DC Velocity - September 2010

TMSi Logistics Selected as Inc. 5000 Fastest Growing Companies in America by Inc. Magazine.

Vision.

TMSi Logistics has the vision to see areas of improvement in your supply chain and the expertise to know how to fix them. By implementing a values-driven culture that improves your logistics operations, TMSi Logistics can help you deliver on your bottom line — year after year… after year…

TMSi Logistics is your high-performance source for:

• Distribution & Contract Warehousing
• Transportation & Dedicated Contract Carriage
• Technology Software Solutions & Engineering
Services
• A Values-Driven Culture that Motivates People to
Deliver Bottom Line Results

Call 603-792-2205 to get
20/20 vision of your supply chain.
www.tmsilog.com

technologyreview TMS

cially for small to mid-sized businesses.

Then there is familiarity. Many shippers use manual processes because they’re easy to understand and that’s what they were trained to use. But with millions of routings in the marketplace and with carrier options becoming increasingly complex, the “easy” way is often not the best way, Comrie says. “The excessive freight charges [in manual processes] can be very costly,” he says.

Chris Timmer, senior vice president of new business development and marketing for LeanLogistics, agrees. The traditional approach to carrier selection is akin to “dialing for dollars,” he says. Timmer adds that LeanLogistics prefers to offer its clients a total TMS solution that incorporates a carrier selection function, instead of marketing it as a stand-alone model. LeanLogistics builds a “ pre-deter-mined routing guide,” where the routing is automatically planned, assigned, and executed without any human interaction, he explains.

Timmer says proper carrier selection has taken on new importance as freight capacity starts to tighten and shippers change their procurement behavior. The LeanLogistics survey found that 70 percent of shipper respondents were now buying transportation multiple times throughout the year instead of the traditional practice of purchasing most, if not all, of their capacity in the year’s first quarter when space is more abundant. In addition, roughly the same percentage of shippers said they were coming to market with proposals on a regional or lane-by-lane basis instead of the traditional “network-wide” approach, according to the survey.

“We are seeing a bigger challenge with capacity,” Timmer
says. “Many of our shippers are getting concerned about
capacity constraints and their impact on rates.”
Comrie of Transite says the increasing complexity of carri-
er routings makes TMS-based carrier selection an even more
vital part of a shipper’s arsenal. As shipment size continues to
shrink and companies spread inventory replenishment over
an entire year instead of concentrating it in one quarter, they
find themselves shifting modes from mostly truckload to a
mix of truckload and less-than-truckload, with a healthy
dose of small package thrown in, he says.

For companies used to having a broker give them a flat rate on a truckload shipment, these new choices present something of a challenge, Comrie says. “Deciding on the fly with smaller shipments that are more time sensitive is new [to them] and would most likely cost them dearly in excessive freight charges due to lack of proper rating and routing capabilities,” he says.

And with shipping often the third or fourth biggest line item on a manufacturer’s profit-and-loss statement, the carrier selection function within a TMS that achieves freight savings in the high single digits to low double digits is like shooting fish in a barrel, according to Comrie.