Shipping is often the most expensive aspect of running an ecommerce business. This is because coordinating the movement of goods across the country and around the globe is a complex part of transportation operations and logistics management.
Most high-growth ecommerce brands choose to rely on tech solutions to help them optimize their shipping. By leveraging a transportation management system (tms) shippers can reliably track shipments, measure on-time delivery, rate shop carriers for cost savings, thereby lowering transportation costs and maximizing customer satisfaction.
What is a TMS?
A Transportation Management System (TMS) is a software platform designed to streamline and optimize the shipping process for ecommerce retailers. It can help a business manage their supply chain in many ways including order processing, product delivery time, and overall cost-management.
Most TMS platforms integrate with various shipping carriers to provide real-time shipping rates, tracking, and delivery options. This is a key feature that allows shippers to select the best carrier based on factors like cost, speed, and service level.
For ecommerce shippers, a reliable TMS can automate key functions such as label generation, shipment tracking, and route optimization. It may also provide visibility into shipping data, enabling better decision-making by analyzing metrics such as shipping costs, carrier performance, and delivery times. With these insights, businesses can improve their overall business and customer satisfaction by reducing costs and ensuring timely deliveries.
Can a TMS Manage Cross-Border Shipping?
Ecommerce is always a global venture, now that online shopping can be done from anywhere. Consumers are making purchases from overseas companies more and more each year. Yet shipping products across country borders is still quite intricate and cumbersome. There are many nuances to understand the exact fees and requirements to get a product shipped to another country.
A TMS can be a great asset when shipping internationally. It can help manage the complexities of cross-border shipping such as customs documentation and compliance with various regulations.
It can enhance customer experience by providing tracking updates and delivery notifications, which are historically long and delayed with international shipments. Overall, a TMS for ecommerce shippers is essential for optimizing logistics, reducing errors, and improving operational efficiency in a highly competitive online marketplace.
How a TMS Works to Support Your Ecommerce Supply Chain
Ecommerce brands must be able to easily manage a global supply chain. Employing key technology solutions like a robust TMS software is imperative to staying ahead in today’s competitive market. Here are some of the many ways a TMS can help support your supply chain management.
- Shipping Options: At a basic level a TMS should help you optimize your shipping solutions. This includes both inbound and outbound shipping. Core competencies of a TMS are rate shopping for the most cost-effective shipping carrier and optimal service—which means connect across transportation modes, including ground, sea, and air freight, and across shipping carriers you may choose to work with.
- Integrations: A robust transportation management system will connect with various aspects of your business. It should integrate with many supply chain partners including your ERP (enterprise resource planning) tools; warehouse management system (WMS); and your selling platforms like Shopify, TikTok Shop, Amazon.
- Data and Tracking: Order management for ecommerce brands isn’t complete without comprehensive tracking of goods across the globe. This means your TMS will need to give you real-time visibility into product shipments across your entire supply chain, from manufacturing to end-customer.
One of the big benefits of leveraging a TMS solution is that is uses machine learning to provide the most cost-effective and fastest service. This means the more data it can collect, the more optimal the solutions it will provide in real-time.
Key Benefits of a TMS Solution
Shippers wanting to optimize their transportation management can look forward to the following solutions if they rely on a reliable TMS.
- Cost savings: Optimize carrier selection and route planning to lower shipping costs.
- Improved efficiency: Automates tasks like label generation and order tracking, reducing manual errors.
- Enhanced visibility: Provides real-time tracking and analytics for better decision-making.
- Faster delivery: Optimizes delivery routes to speed up shipments.
- Scalability: Easily handles growing order volumes and international shipping needs.
- Better customer experience: Offers accurate delivery estimates and tracking updates, boosting customer satisfaction.
How to Choose a Transportation Management System
There are many TMS providers on the market, making it challenging to choose which TMS software is best for your brand.
Whether you manage fulfillment and logistics in-house or outsource to a third-party logistics provider (3PL) the TMS that supports your brand matters. If you work with a 3PL, ask what transportation planning and TMS solutions they offer.
Here are some key factors when choosing a TMS:
- Cloud-based. Data and information within a transportation management system should be cloud-based. This is they only way to do business in this fast-paced economy. Anything less will leave you with outdated information when you need it most.
- API Connections. As mentioned previously, your TMS will need to integrate seamlessly with many aspects of your business, this includes ecommerce selling platforms, WMS, ERP system, retail distributors and more. Understand fully which APIs your TMS can and cannot connect to before signing up. For a brand looking to grow into retail, this may be a deal breaker.
- Logistics service providers. If you are vetting a TMS on your own, make sure it can connect to your logistics and fulfillment providers, as these are core to your business and customer satisfaction.
Source from DCL Logistics
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