Even in 2019, many small and medium enterprises continue to conduct their business partnerships manually using Excel spreadsheets, paper invoices and bills of lading, and postal mail. Leaders of smaller businesses often feel as if the technology solutions they need to streamline these processes are financially out of reach—but that couldn’t be further from the truth.
With the rise of cloud technologies, B2B software solutions have become far more affordable. Small or medium businesses can now subscribe to solutions and receive the same functionality as offered by Tier 1 suppliers at a fraction of the cost and without any investment in hardware or other IT infrastructure. In addition, cloud-based providers often provide their clients with superior, individualized customer service and customization that can’t be matched by large out-of-the-box solutions providers.
Two of these software solutions can deliver a substantial return on investment for shippers and other supply chain-related businesses: Transportation Management Systems (TMS) and Electronic Data Interchange (EDI). Below we’ll point out some of the primary ways these two solutions can save money for your business.
How Does a TMS Save Money?
There are many reasons that shippers, logistics providers, and other freight-related businesses should use a TMS, and cost savings ranks at the top of that list. Here are a few ways investing in a TMS will actually save money:
- Labor and time. Manually processing bills of lading, scheduling drops and pick-ups, planning routes, and other manual transportation functions take personnel. By largely automating these functions, transportation stakeholders can drastically reduce labor costs and other administrative expenses. Manual processing not only requires additional labor—it simply takes longer. Processes such as optimizing loads, choosing carriers, filling out bills of lading and other documentation, gathering data for customers, and executing shipments take a fraction of the time with a TMS.
- Performance tracking. The modern supply chain requires maximum efficiency and maximum visibility at all times. A TMS automatically tracks data from your facilities, customers, and carriers, allowing you to easily identify trends and areas for improvement in your processes for you and your customers.
- Paper-free. Most modern TMS solutions digitize the majority of documentation, giving companies with an interest in reducing their carbon footprint the opportunity to use less paper. With smart carbon copying and document tracking, the need for paper can be significantly reduced or eliminated entirely.
- Route optimization. By using a TMS to automatically optimize routes, you can help drivers avoid Hours-of-Service violations, overtime, and also improve fuel consumption on every route.
How Does EDI Save Money?
Much like TMS solutions, cloud-based EDI integrates the two disparate computer systems used by business partners. This results in cost savings through the optimization of internal processes, streamlining B2B communication, and the elimination of redundant work. Cost saving benefits of EDI include:
- Labor and time. EDI reduces labor time spent marking up and manually re-entering paper invoices, purchase orders, and other documentation between business partners. Instead, this information is automatically communicated between computer systems without the need for manual input. It also eliminates the need for mailing paper documents between partners, which speeds up billing, payment, and communication.
- Onboarding. Simply put, partners can begin working together faster—which means they can begin making money together faster. By connecting your separate systems through EDI, all relevant data becomes immediately accessible by both parties so collaboration can begin.
- Paper-free. Invoices and purchase orders get communicated digitally without the need for excess printing, making EDI an optimal choice for green-conscious businesses and businesses that want to reduce their use of paper.
- Reduced software investment. EDI makes legacy systems useful longer while enabling full integration with more advanced solutions used by you or your partners. As such, if your legacy system is still working for you, you won’t need to replace it just because it isn’t compatible with partner software or solutions used by other departments.
- Business intelligence. The data gathered by EDI can be used not only to identify the information you need for daily operations, but to improve your processes and your partnership by identifying problem areas. With easy access to this data, you can build your partnership in the spirit of continuous improvement and cost savings for both parties.
Cloud-Based EDI and TMS from 360data
360data offers powerful communication and collaboration solutions for shippers, third-party logistics companies, and other transportation stakeholders. For more information about the 360data TMS or B2B integrator, please contact us online or call us at 920-707-3601.