate with WMS, ERP and larger planning systems to create a “one-touch” shipping system.  It will generate all necessary paperwork – carrier labels, End of Day manifests and CMRs – at the point an order is picked, reducing manual labor and yielding significant improvements in productivity.

Control Tower

Lots of transportation management systems will have a control tower, but if you’re serious about achieving new levels of productivity in parcel shipping, you’re going to need a control tower with AI.

A robust control tower with AI will not only give you real-time visibility into transportation movements worldwide, but it will also create smart exception workflows to enable automatic responses to transportation “exception events,” such as a shipment delay.

You should also make sure real-time carrier performance monitoring and exception trend analyses reporting are “baked in” to your solution so you can improve ongoing carrier selection and rate negotiations.

Automated Carrier Invoice Matching and Payment

One of the reasons why a transportation management system for parcel shipping is vital for your business is that you never need to push it.  As soon as you begin a new shipment, the transportation flow runs until finish without anyone needing to chase after a task.

An important activity in completing this flow is automated freight bill auditing. By running dedicated audits on all carrier invoices and automatically matching shipment data with invoice data, you can verify invoice accuracy before issuing payment and find potential savings. Important note: if you find a solution that can automatically allocate costs down to the SKU level, you’ll reduce the workload in your accounting and finance departments and improve cost accounting accuracy.

Avoid Settling

As you investigate your options, keep these four things in mind and avoid settling. Remember too:  when choosing a TMS for parcel shipping, choose the best fit. Ask yourself, “What business case am I solving for?” and “What other processes within my company will benefit from this solution?” In other words, evaluate your return on investment, not just the price.

Related Article: How a TMS for Parcel Shipping Helps You Scale

Related White Papers

Merchants Shift Closer to the Consumer
As Black Friday 2018 made loud and clear, most consumers today would prefer to have an online omnichannel shopping experience than a traditional in-store visit.
Download Now!

---

Reduce Shipping Costs with a Transportation Management Execution System
Transportation Management Execution Systems can evaluate all aspects of a shipper's business to help increase savings and performance. Download Now!

---

5 Tips for More Cost-Effective Drop Shipping
Clarity of expectations and processes between the retailer and drop shipper is the key to cost-effective drop shipping. Download Now!