Enterprise Software Development
Underlining The Key Features And Cost To Develop A Freight Management Software
How does freight management software help in the scalability
and efficiency of the business today? Why has the freight management system
become an important component of your business? What is the cost of developing
one? All these questions will be answered here in this article.
Whether you are looking for a white-labelled
enterprise-grade management software or want to develop from scratch, there are
a few requisite features you must have in your system. But, before speaking
about its features, let's travel to the evolution of freight management
programs.
Introduction to Freight Management Software
The inception of freight management came when freight
brokers teamed up and started using a transportation management software system
to move beyond their one-for-one transactions.
TMS was certainly helping the logistics
and shipping management services providers to quickly obtain and seamlessly
manage a huge volume of data.
This system could consolidate a heap of transactions that
can be used to perform activities and predict events. The synthesized data was
used for preparing reports for intense analysis. The logistics provider or the IT professional services
providers bottled the needful features to sell it to the shippers as freight
management software.
The development was fruitful as the shippers, who were
unable to buy the top-tier TMS, could easily purchase this solution due to its
cost-effectiveness. Freight management software helped shippers save freight
rates and operational expenses.
Today's freight management solution offers a service suite that allows the shipper to accelerate and transform the logistics and supply chain execution and strategy into a competitive advantage. Freight management solutions enable the companies to deliver higher service levels, more capacity, and lower all-in costs.
The technology platform used in a freight management
solution is cloud transportation management, which facilitates effective,
efficient, and agile coordination between carriers and shippers for on-time
delivery of products.
Also Read: How
Can the Transport Management System Help Logistics business?
Importance of Freight Management System
Today's supply chain management has become complex, and
companies require a robust solution that can allow them to quickly meet their
customer's needs efficiently while elevating their business strategies and
executions.
Efficient supply chain management leads to leaner
inventories, in-time manufacturing, omnichannel distribution strategy,
maximized customer satisfaction, reducing operational costs, and tightening
delivery windows.
Incorporating freight management solutions leverage the
shippers to deliver the freight towards the right direction at the right time
at right cost.
The global freight management system market is expected to
reach $14.3 million by 2026 (Source: PRNewswire). Freight management system
estimated $10.1 billing growth in 2020 but, the global pandemic has readjusted
the growth estimation. In the upcoming 7 years, the CAGR of increasing freight
management adoption is expected to scale 6.7% globally.
The freight management market in the U.S is expected to be $3.5 billion in 2021, while in China, it is predicted to reach $1.5 billion by 2026.
Common Drivers of Freight Management Service
For better access to freight capacity, lower operational
& freight costs, and higher service levels, companies look for reliable
transportation and logistics
software development services that can offer them an effective system. A
few drivers that increased the adoption of freight management software are -
- New technology requirement.
- Service KPIs sufferings.
- Sudden seasonal volume spikes.
- Harder internal support.
- Changing business models.
- Changes in geographies.
- Key personnel termination/employment.
- Launch of a new product.
- Lack of management of inbound freight and outbound freight
process flows.
Key Features of Freight Management Software
Outsourcing has made development as well as
post-implementation support a lot easier and cost-effective. A shipper will
have both - an inbound and outbound management program to acquire the best
results and better management. Outsourcing the business processes help
companies drive as close to seamless logistics and supply chain as possible.
Hence, your first task should be - looking for an IT strategic planning
services provider to create a roadmap for the development of freight management
software.
- Next, an efficient route and transport mode is vital for
on-time deliverance. For instance, assigning drivers & vehicles and
choosing the best route to transport your product optimizes your route.
- Paperwork is as important as route optimization, hence
ensuring government compliance of goods & transportation, including
insurance of your vehicle and service.
- Keep transparency a priority. Freight visibility offers vehicle
tracking through GPS to have complete transparency of your freight. You can
also monitor the package and container individually.
- For better business outcome analytics and reporting is
imperative. Through data collection and analytics, you can quickly optimize
your shipping process.
In order to manage your freight operations, you can either
look for a private carriage or use a third-party carrier. Depending on your
capabilities, you can decide to purchase your fleet and manage drivers. Or simply
use third-party to fulfil your goals and transportation operations.
Let’s elaborate on the underlined features to incorporate in freight management software.
1. The route, load, and transport optimization
Your software must eradicate the key problems that a
transportation business has to deal with all the time. Depending on a specific
constraint, type of destination, vehicle limitations, and traffic, your
software should be able to build safe and clear routes for faster
delivery.
Enterprise
software development companies usually incorporate routing tools such as
google optimization tool or MapQuest that are integrated with an API that
quickly connects to your freight management software easily.
Additionally, your software outsourcing partner can
incorporate a load planner tool, which encourages route optimization to check
the right hierarchy of goods to load and unload faster. Your load planner tool
can quickly calculate the size, weight, class, warehouse, & many
more.
Route Optimization with multimodal and intermodal
For faster, cheaper, and quick services, shippers generally
use multimodal shipping or intermodal transportation options. The former type
is used by the shipper, who prefers third-party carriers where movements remain
centralized and under the control of the vendor. While the latter is used, when
the shipper chooses different carriers focusing on lower rates for
transits.
2. Regulation and document management
Since the transportation industry relies on documentation,
the software must be robust enough to manage complete freight-related
paperwork. The document management is segregated into -
Tariffs and regulation management
These kinds of documentation involve international, air, and
sea shipping papers, such as waybills, bills of lading, packing lists,
certificates of origins, and dangerous goods notes. Digital bill of lading and
e-AWB integrations can help shippers ensure that goods are compliant with
government regulations, incoterms, and 3PL agreements, as well as seamless sync
with TMS.
Accounting
Accounting is imperative for any business, where a few
businesses, like logistics and transportation management business, have to
manage every day. In a transportation business, freight accounting is composed
of six components -
- Freight quote & cost - This is defined as the rate of
the shipping presented by the carrier.
- Freight invoice - A bill that contains basic information of
shipment that matches the bill of lading.
- Auditing invoices - The process audits all the bills entered
in the accounting system for their validity before payment.
- Payment - This defines the payable services for the invoice
raised.
- Consolidated invoices - This process is used by the freight
brokers for weekly payment.
- Freight in & out - This involves the shipping cost from
bringing the goods to the company to delivering them to the customers.
Claim management
One of the major risks in a freight or transportation
business is the loss or damage of the shipment. Companies associated with
different carriers have to comprehend as well as align with different rules set
by each. Instead of manually addressing them, the right
logistics management software can standardize the process claims.
The digitized claim management enables companies to quickly
respond to the damage caused after verifying the documents depending on
domestic or international shipments.
3. Data Gathering and analytics
The shippers are associated with multiple carriers and other
logistics providers. A reliable solution not just helps in making stronger
& better connections but also helps in optimized costs. Data gathering and
analytics feature can allow shippers to -
- Relate to consumer patterns and make adjustments
accordingly.
- Compare costs of different modes of transport and choose the
right one.
- Track down carriers and partners (KPIs) to underline which
one is performing better.
- Allocate warehouse bays.
In order to perform complex analytics, you can always look
for an IT consultation
services provider to incorporate end-to-end BI infrastructure, such as -
Data integration - to organize the data as per company
rules and goals as well as use them for future processing.
Data representation - offers a clear representation of data
through reports for the end-users to assist them in making an informed
decision. The data can also be used for predicting customer demand, carrier and
driver performance, road and port congestion & more.
Data sources - include internal as well as external sources
of data, such as TMS, ERP
solutions, warehouse management systems, ELD in trucks, parcel tracking
data, & other third-party applications. The data retrieved can be filtered,
organized, and transformed for future management.
Data warehouse - allow data engineers & analysts to
quickly access the data for preparing data models and interfaces.
4. Tracking and Tracing Shipments
Transportation is a kind of business that demands tracking
and tracking the location of its goods as well as a vehicle to ensure reliable
and timely delivery of goods. A good and most commonly used way to track
shipment is through GPS. Other than GPS, barcodes and RFID are also used.
GPS tracking
The GPS-incorporated vehicle leverages the shipper to
observe every movement of the vehicle. The technology sends current location
data to the parent company. When the technology is combined with the electronic
logging devices (ELDs) and telematics, a shipper can retrieve detailed
information, such as driving style
- Fuel consumption
- Toll records
- Open door sensor
- Temperature inside trailers, & much more.
This type of data can help in scheduling or general
visibility to avoid delays or share information of the driver with the
customers.
Barcode and RFID tracking
This technology can be used to provide precise and detailed
tracking, which includes - each parcel, pallet, and even the containers
received with barcodes or RFID chips. RFID chips and barcodes can be quickly
scanned and send the status of the shipment to the client to ensure the
deliverance of the goods.
Here, predominantly EDI solutions and API
integrations are used to make the exchange of information between different
systems real quick.
With Barcode or RFID tracking technologies, large
enterprises can have quick and detailed visibility into their valuable data for
further analysis. The data can be transformed into insights using TMS and then
applied for making operational improvements.
Cost and Process of Freight Management Software
Most transportation
management software operates the same way. The below table outlines the
process of complete freight management.
Any development stage begins with the discovery phase that
takes up to 2 weeks. The next step is followed by the user interface and user
experience design that also lasts up to 2 weeks.
After the two processes, programming begins with the
front-end and back-end development. Based on a minimal set of requirements, the
full circle of development may cost $200K approx. This phase may take around
6-8 months. Any supplementary service, such as mobile apps for clients and
drivers, may cost extra (say around $90k)
After the development part comes the testing part. The
testing part is conducted by the qa testing
services providers who perform both manual and automation testing for
quality assurance.
Deployment is the launch of the software, whereas post-launch support is to give long life to the software by timely bug fixing and integrating new features to the software.
So, choose your priorities for successful development and
connect with A3logics to develop a
robust and scalable freight management solution for your business.