Why Freight Carriers Are Switching to a Cloud-Based TMS

Many freight carriers rely on Transportation Management Systems (TMS) to ensure fleet operations run smoothly and efficiently — but there is always room for improvement in the trucking and freight industry. With the continued development of cloud-based TMS platforms, many freight companies are moving on from traditional on-premise TMS platforms. This overview highlights why freight carriers are switching to a cloud-based TMS and how it can benefit your freight company.

6 Benefits of a Cloud-Based TMS for Freight Carriers

The logistics world can be fast paced and freight carriers are always looking for innovative solutions to increase efficiency, reduce costs, and stay competitive in a competitive market. A key piece of transformative technology that has gained traction in the industry is the cloud-based Transportation Management System (TMS).

A cloud-based TMS operates by hosting its software and data on remote servers that are accessible via the internet, rather than via local infrastructure. For freight carriers, this means their entire logistics operation —from order entry to delivery — can be managed and monitored from anywhere, at any time, and by anyone with an internet connection and access to the system. This strategy changes how carriers manage their fleets, plan routes, and handle administrative tasks, leading to a more fluid and responsive operation.

Here is a closer look at six key benefits driving freight carriers to make the switch to a cloud-based TMS:

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1. Real-Time Fleet Tracking

A cloud-based TMS provides real-time visibility and tracking for your fleet's operations. This allows carriers to monitor the exact location of every truck, track delivery progress, and react quickly to unforeseen delays. Data has shown that companies that employ real-time tracking can reduce late deliveries by up to 25% and improve customer satisfaction. For example — if a truck encounters unexpected traffic, the TMS can alert dispatchers, allowing them to proactively inform the customer and reroute the driver as needed.

2. More Efficient and Optimized Route Planning

Optimized route planning is critical for minimizing fuel use and delivery times. Cloud-based TMS platforms leverage advanced algorithms and real-time traffic data to create the most efficient routes for fleet trucks and consider key factors like road conditions, driver availability, and delivery windows. This can lead to reduced costs with many carriers reporting an estimated 10-15% reduction in fuel costs and a marked improvement in delivery times due to better route optimization. 

3. More Cost Efficient

A compelling advantage of a cloud-based TMS is its cost-efficiency. By eliminating the need for expensive on-premise hardware, software licenses, and dedicated IT staff for maintenance, freight carriers can reduce their operational expenses for their TMS. Many cloud subscriptions operate on a pay-as-you-go model, turning large investments into predictable operating expenses. With the implementation of a cloud-based Transportation Management System, freight carriers can expect to see increased ROI.  

4. Easily Scalable for Freight Companies

As freight carriers grow, their logistics needs evolve and grow with them. A cloud-based TMS is inherently more scalable than on-premise platforms and allows carriers to easily add or remove users, adjust features, incorporate new software integrations, and expand their operations without major overhauls. This level of flexibility means that whether a carrier is adding five new trucks or expanding into a new region, their TMS can easily be adapted to the increased workload and allow the company to grow.

5. Automated Workflows and Invoicing

Manual processes are prone to errors and take up valuable time. Cloud-based TMS platforms automate many day-to-day tasks, including order processing, load matching, dispatching, and invoicing. This automation improves accuracy but also frees up staff to focus on more strategic activities. Many companies that employ automated invoicing report processing times reduced by up to 70% and saw a decrease in billing errors that lead to improved cash flow.

6. Improves Security and Compliance

Data security and regulatory compliance are a key asset in the logistics industry. High-quality cloud-based TMS providers invest in security measures, including data encryption, regular backups, and disaster recovery protocols, that exceed what many individual carriers can afford to implement on their own. Cloud-based platforms also promote compliance with relevant industry regulations and data privacy laws, minimizing risks and protecting personal information. This helps ensure that a carrier's client data is secure and compliant with industry standards.
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READ MORE: How To Choose the Best Fleet Management Software

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The benefits of implementing a cloud-based TMS are clear, making it a strategic imperative for modern freight carriers and highlighting why many freight carriers are switching to a cloud-based platform. From enhancing real-time visibility and optimizing routes to improving cost-efficiency and enhancing security, these systems have revolutionized how logistics operations are managed.

Contact TransPlus today for a demo and find out how TransPlus can help you navigate the future of logistics!

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