By Lisa Henthorn, V.P., Marketing and Communications
Even as they enjoy a healthy reduction in freight spend by implementing a transportation management system (TMS), some companies – especially those with an expanding global footprint – might be short-changing themselves from the full business value a TMS can deliver.
As ARC Advisory Group Senior Analyst Chris Cunnane states in his recent post on Logistics Viewpoints – Transportation Today: Why You Need a TMS to Thrive – implementing a TMS “is no longer a ‘nice to have’ solution; it is becoming a ‘need to have.’”
That’s especially true for companies looking to tap into the omni-channel opportunities arising from the continued expansion of global e-commerce, Cunnane advises:
“According to a recent ARC omni-channel survey, e-commerce revenues have grown for our survey respondent pool by 51% over the last five years, and this growth is expected to continue over the next five years. However, a technology gap exists. According to our research, only 60% of respondents are currently using a TMS for omni-channel initiatives. This shows there is a global TMS need to be filled due to more complicated transportation activities.”
In other words, a TMS is a must-have to survive in the global marketplace. But to truly thrive there, some companies may need to upgrade their existing system to a TMS with Level 5 capabilities.
Of the five levels of TMS offered in the market, only Level 5 is focused on tackling the unique and unpredictable business challenges that inevitably crop up while companies expand their global shipping and logistics operations.
Overcoming these complicated challenges can yield significant business benefits. As ARC’s Cunnane points out:
“From an omni-channel standpoint, TMS users are seeing better year-over-year growth in both revenues (8.7% vs 7.3%) and margins (7.3% vs. 6.1%). Margins are especially important when looking at the role transportation plays in overall costs. Additionally, TMS users are outperforming their peers in terms of on-time order fulfillment (92% vs. 87%).”
All of which begs the question: Do you need more from your TMS? Eyefreight would be happy to help answer that question today.