THE LEAN SUPPLY CHAIN — HOW A TRANSPORTATION MANAGEMENT SYSTEM MAKES YOU A LEAN, MEAN, TRUCKING MACHINE
Lean supply chain management is all the rage these days. We’ve been blogging a lot about efficiency lately, and for good reason — a powerful transportation management system (TMS) is critical to making sure that, as a broker, you’re efficient.
That’s what the idea behind creating a lean supply chain is all about. Lean equals efficient. It means reducing waste, and for freight brokers, waste often comes in the form of man hours.
FORTUNATELY OR UNFORTUNATELY, FREIGHT BROKERAGE IS AN INDUSTRY THAT RUNS ON RAZOR THIN MARGINS
That’s not necessarily a good or a bad thing — it’s just the truth. The margins are thin, and if you’re relying on load boards more than you’d like, if you haven’t quite established yourself yet, they can be even thinner.
But you’re not out there alone — you’re part of a network. Other people are relying on you to be fast and efficient too.
You don’t want to be the one that turns the lean supply chain into the chubby one. You don’t want to be the weak link in the chain.
THAT’S WHERE A ROBUST TRANSPORTATION MANAGEMENT SYSTEM COMES IN
An unfortunate truth of our industry is that freight brokers are not treated with the respect they deserve.
You don’t need another reason for people to decide that a freight broker isn’t worth their time.
You provide value — a ton of it. You get loads where they need to go (and you get truckers a load to carry) when no one else can.
You make sure trucks aren’t sitting idle, customers aren’t sitting around wait for a product, and that, at the end of the day, everyone walks away happy.
At least, you do if you’re efficient (and everyone else is efficient too).
You can’t control what they do or what’s happening in the shipping lanes on any given day, you can’t control customers and what they’re doing with the product on either end, but you can control how efficient you are about what you do.
That’s exactly what a TMS is built for. A powerful, paid TMS is going to do a lot more for you than simply replace your spreadsheets.
A robust TMS is going to integrate with both your customers and with load boards, allowing you to do a lot more within a single piece of software (which saves you time).
It’s going to automate repetitive tasks and automatically find ideal rates, giving you the chance to increase your margins.
It’s like bringing on a new employee (or two or three) while only paying a fraction of an actual salary. You’re able to increase your margins and move much more quickly while reducing the actual work you have to put in.
JUST MAKE SURE YOU’RE NOT GETTING A FREE TMS
If you really want to make yourself a decisive link in a lean supply chain, you need to be efficient. Free software isn’t efficient. Do you want a free piece of virus protection software protecting your data?
I didn’t think so.
The free transportation management systems out there just aren’t going to give you what you need. They’re almost like trial versions, except they never get any better.
If you’re serious about becoming a part of the lean supply chain, you need powerful software backing you — and you’re not going to get it for free.