We often refer to products and services, especially new technologies, as eventually crossing over from being a “nice to have” to a “need to have” solution.
A plethora of research signifies that transportation management systems (TMS) have already made this leap. That said, your business still stands to gain a significant competitive advantage by moving to a TMS now, before the majority of your competitors have caught on.
A robust TMS solution is practically a no-brainer: it saves you money, improves your bottom line, eliminates pain points, and leads to more satisfied customers. Let’s take a look at exactly what you’re missing out on if you haven’t yet implemented a TMS.
You’re Overpaying for Freight
Compared to your competition, there’s a good chance you’re already overpaying on freight costs. Carriers are notorious for continually raising their prices year over year, and simply being a confident, skilled negotiator won’t be enough to keep your prices down. At MCG, we use business intelligence and a database of millions of shipping transactions to help our clients determine what they should be paying.
On top of that, if you don’t have a TMS on your side, you’re missing out on huge potential savings. Rather than being stuck with a single carrier, a TMS puts you in control, helping you to always find the lowest-cost carrier for every single shipment—and it can save you in other areas too, like reducing overcharges and better, smarter routing. Best of all, there are no spreadsheets or faxes and very little manpower required.
The savings alone can make all the difference: according to an ARC Advisory Group survey cited by Logistics Viewpoints, the average TMS user was able to reduce their freight spend by 7.5%.
On-Time Deliveries, Happier Customers
Reliable, on-time deliveries are the bread and butter of a successful shipping and logistics operation—and a robust TMS can make it much, much easier to track relevant metrics and improve your customer relationships. In the same survey mentioned above, most TMS users were able to achieve significant improvements in both on-time delivery % and service levels. They also outperformed peers in on-time order fulfillment. If you’re not using a TMS yet, your competitive disadvantage is clear.
Revenue Growth & the Bottom Line
Of course, both freight costs and service level improvements have a noticeable impact on your bottom line—but fortunately, we also have metrics that show how using a TMS directly impacts costs, revenues, and margins.
For example, companies using a TMS experience about 8.7% revenue growth year over year and a growth in margins of about 7.3%, both significantly better than average non-TMS competitors. If you haven’t yet embraced a TMS solution, you’re simply spending too much—not to mention missing out on better growth and profit margins.
Ultimately, it’s not simply that a fully-featured TMS can eliminate major pain points and save money for your business. The other facet to consider is that your competition is quickly moving to embrace this technology—and you could be left in the dust if you don’t do the same.
Everyone is feeling the pain, but it’s not too late to turn your supply chain into a competitive advantage. Contact MCG today to learn more about our TMS solutions.