Freight Management Software, Processes, and How It Works

freight management software processes and how it works itechnolabs

Like many other sectors, transportation is also having a tough year. Because of the panic shopping in the early days of the epidemic, the volume of trucking was up 30. Then, they dropped in the following months, and have only recently increased. The ocean, rail delivery, and last mile are all down at least 20 percent. Costs for labor are rising and decreasing freight rates, demand for speedier shipping and fewer orders, and overall higher margins for carriers. These are unsettling conditions that have already affected the way that operations are conducted.

In this article, we’ll discuss modern methods of freight management software and how shippers and retailers can leverage technology to lower costs, enhance customer experiences, and improve connectivity within the trade networks.

What is the term “freight management”?

  • Load, route, and transportation optimization
  • Optimization of schedule and route
  • Planning for load
  • Optimization of intermodal and multimodal modes

what is the term freight management itechnolabs

The process of managing freight is the practice of monitoring and controlling the transportation of items. Every company, large or small, dealing with the movement of cargo must determine how they will ensure that the freight is delivered on time to the proper destination and at the lowest price that is feasible. When it comes to transport they are known as shippers, regardless of whether they use third-party companies to transport their products.

1. Load, route, and transportation optimization

If a shipper works through an agent, 3PL, or uses private fleets, it costs them money to manage empty containers or spend a lot of time in traffic. There are three primary issues shippers and carriers have to solve to run their business more efficiently.

2. Optimization of schedule and route

There are several vehicle Routing Problems that businesses solve constantly. Based on the specifics of your limitations, the type of destination or vehicle limitations, or even the traffic flow, you could use algorithms to create routes that will speed up delivery. Software for routings such as Google Optimization Tools or MapQuest offers a wide range of possibilities that can easily be integrated with your TMS through an API.

3. Planning for load

The goal of load planning is to transport as much cargo as possible with the lowest number of vehicles/trailers/containers. It is in conjunction with the optimization of routes since you must design the proper structure of goods so that they can be unloaded quicker. In addition to the route, the optimal load for a truck should be determined by weight, size and class, warehouse size, etc. Usually, you can find the information you need in load planners that are built directly into TMSs. Of course, some of these limitations are specifically related to those who use less-than-truckload (LTL) shipping, where carriers mix and match goods from multiple shippers to complete the load on the trailer.

4. Optimization of intermodal and multimodal modes

Multimodal shipping or the combination of two or more transportation modes can be more efficient and cost-effective in one country. For those who utilize third-party transporters, it’s similar to single-mode transportation as the transportation is still centrally controlled by the same company.

Another alternative can be intermodal transport in which shippers select various carriers for each portion of the route, preferring the one with the most affordable rates, the shortest transportation schedules, or even sustainability. Naturally, this places the burden of responsibility on the shippers and they would have been able to manage delays as well as oversee multiple contracts.

Do You want to Build Freight Management Software For Logistics?

Freight Management Software documents and regulations

  • Claim management
  • Regulations and Tariffs management
  • Accounting
  • Tracking and tracing shipment movements
  • Vehicle tracking via GPS
  • Package tracking with barcodes as well as RFID
  • Data collection and analysis

freight management software documents and regulations itechnolabs

1. Claim management

Freight claims assure that the freight forwarder or 3PL is financially responsible for any damage or loss to your package. Each company has its own set of regulations for filing freight claims. They can also differ according to whether it’s an international or domestic shipment. Whatever the case, you need to create a standard method for managing claims electronically to be able to respond to any damage within the normal 3 days timeframe and be reimbursed swiftly. This involves processing a claim online and preferably through an interface to the transporter, along with keeping additional documents such as bills of lading available.

2. Regulations and Tariffs management

The majority of documents for transportation pertain to air, international shipping, as well as sea shipping. Some papers include:

  • waybills,
  • bills of lading
  • packing lists (also known as packing lists (also known as customs invoices),
  • documents of origin,
  • dangerous note on goods dangerous goods notes, etc.

To assist shippers in ensuring that the goods being transported conform to government regulations such as Incoterms or 3PL contracts, the TMSs offer interfaces for data capture as well as document sharing. Electronic bill of lading capabilities, as well as integrations with e-AWB, are also feasible.

3. Accounting

Logistics and accounting for freight are integral aspects of every business that is involved in transport. Costs for freight are not much different from other costs. Cerasis lists the six components of accounting for freight:

  1. Receiving a freight quote and the freight cost The cost of shipping offered by the transporter.
  2. Receiving an invoice for freight is the invoice issued by a transporter that includes all of the essential information regarding the shipment. It must match the bill of lading, but it’s not unlike the other types of invoices.
  3. Auditing transportation and freight invoices The process to verify the legitimacy of invoices once they’ve been in an accounting program. After auditing, bills are paid.
  4. Pay for goods account payable service for transport invoices.
  5. Invoices for freight consolidation are when invoices are combined to make payments weekly instead of each day. Most often, it is carried out by freight brokers as well as forwarders.
  6. freight in, and out freight out – the cost of bringing goods into a firm and delivering them to the customers.

4. Tracking and tracing shipment movements

Software that is associated with TMS, the software for managing fleets and shipment tracking tool.

Track and trace is a term that describes ways of determining the physical location of the goods transported. Based on the amount of detail you would like to attain There are various ways to do it.

5. Vehicle tracking via GPS

A car equipped with a GPS receiver inside sends data regarding its current location to the owner company using technology for telecommunications, typically GPRS. It lets you monitor the vehicle’s moving in real time and, when integrated with electronic log devices (ELDs) as well as Telematics can provide information about

  • fuel consumptions,
  • Driving fashion,
  • temperatures inside trailers,
  • toll record,
  • open door sensors, etc.

Although it doesn’t provide information about every package, it’s helpful for scheduling and general visibility. It can help avoid delays and to share information with clients without having to contact drivers.

6. Package tracking with barcodes as well as RFID

Each pallet, parcel, or container gets a code-carrying device such as RFID chips or barcodes which allow the scanning of objects even if the code is outside the range of view. Cargo is checked at different stages of shipping, and the status of the shipment is communicated to the shipper, carrier, and client.

The two main technologies employed for data exchange in packages are API and EDI. as well as API. They are used to transfer data between systems swiftly and avoid phone calls and emails. Find out more in our article on the most efficient EDIs and APIs for tracking shipment and the best ways to integrate them into your system.

Package tracking is beneficial not just for its detailed visibility, but also because it provides useful data that can be analyzed, transformed into insight, and finally utilized to improve operational efficiency.

7. Data collection and analysis

The current network of connectivity between carriers, shippers, and other logistics companies lets us access data which will allow us to make better decisions and reduce costs. For instance, shippers have access to information that helps them plan their logistics.

  • Monitor their partner’s and carriers’ KPIs, and select the most effective ones.
  • Recognize patterns of consumer behavior and adjust the schedules to suit them.
  • Assign warehouse bays based on GPS information from trucks that arrive,
  • Compare the cost of various modes of transport and choose the best option.

But, these complex analytics capabilities can be achieved through an end-to-end BI infrastructure comprised of four components.

Data sources: They are both internal and external sources of data, such as from ERPs, TMSs, warehouse management systems, ELDs inside trucks and parcel tracking data, and more. Everything is incorporated into the system in completely unprocessed and ready to be processed or arranged, then transformed.

Integrating data: This is where unorganized data is formatted according to the internal guidelines of the business and objectives. At this point, it is important to be aware of how you would like the data to be used so that it can be organized for processing in the future.

The Data Warehouse: It’s a different kind of warehouse, but it has the same goal that data is easily accessed and searched by data analysts and data engineers who can create the data model and create interfaces.

Representation of data: Then, the end users can access dashboards and reports and use them to make better business decisions. They can be able to predict the demand of customers, carrier or driver’s efficiency, port and road congestion, and more.

For shippers who are not tech-savvy, integrated third-party analytics could be an alternative. MercuryGate TMS, for example, is a reporting engine as well as some facilities for data warehouses. Whatever way you choose to use real-time analytics, make sure you are working with companies that use ELDs or GPS to monitor your shipping at all times and also have the technology that allows them to communicate with the systems of your partners in place.

Also Read: The Future of Software Development Services in 2023 & Beyond

Do You Want to Build Custom Freight Management Software For Your Transportation Business?

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