The distribution and transportation process has become the most critical process in the management and administration of supply chains since not only are its costs highly representative but it is estimated that between 30% and 60% of the total costs of logistics are directly involved with the relationship with customers. This means that companies today have within their strategic business vision the acquisition of transport management and administration software (TMS) or think about changing the solution they have today to better suit their company. To accompany this process, below you will find 10 important keys to guide you in choosing the right software provider:
- Customized solution, SMB solution, world-class solution: Customized solutions will be an initially attractive option, since it will allow you to adapt it to the current requirements of the operation, however, its development will take a long time since it must involve algorithms advanced routing, complex formulas for transport settlement, among other features. Additionally, the evolution and updating of these tools will be very expensive in the end. An SMB (Small Medium Business) solution is a small solution that will allow small and medium-sized companies to acquire software that optimizes their distribution operation, normally these solutions are not TMS but are small tools with some functionalities. If your company is large and moves more than 30 vehicles per day, it would be worth looking at a world-class solution, which are robust TMS solutions with more than 20 years of development, that will respond to the challenges of your company. Having defined what kind of solution your company is looking for and needs will allow you to select the appropriate providers and compare them under these premises.
- Scope: Understand the scope based on the business model, if it is on-premise if it is cloud if its model is SAAS, and what is included. It is advisable to choose a cloud model as it will always allow access to constant software updates without sacrificing information security.
- Scalability: It is important that as the company grows it has a scalable solution that allows it to respond to the challenges of a constantly changing market, which supports multiple operations and multiple business models. Likewise, it is necessary to understand if the software will allow it to reach other functionalities that its operation may require in the future, such as traceability, control of deliveries, surrender of trips, and settlement of freight, which in general are components of a comprehensive TMS software.
- Flexibility: Having robust and world-class software should not be restrictive or oversize the needs of the company, a modular solution will allow you to implement the components that your company requires without having to fully acquire the software and even implement them in phases according to needs and available resources.
- Configuration: How well is the tool adapted to the needs of my operation? How configurable is it? You have to understand if the tool allows you to configure all the business rules of the organization, all the restrictions, and all the necessary variables such as geography, customers, orders, delivery times, traffic conditions, weight, volume, pallets, and vehicle capacity, among many others. Generally, small tools do not allow a high configuration, are restrictive, and require many post-implementation developments to be able to adjust to the needs of the operation, which will imply subsequent costs.
- Processing time: Another important factor to consider is the data processing time since many systems collapse or take many hours to achieve results, so depending on the need it is an important point to evaluate.
- Integration: Understand if the tool allows integration with the systems that the organization has such as ERP, WMS, CRM, eCommerce, if the integration will be native or if it will only be through flat files, and how flexible it is.
- New technologies and innovation: Machine Learning, IoT, Big Data, Artificial Intelligence, and other concepts should no longer be alien to TMS solutions. The digital transformation that Logistics 4.0 requires to continue advancing makes a well-adapted routing software the best tool to meet the objectives in the Supply Chain, in addition to having a good team and well-defined processes
- Support: Verify support coverage, the language in which they provide it, their response times, and that they have a specialized area to provide services. It is not enough just to provide support when the customer seeks it, you must also interact proactively.
- Manufacturer and implementer experience: The manufacturer’s trajectory is quite important when choosing a routing software, this will give us an understanding of how robust the tool is, how developed its routing algorithms are. Likewise, the number of implementations, the industries in which it has been implemented, and the size of its clients.
Taking these aspects into account, you can ensure that the solution you have selected will cover the functional, technical, and strategic requirements of your company.
Cerca Technology, a company with more than 27 years implementing world-class solutions in leading companies in the supply chain, has a consulting team that will accompany you in understanding the scope of the implementation of a solution for distribution and transportation, taking into account the challenges and needs of your company.