Full Truckload (TL) & Less Than Truckload (LTL) Shipping

LTL and FTL Shipping: What’s the Difference?

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The terms less-than-truckload (LTL) and full-truckload (FTL) get thrown around often within the shipping and logistics community. However, newcomers may find themselves at a loss for what these terms actually mean. To clear this up, we are breaking down each term individually before directly comparing them so that you can choose the best shipping modes for your freight. Understanding the difference will help you make better freight choices.

Freight Shipping

First and foremost, it’s important to know what freight shipping actually is. The term freight shipping refers to the paid process of shipping goods by ground, sea, or air. Freight is typically composed of goods that are being transported to another location in bulk. Two subcategories that fall under the umbrella of freight shipping are less than truckload (LTL) shipments and full truckload (FTL) shipments.

Less Than Truckload (LTL) Shipping

Less than truckload freight shipments, commonly abbreviated as LTL, are shipments that exceed the size limit required to be able to ship as a single package through the mail (a parcel shipment). Despite being too large for a parcel carrier, less than truckload shipments are too small to fill an entire semi-truck trailer, leaving lots of wasted space and contributing to “empty miles.” In order for shipping to be mutually beneficial between the shippers and trucking companies, carriers often ship multiple LTL shipments together to make the trip economically sensible. This way trailers aren’t traversing our highways carrying only air.

Benefits

• Lessen environmental impact

This method of ‘carpooling’ with LTL shipments from other companies reduces the impact transportation has on the environment. Less fuel is used when fewer trucks are needed to transport the same number of total shipments.

• Decrease warehouse expenses

By adopting LTL shipping, companies relieve themselves of the stress that comes with having too much product built up in their warehouse or staged at their docks. Through shipping consistently, companies are able to keep less in their warehouse and also keep a more accurate inventory as a result.

• Minimizes costs on smaller shipments

Traditionally, the lowest rates are reserved for shippers that can fill the entire semi-truck trailer and qualify for full truckload rates. LTL shipping gives companies that aren’t able to fill an entire truck the opportunity to minimize costs by consolidating their freight with other company’s freight. With LTL shipping, companies only pay for the weight of their freight and the space it uses on the trailer.

Full Truckload (FTL or TL) Shipping

Conversely, full truckload shipments (abbreviated FTL or TL) are large enough to fill up an entire semi-truck trailer. Unlike LTL shipments which might ride alongside other shipments, FTL freight is contracted to one carrier and rides alone, meaning there don’t need to be extra stops along the way. This reduces the number of “touches” and reduces the likelihood of damages. When there is enough freight to qualify for a full truckload rate, this is usually the most economical choice.

Benefits

• Save money on larger shipments

If you have enough freight to fill an entire trailer, a FTL shipment will be the most efficient mode. It’s less expensive to ship a single FTL shipment when compared to splitting up the freight into multiple LTL shipments.

• Lower risk of damage

Shipping a full truckload means that from start to finish, your freight will remain in the same semi-truck trailer. This simplifies the transportation process and eliminates the potential risks associated with LTL shipments being handed off to other trucks along their route. Decreasing the number of “touches” freight undergoes during transport reduces risk.

• Ship products faster

When shipping FTL, the only factors considered in the truck’s route are the origin of the freight and its final destination. With LTL, there may be multiple origins and final destinations involved that can lengthen the travel time and impact delivery times as a result. FTL shipments ensure that freight is arriving as quickly as possible by traveling from point A to point B.

Which Should I Choose, LTL or FTL?

LTL and FTL shipping are both beneficial types of freight shipping. For smaller shipments that are too big to be shipped parcel, LTL shipping is often the best choice. For larger shipments that are able to completely fill or almost fill an entire truck, FTL is less expensive. Both are acceptable options when thinking about how to ship your freight, but each has specific scenarios in which they are most beneficial to the shipper.

It is always a good idea to compare the freight rates of multiple LTL or FTL carriers to choose the carrier with the best rate and service level for your shipment.

Why Should You Compare Your Freight Rates?

Comparing rates is the best method to avoid overpaying. Whether shipping LTL or FTL, different carriers will offer different freight rates and service levels and it’s important to shop around. Looking into what’s available often makes way for the discovery of less expensive rates or particular lanes that have the ability to speed up delivery. Prices constantly fluctuate and what initially seems like the better option may not be best in the end.

How Can a Transportation Management System Help?

Leveraging technology is the easiest way to ensure that you are shipping your freight most efficiently. By utilizing a transportation management system like Kuebix TMS, shippers can compare all of their negotiated and spot rates within a single platform. With the ability to compare rates instantly, shippers have the power to book confidently and quickly.

Kuebix TMS users can also leverage Community Load Match which provides complementary truckload rate assessments to ensure they’re making strategic truckload shipping decisions. Kuebix Community Load Match provides shippers with an alternative source of truckload capacity and allows carriers to fill their trucks!

Apart from acting as a vehicle for finding and booking better FTL rates, transportation management systems also simplify everyday shipping operations. Users can integrate ERP systems such as NetSuite and Microsoft Dynamics to increase operational efficiencies and remove the risk of human error. With an ERP integration, orders flow seamlessly between Kuebix and the external platform to reduce manual error and speed up operations.

Many companies also use optimization technology in their TMS to combine LTL shipments into FTL shipments for greater efficiencies and cost savings. Kuebix TMS offers a variety of advanced functionalities including Order and Route Optimizer, which optimizes shipments for maximum rate and route efficiency.

Check out this case study with Hanover Foods to learn how their utilization of Kuebix saved over $1 million in freight spend!

The Top 3 Commodities Shipped By Truck in all 50 States

The Top 3 Commodities Shipped By Truck in all 50 States

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Have you ever been driving on the highway and wondered what kind of freight was on the truck beside you? Unless it’s a clearly defined Coca-Cola or retail branded truck, you probably have no clue. That’s why we’ve put together this list of the top ground freight commodity types shipped by truck in each of the 50 states! Check out the top three commodity types in your state to guess what you might be passing on the highway.

Curious about other types of freight? Check out this dashboard from explore.dot.gov

Top Three Ground Freight Commodities Transported via Truck Between Oct 2018 – September 2019 (by value & weight)

Alabama

By Value

  1. Mineral Fuels
  2. Vehicles Other than Railway
  3. Electrical Machinery

By Weight

  1. Mineral Fuels
  2. Iron and Steel
  3. Salt; Sulfur; Plaster and Cement

Alaska

By Value

  1. Iron and Steel
  2. Vehicles
  3. Electrical Machinery

By Weight

  1. Salt; Sulfur; Plaster and Cement
  2. Iron and Steel
  3. Vehicles

Arizona

By Value

  1. Electrical Machinery
  2. Vegetables and Roots
  3. Computer Parts

By Weight

  1. Vegetables and Roots
  2. Fruit and Nuts
  3. Inorganic Chemicals

Arkansas

By Value

  1. Electrical Machinery
  2. Vehicles
  3. Computer Parts

By Weight

  1. Iron and Steel
  2. Electrical Machinery
  3. Computer Parts

California

By Value

  1. Vehicles
  2. Electrical Machinery
  3. Computer Parts

By Weight

  1. Mineral Fuels
  2. Vegetables and Roots
  3. Fruit and Nuts

Colorado

By Value

  1. Computer Parts
  2. Electrical Machinery
  3. Vehicles

By Weight

  1. Computer Parts
  2. Electrical Machinery
  3. Vegetables and Roots

Connecticut

By Value

  1. Pearls; Stones; Metals and Imitation Jewelry
  2. Zinc
  3. Electrical Machinery

By Weight

  1. Zinc and Articles
  2. Copper and Articles
  3. Sugars and Confectionery

Delaware

By Value

  1. Works of Art and Antiques
  2. Measuring and Testing Instruments
  3. Electrical Machinery

By Weight

  1. Salt; Sulfur; Plaster and Cement
  2. Mineral Fuels
  3. Electrical Machinery

Florida

By Value

  1. Vehicles
  2. Electrical Machinery
  3. Computer Parts

By Weight

  1. Salt; Sulfur; Plaster and Cement
  2. Fruit and Nuts
  3. Vehicles

Georgia

By Value

  1. Electrical Machinery
  2. Vehicles
  3. Computer Parts

By Weight

  1. Beverages
  2. Sugar and Confectionery
  3. Computer Parts

Hawaii

By Value

  1. Computer Parts
  2. Measuring and Testing Instruments
  3. Electrical Machinery

By Weight

  1. Beverages
  2. Computer Parts
  3. Electrical Machinery

Idaho

By Value

  1. Vegetables and Roots
  2. Vehicles
  3. Electrical Machinery

By Weight

  1. Fruit and Nuts
  2. Preparations of Vegetables; Fruits and Nuts
  3. Vegetables and Roots

Illinois

By Value

  1. Beverages
  2. Electrical Machinery
  3. Computer Parts

By Weight

  1. Beverages
  2. Mineral Fuels
  3. Electrical Machinery

Indiana

By Value

  1. Computer Parts
  2. Electrical Machinery
  3. Vehicles

By Weight

  1. Computer Parts
  2. Electrical Machinery
  3. Vehicles

Iowa

By Value

  1. Vehicles
  2. Computer Parts
  3. Electrical Machinery

By Weight

  1. Vehicles
  2. Computer Parts
  3. Furniture

Kansas

  1. Aircraft
  2. Electrical Machinery
  3. Special Classification Provisions

By Weight

  1. Iron and Steel
  2. Computer Parts
  3. Rubber and Articles

Kentucky

By Value

  1. Computer Parts
  2. Vehicles
  3. Electrical Machinery

By Weight

  1. Computer Parts
  2. Salt; Sulfur; Plaster and Cement
  3. Vehicles

Louisiana

By Value

  1. Mineral Fuels
  2. Vehicles
  3. Iron and Steel

By Weight

  1. Mineral Fuels
  2. Salt; Sulfur; Plaster and Cement
  3. Iron and Steel

Maine

By Value

  1. Aluminum and Articles
  2. Vehicles
  3. Not Knitted or Crocheted Apparel

By Weight

  1. Aluminum and Articles
  2. Vehicles
  3. Vegetables and Roots

Maryland

By Value

  1. Vehicles
  2. Electrical Machinery
  3. Computer Parts

By Weight

  1. Sugars and Sugar Confectionery
  2. Salt; Sulfur; Plaster and Cement
  3. Vehicles

Massachusetts

By Value

  1. Electrical Machinery
  2. Measuring and Testing Instruments
  3. Computer Parts

By Weight

  1. Paper and Paperboard
  2. Measuring and Testing Instruments
  3. Electrical Machinery

Michigan

By Value

  1. Vehicles
  2. Computer Parts
  3. Electrical Machinery

By Weight

  1. Vehicles
  2. Computer Parts
  3. Salt; Sulfur; Plaster and Cement

Minnesota

By Value

  1. Computer Parts
  2. Measuring and Testing Instruments
  3. Electrical Machinery

By Weight

  1. Fruit and Nuts
  2. Computer Parts
  3. Iron and Steel

Mississippi

By Value

  1. Electrical Machinery
  2. Vehicles
  3. Computer Parts

By Weight

  1. Iron and Steel
  2. Organic Chemicals
  3. Electrical Machinery

Missouri

By Value

  1. Electrical Machinery
  2. Vehicles
  3. Computer Parts

By Weight

  1. Electrical Machinery
  2. Computer Parts
  3. Glass

Montana

By Value

  1. Vehicles
  2. Tobacco
  3. Computer Parts

By Weight

  1. Vehicles
  2. Tobacco
  3. Computer Parts

Nebraska

By Value

  1. Vehicles
  2. Computer Parts
  3. Electrical Machinery

By Weight

  1. Iron and Steel
  2. Vehicles
  3. Inorganic Chemicals

Nevada

By Value

  1. Electrical Machinery
  2. Beverages
  3. Toys; Games and Sport Equipment

By Weight

  1. Beverages
  2. Miscellaneous Articles of Base Metals
  3. Electrical Machinery

New Hampshire

By Value

  1. Computer Parts
  2. Electrical Machinery
  3. Measuring and Testing Instruments

By Weight

  1. Computer Parts
  2. Electrical Machinery
  3. Measuring and Testing Instruments

New Jersey

By Value

  1. Electrical Machinery
  2. Measuring and Testing Instruments
  3. Cereals and Flour

By Weight

  1. Cereals and Flour
  2. Fruit and Nuts
  3. Electrical Machinery

New Mexico

By Value

  1. Measuring and Testing Instruments
  2. Computer Parts
  3. Electrical Machinery

By Weight

  1. Vegetables and Roots
  2. Live Animals
  3. Plastics and Articles

New York

By Value

  1. Computer Parts
  2. Electrical Machinery
  3. Beverages

By Weight

  1. Electrical Machinery
  2. Computer Parts
  3. Salt; Sulfur; Plaster and Cement

North Carolina

By Value

  1. Computer Parts
  2. Electrical machinery
  3. Plastics and Articles

By Weight

  1. Plastics and Articles
  2. Organic Chemicals
  3. Vehicles

North Dakota

By Value

  1. Vehicles
  2. Electrical Machinery
  3. Computer Parts

By Weight

  1. Vehicles
  2. Iron and Steel
  3. Computer Parts

Ohio

By Value

  1. Computer Parts
  2. Vehicles
  3. Electrical Machinery

By Weight

  1. Computer Parts
  2. Vehicles
  3. Electrical Machinery

Oklahoma

By Value

  1. Vehicles
  2. Computer Parts
  3. Electrical Machinery

By Weight

  1. Vehicles
  2. Article of Iron and Steel
  3. Iron and Steel

Oregon

By Value

  1. Vehicles
  2. Electrical Machinery
  3. Computer Parts

By Weight

  1. Salt; Sulfur; Plaster and Cement
  2. Iron and Steel
  3. Vehicles

Pennsylvania

By Value

  1. Vehicles
  2. Electrical Machinery
  3. Computer Parts

By Weight

  1. Vehicles
  2. Electrical Machinery
  3. Computer Parts

Rhode Island

By Value

  1. Vehicles
  2. Measuring and Testing Instruments
  3. Computer Parts

By Weight

  1. Vehicles
  2. Computer Parts
  3. Articles of Iron and Steel

South Carolina

By Value

  1. Vehicles
  2. Electrical Machinery
  3. Computer Parts

By Weight

  1. Vehicles
  2. Electrical Machinery
  3. Computer Parts

South Dakota

By Value

  1. Vehicles
  2. Computer Parts
  3. Paper and Paperboard

By Weight

  1. Salt; Sulfur; Plaster and Cement
  2. Paper and Paperboard
  3. Computer Parts

Tennessee

By Value

  1. Vehicles
  2. Computer Parts
  3. Electrical Machinery

By Weight

  1. Vehicles
  2. Computer Parts
  3. Electrical Machinery

Texas

By Value

  1. Computer Parts
  2. Electrical Machinery
  3. Vehicles

By Weight

  1. Mineral Fuels
  2. Salt; Sulfur; Plaster and Cement
  3. Vehicles

Utah

By Value

  1. Pearls; Stones; Metals and Imitation Jewelry
  2. Vehicles
  3. Electrical Machinery

By Weight

  1. Vehicles
  2. Cocoa and Cocoa Preparations
  3. Plastics and Articles

Vermont

By Value

  1. Electrical Machinery
  2. Computer Parts
  3. Meat and Edible Offal

By Weight

  1. Electrical Machinery
  2. Meat and Edible Offal
  3. Vehicles

Virginia

By Value

  1. Vehicles
  2. Computer Parts
  3. Electrical Machinery

By Weight

  1. Vehicles
  2. Vegetables and Roots
  3. Computer Parts

Washington

By Value

  1. Vehicles
  2. Computer Parts
  3. Electrical Machinery

By Weight

  1. Salt; Sulfur; Plaster and Cement
  2. Vehicles
  3. Wood and Articles

West Virginia

By Value

  1. Computer Parts
  2. Vehicles
  3. Special Classification Provisions

By Weight

  1. Articles of Iron and Steel
  2. Computer Parts
  3. Vehicles

Wisconsin

By Value

  1. Electrical Machinery
  2. Measuring and Testing Instruments
  3. Computer Parts

By Weight

  1. Electrical Machinery
  2. Computer Parts
  3. Vegetables and Roots

Wyoming

By Value

  1. Computer Parts
  2. Vehicles
  3. Iron and Steel

By Weight

  1. Computer Parts
  2. Articles of Iron and Steel
  3. Iron and Steel

 

CDL License Training Students

New Programs Encourage Students to Pursue CDL License

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The truck driver shortage remains top of mind for many throughout America. To combat this perceived shortage, schools are hoping to equip their students for bright futures in a booming industry. They hope to encourage students to follow a career path within logistics by providing classes that walk them through the process of getting their commercial driver’s license (CDL). With the help of these programs, the trucking industry will be able to welcome a new generation of younger drivers looking for long-term work.

Elgin Community College Truck Driving Program

Located in Illinois, Elgin Community College has set out to educate their students on the well paying, steady jobs available to truck drivers and how to join the field. The program requires 320 hours of classroom and road times to teach students all of the information and skills they need to get their CDL.

The school is laying the groundwork for an appropriate foundation of knowledge and experience that will set students up for a more successful future. Those who participate in the program also get a direct line of connection to professionals willing to help them drive and talk to them about their experience in the industry.

Truck Driving Program in Central Minnesota

Concerns about filling what is projected to be just over 4,000 job openings in the trucking industry led to just over a half-dozen local businesses teaming up with Ridgewater College, the Willmar School District and Atwater-Cosmos-Grove City School District to create and provide a class to help students obtain a CDL and fill one of the many available jobs upon graduation.

This new program is only available to 18-year-old students. At the end of the program, students will have taken “a classroom course, taken the written CDL permit test, obtained a required physical, gained experience driving a semi in a simulator lab and spent nearly 40 hours of behind-the-wheel training in an actual semi with an industry pro serving as a mentor.” All of this experience comes together to ensure that the student has received a well-rounded education on the job at hand, allowing them to help companies as well as launch their own career.

Guilford Technical Community College’s Truck Driving Program

Based in North Carolina, Guilford Technical Community College (GTCC) has announced its intent to start a truck driving school on their Cameron Campus in Colfax. Faculty are anticipating a lot of interest in the program from students. With many drivers aging out, companies in the area find themselves constantly looking for drivers.

Guilford County hopes that the program will spark interest within the field, as logistics and transportation are a significant chunk of their businesses as well as the surrounding area. The school is hoping to shed light on the fact that the transportation industry is “one of the most profitable career paths available for students.”

In beginning these programs, schools are solving several issues at hand. They are filling the growing number of open positions within the industry while also helping students launch their long-term careers in logistics immediately upon graduation.

The Future of Freight: Why We Launched a Free Transportation Management System (TMS)

The Future of Freight: Why We Launched a Free Transportation Management System (TMS)

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In October of 2017, Kuebix launched its free transportation management system (TMS), Kuebix Free Shipper. This platform offers unlimited rating, booking and tracking of TL, LTL, and parcel freight. It was the first step in the evolution of transportation management systems.

Why it’s Important

In the past, it was common practice to manage freight with spreadsheets and other manual processes or outsource to third-party logistics providers, both of which soaked up vast amounts of valuable time and money. With Kuebix Free Shipper, businesses of any size have the opportunity to streamline operations with a single cloud-based platform, removing room for potential miscommunication and monotonous tasks.

Bart De Muynck, Vice President of transportation technology research at Gartner, says that “Transportation management systems (TMS) have become the ‘must have’ for companies that – working under the pressure of e-commerce and omni-channel – need to move beyond clipboards, spreadsheets, and phone calls.”[1]

Though transportation management systems have been around for some time, the implementation and ownership costs typically associated with TMSs have been too high for small and midsize companies. Kuebix Free Shipper removes the cost barrier for those companies that only need a base TMS. Companies looking for advanced functionality can take advantage of Kuebix’s modular and premier features with an upgrade to Kuebix Business Pro or Kuebix Enterprise. The TMS adjusts seamlessly to fit the needs of any size business so that logistics operations can be performed at peak efficiency.

Free TMS Features

Regardless of budget or company size, Kuebix Free Shipper allows users to:

  • • View and negotiate LTL, TL, and Parcel rates and transit times
  • • Get spot quotes for volume freight
  • • create, book and manage shipments
  • • Access and print BOLs and shipping labels
  • • Receive real-time tracking updates on shipments, providing more accurate information to pass onto customers

Improving supply chain visibility and efficiency is made easy through the adoption of Kuebix Free Shipper. Companies who experience growth and find that they need more advanced features can upgrade at any time rather than jumping ship and searching for another TMS platform to manage their logistics operations. Kuebix TMS has the unique flexibility to fit the mold of any company at any stage of their growth.

What Customers Say About Kuebix’s Free TMS

 

Marc Orlando, Logistics Manager at hardware and software manufacturer, Bizerba, says that “Kuebix has allowed us to create a marketplace for our business with our carriers and help us better manage the day-to-day logistics operations with real-time information in ways we were not able to do previously.”

Through the implementation of the TMS, Bizerba was able to improve visibility across its supply chain and improve their operations through the insight they obtained as a result of this change. Additionally, having shippers and carriers utilizing the same platform has improved communication between everyone involved in the shipping process.

Gunner Kennels, a dog kennel manufacturing company, used a 3PL to manage their freight prior to partnering with Kuebix. Brandon Beasley, Vice President of Operations at Gunner Kennels, says that they “realized we were wasting a lot of money by using a 3PL to manage our transportation operations. We knew that if we had contracted rates directly with carriers, we could save a lot of money.”

Transparency throughout the supply chain is vital in terms of ensuring that your company is getting the best rates. Gunner Kennels realized that sacrificing visibility and trusting an outside party to handle their operations was no longer worth the cost. They wanted to have more direct involvement in their transportation operations to ensure that they were saving as much money as they could. By implementing Kuebix, Gunner Kennels was able to part ways with their restrictive 3PL and make this vision possible.

Our Goal

Kuebix has set out to eliminate the price barrier that traditionally excluded small to midsize businesses and establish a community of shippers by making transportation management systems more widely accessible throughout the supply chain. With Kuebix Free Shipper, the amount of time and effort it takes to compare rates and set up shipments is drastically reduced. Users have access to all their negotiated and spot rates to compare and choose the rate that best fits their shipping needs.

Kuebix is challenging the way shippers traditionally think about transportation management systems and ensuring that these digital advantages are not reserved only for larger companies. Establishing and maintaining this all-inclusive platform not only allows companies to save time and money, but also collaborate through visibility across their supply chains.

Benefits of Scale

By offering a free TMS that shippers can easily add modular or premier applications to with the choice to upgrade, Kuebix is creating a community like no other in the industry. Kuebix’s Shipping Community has brought together 16,000+ shippers of all sizes and with all different business needs.

Every shipper that uses Kuebix TMS expands the Kuebix Shipping Community and the community is connected to a vast network or carriers, brokers, freight forwarders and carrier marketplaces creating an ecosystem that generates efficiency for all stakeholders. This ecosystem of supply chain professionals is formed by all shippers, brokers, suppliers, and carriers actively using the cloud-based platform, therefore creating more opportunities with scale. Key among these opportunities is the chance to match available freight with available capacity. The larger the community, the bigger the potential benefits through greater collaboration. The community continues to grow as we add new, valuable features like Kuebix Community Load Match for our users.

[1] https://www.logisticsmgmt.com/article/2019_transportation_management_systems_tms_market_update_keeping_pace_with

TMS Options Proliferate, But Not for All

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This is the second in a three-part series that tracks the evolution of the TMS from the late 1990s to today. In last week’s piece I discussed the emergence of the TMS. Next week I’ll discuss the future.

When we last left transportation management systems (TMS), the high price and staff requirements of the early systems had created two groups of freight shippers, the haves, which could afford the high expense of on-prem big-box systems, and a far larger group of have-nots.

The needs of shippers struggling to replace manual processes with automation, drove widespread developments of new products, services and third parties. Most of these used different approaches for addressing the huge need for efficiency in supply chains. Meanwhile, the maturity of cloud computing was driving changes across industries and was just beginning to gain traction in logistics.

The lineup of options for shippers looking to improve their logistics operations included on-site system vendors, services from 3rd party logistics providers, and a shallow pool of companies looking to leverage the software-as-as-service model and approach to locating system intelligence.

Word from Above

But what lead to cold sweats for shippers was all the best practice and success stories that the tech trades and even the business media were running. They featured pioneering companies that had implemented a solution to cure their shipping ills and were said to be on the leading edge of technology use for business gain.

That started the deluge of direct questions from C-level executives.

Are we checking out TMSs? Is this something for us? Can we save money? Why haven’t we done this? C-level execs started believing that their companies could quickly turn their freight shipping into a profit center from a cost center.

It didn’t matter that the price for a TMS was too high or that many of the options covered one aspect of shipping but not many others.

TMS Affordability?

You’d think for sure that a growing group of TMS options would benefit all shippers desperately seeking freight intelligence. The reality was that TMSs were still not accessible to most businesses in the U.S. The have-nots could find affordable freight handling options, but that meant paying a third party to handle their freight shipping function.

For most, price as in the TCO, was the single largest impediment to implementing a system that would enable logistics professionals to truly manage their freight transportation. Isn’t it ironic that the sticker price of TMS options and alternative is what was keeping the have-nots from cutting costs and generating new revenue?

Clear Forecast

With the maturity of the cloud, it became clear that locating a TMS software product on a platform in the network  and sold as-a-(monthly)-service would break down the many barriers to implementation that so many businesses of all sizes were up against.

This opportunity sure got the attention of shippers who had all but given up on an on-site TMS and wanted something that was both flexible in architecture and easier to cost justify to their bosses.

An Easier Sell

Many enterprise freight shippers moved from controlled freight chaos to the cloud and found that advances in platform technology and automation from TMS software made for easier installation and a faster return on investment.

But while a growing mass of businesses were putting cloud-based TMSs to the test – and turning a cost center to a profit center, SMBs, which I believe make up over 90% of all U.S. businesses, still couldn’t justify a TMS spend. Some outsourced their operations to 3PLs. Others were stuck with their inefficient status quo.

Believe me, whether you’re a kid or a shipping professional nothing’s worse than watching someone else get, enjoy (and profit from), something great that you can’t have.

In the final installment of this three-part series, I’ll explain how important changes in the evolution of the TMS will define the future of freight shipping. Thanks for staying tuned!

 

 

 

 

Logistics to Avoid the Toys R Us Trauma

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For those not in the shipping business, news that Toys R Us filed for bankruptcy protection had the same effect as a surprise Gatorade bath. For the rest of with experience in the logistics business, this was just the latest stark reminder of the long-running battle between retailers and online sellers.

It’s next to impossible to drive in urban and suburban areas without noticing the telltale signs of the ongoing struggle. Empty storefronts and going-out-of-business sale banners have been popping up in some of the strip plazas and malls I drive by on a regular basis.

Still, the Toys R Us news comes just a few months before yearend holiday shopping begins in earnest. Many of the company’s woes are connected to it carrying billions in debt and spending hundreds of millions annually to service it. But another part of its predicament seems to be supply chain related.

In an extensive piece chronicling the company’s challenges in the Wall Street Journal , Toys R Us CEO Chief David Brandon was quoted as saying in court papers that the firm had fallen behind some competitors and cited “our inability to provide expedited shipping options, and our lack of a subscription-based delivery service.”

Logistics intelligence can play a vital role in helping retailers survive in these tough times, and thrive. A flexible supply chain, powered by a solid transportation management system (TMS) can definitely be part of the solution for retailers looking to better compete with e-commerce companies for customers.

I’ve seen plenty in working extensively in the retail and ecommerce industries. I’ve been asked the following question countless times over the many years since ecommerce began.

How can a TMS help retailers?

-Implement technology to help support business functions. The right TMS can help streamline the retailer’s supply chain. Logistics managers need visibility into their operations as well as the control to manage them in a way that knocks out inefficiencies, cuts costs and provides revenue opportunities.

-Less product in pipeline. Once they have control and management of their transportation systems, retailers can adjust them so that they keep less product in the supply chain, which incurs reduces freight cost. The opposite – keeping more coming, is also a benefit as predictable peak demand periods approach.

-Improve the customer experience. How many times have we heard a sales associate tell us “we don’t have any more in the back room and I don’t know when the next truck shipment is coming in?” The right TMS can allow the retailer to take control of their inbound freight by providing visibility to all deliveries, ensuring on-time deliveries and reduced freight costs.

–Quicker delivery. E-commerce companies have earned props for quickly delivering product, and rightly so. But two can play that game. By using a TMS to shorten their delivery intervals, retailers can make sure they have enough stock on hand.

–Optimize your supply chain. For this, you need a TMS with a global logistics community, which is essentially a real-time, online members-only network that connects all these parties online so they can collaborate across supply chains to find the best (sometimes fastest) and least expensive means to get cargo from origination to destination and from destination to consumers.

The Road Ahead

Investing in technology to enhance and evolve the way you do business is the way to drive your company forward from a logistics standpoint. There are TMS options that don’t require a big spend on hardware and staff, or a long, drawn out implementation. You need a quick ROI as well as a system that gives you control, visibility and cost savings ASAP.

It’s well worth your time to check out a TMS built with the freight intelligence necessary to advance in the toughest of times. Think about that the next time you’re driving past a shopping plaza and see the sad signs.