A transportation management system (TMS) is a critical piece of software for carriers. A TMS can help improve carrier operations in a number of ways, including improving efficiency, reducing costs, and increasing customer satisfaction. To get the most out of TMS, it is essential to select the right software for your needs and to understand the features and benefits that are most important for your business. 

This article will provide an overview of the TMS software market, including a discussion of the top five things to look for when selecting a TMS and questions to ask before purchasing.

What are Transportation Management Systems?

Transportation management systems are software applications designed to help carriers manage their operations. A TMS can be used for various tasks, such as planning and scheduling transportation resources, tracking shipments, and managing customer relationships.

In many cases, transportation management software will also include features for accounting and invoicing, asset management, and compliance with regulatory requirements.

How Does Transportation Management Software Work for Carriers?

A TMS can help carriers improve their operations in a number of ways. Perhaps most importantly, transportation management software can help to improve efficiency and reduce costs.

By using a TMS, carriers can plan and schedule their transportation resources more effectively, reducing delays and disruptions. In addition, a TMS can help carriers track their shipments and monitor their progress, which can help to improve customer satisfaction.

How Much Does TMS Software Cost?

Transportation management software costs vary depending on the included features and functionality. However, TMS software is typically priced on a per-user, per-month basis. As such, the cost of TMS software will generally increase as the number of users and the amount of data that is managed by the system increases.

Do Carriers Use TMS?

Most carriers use some form of carrier management software to manage their operations. However, the features and functionality included in a particular system will vary depending on the carrier’s needs. As such, selecting transport management software that is well-suited for your business is important.

For instance, some TMS software solutions are designed specifically for small- to medium-sized carriers, while others are meant for enterprise-level organizations. In addition, some TMS systems are geared toward specific industries, such as food and beverage or transportation operations.

For example, a food and beverage carrier might need a TMS that includes features like temperature tracking and route planning and optimization. On the other hand, a trucking carrier might need a TMS with features like load boards, tracking freight costs, and electronic logging devices (ELDs).

When it comes to choosing a TMS, it is important to consider your specific needs and requirements. Otherwise, you might end up with a system that is not well-suited for your business. The best transportation management systems will provide excellent transportation logistics out of the box, but customization might be needed to reach your objectives.

How can a TMS Improve Carrier Operations?

There are many ways in which a TMS can improve carrier operations. Here are some of the most important to familiarize yourself with when evaluating top transportation management systems.

  1. Route planning
  2. Route optimization
  3. Order management
  4. Workflow automation
  5. Fleet management
  6. Load management
  7. Shipment tracking

Perhaps the most obvious benefit of a transportation management solution is cost reduction. This can be achieved in a number of ways: by improving efficiency, reducing downtime, or eliminating the need for manual processes.

In addition, a TMS can help to improve customer satisfaction. A TMS provides carriers with shipment tracking and monitoring. In doing so, carriers can send their customers up-to-date information about the status of their shipments. This, in turn, can lead to fewer customer complaints and higher satisfaction.

A TMS can help carriers comply with regulatory requirements. In many cases, a TMS will include features for tracking shipments and managing compliance documentation. By using a TMS, carriers can ensure they comply with all relevant regulations.

Transportation management systems can also provide fleet management to improve operational efficiency for carriers. Understanding how to keep your fleet conditioned for optimal operations is critical. Fleet optimization with just a few clicks can save valuable time and reduce the resources needed to keep fleets running effectively.

There are more than just these benefits; these are some of the most important ones that a TMS can offer carriers. If you’re thinking about purchasing a TMS, make sure you keep these in mind.

How to Select the Best TMS for Your Carrier – Top 5 Things to Look For?

When it comes to choosing a TMS for your carrier, there are a few things you’ll want to keep in mind. Here are the top five things to look for:

1. Ease of use: The last thing you want is a complicated system. Look for one that’s easy to navigate and understand. The system should have a user-friendly interface.

Your drivers should be able to find the information they need without difficulty quickly. Or, if you have a small carrier, you might want to consider a system that doesn’t require a lot of training.

2. Cost: Of course, you’ll want to consider the cost of the TMS. But remember that the most expensive system isn’t necessarily the best transportation management software for you. Look for a TMS system that meets your needs and fits your budget.

3. Integrations: Make sure the TMS you choose can easily integrate with your current systems or third-party software you already use. You’ll spend more money refactoring your systems if you select the wrong TMS solution.

4. Flexibility: The best TMS solutions are flexible and can be customized to meet your specific needs. For example, when shipping freight, you should be able to track different load types, such as partial, full, or LTL. In addition, the system should be able to accommodate your unique business processes.

5. Customer support: When something goes wrong with your TMS, you’ll want to be able to get help from the customer support team quickly. Make sure the company you choose offers 24/7 customer support. In addition, look for a company that has experience in your industry.

Questions to Ask Before Purchasing TMS Software 

During the research and comparison process of selecting a TMS software for your trucking company, keep the following in mind as you gather vendor data.

  • What are my total supply chain costs? A comprehensive TMS will track your transportation spend and all related logistics costs, including warehousing, packaging, freight forwarding, etc. This information will give you increased supply chain visibility into your spending and allow you to make more informed decisions about where to allocate resources.
  • What is the system’s flexibility? As your business grows and changes, will the TMS be able to adapt? Look for a system that can be customized to meet your needs now and in the future.
  • What is the system’s scalability? If you’re planning for growth, make sure the TMS you choose can accommodate an increase in volume. 
  • How easy is it to use? You and your employees will be using the TMS on a daily basis, so it’s essential to select a system that is user-friendly and easy to navigate.
  • What is customer service like? If you encounter a problem or have a question, will you be able to get the help you need in a timely manner? Find out what support is available and how long it typically takes to resolve issues.
  • What are the implementation and maintenance costs? In addition to the initial purchase price, find out what you can expect to pay for implementation, training, and ongoing maintenance. Will you opt for a cloud-based solution or on-premise?
  • What are the system’s reporting capabilities? You’ll want to be able to generate various reports to track your progress and measure your success. Find out what reports are available and how easy it is to generate them.
  • What are the system’s security features? Security is a top priority, with sensitive customer data stored in the system. Ensure the TMS you select has robust security features to protect your data.

Now that you know what to look for, you can shop for TMS software. Just remember to keep these critical factors in mind as you compare options.

TMS solutions offer critical tools for trucking companies, but it’s important to research before purchasing. Remember these factors during the selection process to ensure you choose the right system for your business.

Final Thoughts

If you run a trucking company or manage carrier relationships, you’ll likely find you’re in the market for a transportation management system. A TMS will help you save time and money by streamlining your operations and improving communication between you and your customers. 

When choosing transportation management software, be sure to consider your company’s specific needs. Look for a system that is flexible, scalable, easy to use, and comes with excellent customer support. Also, be sure to get a system that fits your budget.

With so many TMS software options on the market, it can be challenging to know where to start. Use this guide to narrow your options and find the perfect system for your carrier. 

Managing the logistics side of any business is hard work. Thankfully, plenty of software solutions are available to help make this process easier and more efficient. Most companies use logistics software, but more often than not, they do not use it to its full potential.

Knowing how to get the most out of your logistics software can help you save time and money and make the whole process more organized. The problem is that many people are still unsure how to use this software best. This article covers all there is to know about logistics software and how to implement it efficiently. 

What is logistics software? 

Logistics management software is software that is meant to help you keep track of the entire logistics process. It is software that enables you to manage the many aspects of a logistics system, from keeping track of vendors to delivery dates and even transportation details. It helps you organize the entire process and efficiently keep track of your data. 

Most businesses with a logistics department usually use some form of logistic software. Some companies might even just use Excel files to keep track of all these details. But if you’ve ever worked with logistics on an Excel file, you know it can quickly get out of hand. There’s simply too much to keep track of simultaneously. 

The first step to using your logistics software efficiently is understanding precisely what it is and what it is meant for.

What does logistic software do?

Logistics software keeps track of all the data involved in the varying sectors of logistics operations. The logistics side will differ depending on the kind of company you work for. For instance, the supply chain sphere will have logistics software to handle form orders and distribution details within the company, keep track of documents and payments, and issue receipts for purchases, etc. 

Similarly, a transportation company or the transportation sphere of logistics might have software that keeps track of transportation orders, offers a portal to interact with customers and store customer history, plans costs and delivery times, reports which deliveries have been completed, etc. 

On the other hand, a warehouse might have software that handles the management of supplies, planning of storage space, labeling and arranging the supplies, monitoring operations in the warehouse, and managing the employees or personnel inside the warehouse. 

You use the software to plan and organize the vast amounts of data required for these processes to run smoothly. For instance, suppose you work at Amazon. You have thousands of orders coming in every day. There is a lot to keep track of to ship these orders fast and on time to the correct locations. 

Logistics software handles all tasks to keep track of everything, from which vendors to get the product from, which transportation will be used to ship the product, and customer details like their address and contact numbers. 

When you think of the sheer number of orders that must come into Amazon, you’ll realize how important this kind of software is. It’s impossible to streamline this process and work efficiently without logistics software. Amazon, for instance, has its own logistics software developed to suit its needs. 

This software is meant to optimize the logistics department processes of any enterprise company. It can be customized to fit any sphere, and the best logistics software is usually customizable to suit your specific needs. 

What are some key features of logistics software?

Today’s logistics software offers many different features, whether order management or warehouse management. With your logistics software, you can manage and keep track of inventory, supplies, delivery details, etc. Many even have predictive features that use AI and past data to predict future demands. 

There are a lot of features that different logistics software companies offer. Out-of-the-box software might provide the core elements your business needs, but the best results are often custom solutions that integrate your needed features. Evaluate the customization options when reviewing your logistics management software solutions. Here are some of the custom elements provided by logistics management software.

Billing management 

While many features may differ according to what kind of logistics sector you work in, one area that should be common among all logistics software is the billing management system. Businesses have a lot of invoicing needs. Whether invoicing clients or paying bills yourself for supplies, keeping track of the receipts is essential. 

Dealing with a high volume of orders can become next to impossible if you attempt to do it manually. Your logistics software should allow you to receive orders automatically, schedule, process, and generate invoices. 

For instance, you should also be able to track orders and be notified once they have shipped. Even integrating payment gateways into the software can be a helpful feature. A centralized payment system is vital for tracking expenses and sales income. 

An efficient ordering, billing, and payment feature is essential in any reputable logistics software. It should ideally be highly customizable; i.e., you should be able to edit and customize which fields you want and what kind of information you want to store and create an interface that supports your specific business functions.

Flexibility 

Flexibility is essential in any software, but this is especially true for logistics software. Certain aspects of the logistics process can often be uncertain or subject to change. Your software should allow you to make those changes easily or, better yet, account for those changes automatically. 

The software should evolve along with the business and grow and develop in its functionality as the business evolves.

How you use your software should also be flexible. Logistics service providers will have options for you to use the software in the manner that best supports your use cases. It might mean having a mobile version or an app where you can make small changes to the system from your phone if you don’t have access to a computer. 

It can also mean that the software should support different operating systems. You might need to change OS preferences for security reasons. Having broad support for the software can also be a great feature. 

Optimization tools

When dealing with logistics and transportation, your main goal is to save money however possible without compromising on the quality of service. You have to choose the most cost-effective methods for each step in the process. 

This is where optimization tools can come in handy. Your logistics software should offer different tools to optimize your logistics process. The main focus of logistics software is the transportation of the products.

In many cases, this can be very expensive. Your software should help you choose the optimum route for each delivery to allow for cost savings. For instance, if one trucking company can ship your products in 5 days and another in 2 days, your software should automatically choose the one that ships faster unless you have to pay extra for fast shipping. 

The software should be capable of analyzing the situation and providing you with the best possible solution on a mass-production scale. This process would be very time-consuming to do manually. Thus, automation in this area of optimizing your operation is critical for success. 

Optimization tools work to give you the best possible solutions to your problems. It also should help you avoid errors in your data, which can lead to more significant costs. In logistics, mistakes are common and can often be very expensive. Therefore, proper documentation and upkeep of data are essential to avoid errors. 

Real-time visibility 

Logistics software should work well across various sectors and give you real-time data. From ordering goods to dispatching. Real-time visibility can help you make better stock and warehouse inventory management decisions.

Logistics software should update in real-time to changes that may occur in any aspect of the logistics process. Clients would appreciate it if you could tell them where their order is or what process it is going through. It’s also well-suited to quickly arrange for last-minute cancellations or changes to orders. 

Keeping up with local laws and regulations can help you save money on transportation and shipping. There are a lot of minute costs associated with these processes that your software can help you reduce. Therefore, your logistics software should offer complete, real-time visibility across all aspects of your logistics operations. 

Forecasting tools

A lot of logistics software nowadays integrates AI into their algorithms. With the vast amounts of data and analytics logistics software stores, artificial intelligence can help the software predict specific demand forecasts. The software performs this by finding patterns within the data, i.e., order history and past buying behavior.

This can help plan future shipments and help develop stronger client relationships. It’s a great tool for client retention and acquiring new clients. Using AI in this manner can personalize the customer experience and thus build rapport. 

With forecasting tools, you get detailed insight into your own business: your procurement cycles, how many resources you use each term, how much delay you can expect in different processes, and the costs involved in your logistics. With complete insight, you can build a better, more effective logistics strategy for the future and develop better products. 

Smooth integration

A lot falls under logistics, so there’s a lot that can go wrong. It’s essential, therefore, that your software integrates each of the sectors involved in logistics. 

Certain businesses choose to use different software for different aspects of logistics. They use delivery management software, order tracking software, etc. If so, you want software that seamlessly integrates and works together.

Communication between parties should be seamless, and the software involved should reflect that. Better communication means fewer errors and better productivity. 

Supply chain efficiency

It’s crucial to have software that helps you manage supply chain efficiency. The software should handle the flow of products and services, beginning from the manufacturing process through to the delivery process. 

A centralized dispatch dashboard is a feature in your logistics software to keep track of deliveries being sent to the right place. A robust cash management system is also essential in helping the supply chain process workflow.

Additionally, a fleet tracking feature is valuable to help you track shipments. The transportation management system should be able to track shipments globally on land, sea, or air.

Using reporting or analytics tools in your logistics software is another way to strengthen your supply chain more efficiently. Accurate reports can help you gain insight into supply chain operations and allow for better decisions. 

Management of warehouse facilities 

Your logistics software should ideally have a warehouse management feature for warehouse operations. Not all logistics software solutions will provide WMS capabilities, but those will best serve your supply chain management needs.

There is no overstating the importance of inventory control and tracking. Supply chain management software sometimes disregards the warehouse management aspect, but that oversight can cause customer relationship management nightmares if packages are lost in transit.

A digitized inventory system lets you get updates about any leftover shortages or stock. It allows you to speed up the courier dispatch services and thus have a much more efficient supply chain, which also, in turn, can lead to higher levels of customer satisfaction.

Who uses logistics software?

Logistics software benefits almost any kind of business and can help make the transportation of products much more efficient. Traditionally, Trucking companies, Third-party logistics companies, Freight forwarding companies, Transportation companies, Warehouses, Production houses or factories, and Retailers are the types of businesses that invest in the best logistics software solutions.

Any business transporting goods from one place to another can leverage logistics software. However, many more companies are integrating logistics software into their workflow for its many benefits. With the advent of AI and the number of customization options available in the software, companies can use it specific to their needs and goals. 

10 Steps to put logistics software into action

Now that you have a solid understanding of logistics software and how to use it for your business, let’s go over how to implement a logistics management system.

Step 1: Make a list of your needs

Whether you already use existing logistics software in your company and want to make better use of it, or you’re considering introducing new software, you must have a clear idea of your requirements. 

Start from the beginning of your logistics operations process, the order placement, and then, step by step, work your way through the delivery of the product. You should analyze every step that falls in between, especially when transporting the product. 

The first step doesn’t necessarily have to translate to a digital task. Address the problems you are facing and note them, and then you can narrow down the logistics companies with logistics management solutions to solve those problems. 

This exercise will help you pinpoint precisely what system requirements you have for your operation. This requirements document will help you shop for the right logistics management software and find logistics companies that are top providers and aligned with your needs.

Step 2: Check out the competition 

If you are a new business owner or just learning how logistics can evolve your operation, you can research your competitors to see how they handle the logistics in their companies. Take a look at the industry leaders and what software they use. What kind of features do they have? Do they use custom software, or is it out of the box? 

Doing proper research will help you better understand how things work and what the software looks like. It will also help you get reviews of the various software options, on-premise and cloud-based software. You will learn which features you need and which are nice to have.

Narrow to a few top logistics providers and match them with your system requirements. 

Step 3:  Decide on custom software, a subscription, or outsourcing

Once you have a better idea of your requirements and options, you can decide whether your business will benefit more from a custom or pre-existing design. You can hire an IT team to develop your logistics software from scratch. A lot of big companies like Amazon have done this. 

The perk of this approach is that you can build software that works how you want it to. This approach allows you to build a system specific to your requirements and to save on aspects you will not need or use.

The obvious drawback to this solution is that it is costly to build, develop, deploy, and maintain your software. It also takes a lot of time. While this is a viable option for larger companies, most businesses are content with using any pre-existing logistics software available on the market. 

There are a lot of varieties and different target markets and niches. Ensure you select one to meet your logistics management needs. Some of them also provide customizations to a certain extent so that you can change the features to meet your needs. 

You can also choose to outsource your logistics software needs to transportation companies. This method is primarily effective for new start-ups and small businesses that might benefit from the other services that third-party providers offer. 

Step 4: Choose between cloud or on-premise solutions

Next, you need to decide where to store your software. You can use in-house facilities or installation on local servers or choose to use cloud alternatives. With an on-premise approach, you will receive greater security and control over your software.

However, a lot of hardware and maintenance is involved in maintaining an in-house logistics software system. Cloud-based software services have a much lower starting cost and do not require hardware. It also allows you to access the software from anywhere in the world.  

Step 5: Determine the functionality

You can now decide on the modules you want in your software based on the requirements analysis you’ve performed. There are tons of modules you can go for. Some of the common ones are:

  • MES-Manufacturing Execution System
  • TMS-Transport Management System
  • SCM-Supply Chain Management
  • CRM-Customer Relationships Management
  • WMS-Warehouse Management Systems
  • AEM-Enterprise Asset Management

Step 6: Choose a vendor

Now that you have a concrete idea of what software you need, you can choose a vendor you like. You can contact us at 3G for Transportation Management System quotes. Remember to set up an appointment to discuss your requirements and budget. 

If you opt for the custom development route, this is where you give the execution over to the IT development team. They will build your system within the discussed time frame. 

Step 7: Training process

With any software as extensive as logistics, there is a learning curve. There will be a need for training users on the system and for day-to-day operations. The logistics team will need the most extensive training on how the system works and how to use the software to its full potential. Usually, the vendors or the developers will guide you through this process.

Other employees might only need to learn to use the separate aspects of the software. For instance, warehouse employees may only be trained on the system’s inventory tracking and management aspects. Remember that a cross-trained organization has many benefits over a silo-trained team. 

Step 8: Probation period

With the new software, a soft launch is often a good idea. This means you test the software on a smaller scale with a dedicated team before deploying it across the organization. This period can go on simultaneously during the training period. 

This probationary period will determine which features work well and which might need adjustments. It can also show flaws within the system and help you make changes to fix minor issues. Since this is a significant investment, it can be challenging to change routes, but in the long run, it’s better to make changes now than suffer loss later. 

Step 9:  Measure success

Especially during the first few months, it’s essential to see if your software is helping you run the business more efficiently. Use different KPIs to measure the improvement. Some software can also provide reports on overall time and cost management advances. 

Step 10:  Keep evolving

Business is ever-evolving. It grows and changes, and your logistics software should grow and change with it. If you use pre-designed software, chances are you will get regular updates from the company itself. You can also perform periodic checks to see if there is any room for improvement and report that to the software providers. 

Keeping your software updated and running on the latest versions allows you access to new features that might help the business. Always update the software as the business grows and keep it secure.

5 KPIs and ways to measure success

It’s essential to see measurable results when investing significantly in logistics software. It’s expensive, so you need to know whether it is helping. Here are 5 KPIs to help you measure the success of your logistics software. 

Shipping time

Using logistics software should improve your shipping times significantly. Shipping time refers to the number of orders you have shipped within the requested time divided by the total number of orders. 

With a streamlined logistics process, shipments should increase in speed and accuracy.

Order accuracy

This KPI measures how many orders were correctly delivered without any problems along the way. With logistics software, your orders should be digitized and processed automatically, thus reducing human errors along the way. 

The higher the rate, the better your software is working. Ideally, you want your orders to be accurately delivered without any issues. 

Transportation costs

Due to the optimization tools of your logistics software, using this software should significantly reduce your overall transportation costs, including the expenses of transporting the product from order processing to delivery. 

Ideally, you should measure the costs of the different categories involved in transportation and see if any sector is costing more than usual. 

Inventory to sales ratio

This ratio measures how much inventory you have compared to how much you can sell. It is a ratio that depicts the financial stability of your business and helps you determine whether you are overstocked or can handle unexpected situations. 

While there is no correct inventory-to-sales ratio, and the target ratio depends on your business goals, a good ratio is usually not too high or low. This should reflect the use of your logistics software. Your software will also help you calculate this ratio much more accurately. 

Warehousing costs

Another important KPI is the warehousing costs associated with your business. Warehousing costs involve everything from storage to moving the goods within the warehouse to the payments of employees and energy costs. The software will help you determine these costs much more efficiently. 

Your logistics software should also help you reduce warehousing costs, as you have a better idea of real-time inventory. Therefore, you can reduce waste and only stock what you need.

How can logistics software benefit your business?

Logistics software can benefit your business in a multitude of ways. It helps reduce delivery times and makes transportation much more efficient and quick. By using optimization tools, you can reduce delivery times by days. It also helps prevent human error and altogether enables you to save money. 

The different KPIs discussed above indicate how many ways logistics software can benefit a business. It makes it easier for your employees to handle their work, and you can better track all the processes inside your company with real-time data visibility. 

This software helps you choose the best possible option to manage shipments, especially across modes of transportation and route optimization, and it can make this judgment based on several factors, not just cost.

How much does logistics software cost?

Logistics software can cost anywhere from 200 USD to 800 USD per month. However, since so many varieties and customizations are involved, it’s hard to provide an accurate cost estimate without discussing your specific needs. Your subscription prices will vary depending on the tasks you will need your software to perform. 

To get an accurate quote, you can always contact us at our customer support and discuss your logistics software plans, and we will recommend a suitable solution along with how much you might have to pay each month. 

Final Thoughts

Implementing logistics software can change your business for the better. Managing the entire supply chain without the proper software is challenging as your company grows, be it limiting errors or allowing you to make smarter, more effective decisions. 

A scalable logistics software solution can effectively streamline the operations of a business that wants to enhance its delivery operations or how it works with third-party logistics providers.

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Optimizing Frontline Efficiency: Transportation Software Suites in Shipping Technology 

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Amid the fast pace of today’s logistics and transportation market, shippers are under increasing pressure to enhance efficiency and control costs. The frontline workers responsible for critical tasks like route planning, overseeing compliance, or driving vehicles can no longer keep up with the pace of the industry using just spreadsheets and manual systems. Transportation software suites — particularly those providing an all-encompassing array of tools for transportation management, shipping, and seamless integrations — are rapidly becoming essential for companies striving to remain competitive in this marketplace

As a result, what really creates a competitive advantage isn’t just digital transformation, but how easily a transportation software solution can be integrated into an operation. In this environment, frontline workers need low learning curves, streamlined user experiences, and fast onboarding. Finding ways to identify and concretely address those needs is critical to success. 

Why Frontline Workers Struggle With Transportation Technology 

Software developers have created several transportation technology solutions to help shippers streamline their operations and control costs. However, the design and user experience these platforms offer leave a lot to be desired, often creating new layers of inefficiencies and challenges to deal with in addition to critical business processes. Some of the biggest struggles frontline workers face with their transportation technology include: 

    • Difficulty Onboarding 
      Despite their ability to streamline route planning and other critical processes, users often struggle with difficult onboarding processes for new carriers, customers, or services. Unnecessarily complex onboarding can slow down workflows and impede sales. 

    • Limited Functionality 
      Some platforms lack the necessary features to unify processes, requiring the use of multiple, disparate systems across less-than-truckload (LTL), truckload shipping (TL), parcel, and drayage services. 

    • Lack of Integrations 
      If a transportation suite doesn’t allow API or other types of integration with the systems frontline workers use regularly, then they will require more manual touchpoints to fill the gaps in automation, hindering efficiency gains. 

    • Poor Analytics Capabilities 
      Platforms that silo processes from each other or fail to integrate with other systems lack centralized data visibility, requiring much more labor-intensive processes to glean any kind of analytics insight. 

What Frontline Workers Actually Need From Transportation Technology 

These challenges highlight the features frontline workers need to compete effectively in the logistics market. The key is to look for a transportation software suite that meets these criteria: 

Intuitive and Simple User Experiences 

Platforms with a user-friendly interface are easier to navigate and reduce the need for extensive training, allowing users to quickly understand the system’s functions and begin using it effectively. Systems that enable customized views enhance productivity by allowing users to organize their workspace according to their specific needs or preferences, improving decision-making processes and overall efficiency. 

Comprehensive Functionality 

Transportation technology should be able to help users tackle every type of task and process related to logistics and shipping, eliminating gaps in automation. Frontline workers need platforms that can easily plug into their operation right out of the box, while still being easy to customize to their specific needs over time. 

Cloud-Based Infrastructure 

In today’s business landscape, cloud-based systems are critical for ensuring easy and convenient access to distributed workforces. The infrastructure also makes it easier to troubleshoot with customer service, minimizing the impact of software issues and resulting downtime. Developers can also automatically roll out product updates and new features without any delays in user adoption. 

Robust Integration Capabilities 

By utilizing APIs, EDI, and other connection technologies, a transportation suite should be able to easily integrate with various systems to exchange critical information efficiently. This ensures seamless connectivity between systems used for shipping, both within an operation and with external stakeholders such as customers and carriers. Integrations help expedite the onboarding process for carriers by automating the collection of essential information, streamlining operations, and improving overall efficiency. They’re also foundational for improving visibility and collaboration across the supply chain. 

A Suite of Transportation Solutions 

End-to-end process handling is crucial for businesses to streamline their operations. Choosing a provider that offers a full suite of solutions allows customers to manage all aspects of shipping, from order placement to delivery, with a single technology vendor. Comprehensive solutions also enable more robust data collection and analytics, displaying real-time information about carrier performance metrics, current pricing information, and other data crucial for informed decision-making. 

3G: The Transportation Software Suite Frontline Workers Need 

In the highly competitive logistics market, ease of use is just as important as the types of processes they automate. Shippers must choose platforms that meet the user experience and implementation needs of their frontline workers who will interface with the technology daily. Failure to do so can result in wasting money on a solution that workers struggle to adopt. 

What’s more, effective technology implementation plays a direct role in improving working conditions and increasing job satisfaction. After upgrading their transportation software, Okuma Fishing was not only able to grow the size of their workforce, but they were also able to improve retention among existing employees. For Tiger Tail USA, their shipping software of choice helped their workforce maintain a sense of continuity and familiarity during a period of rapid growth and significant change. 

3G’s Transportation Software Suite offers a streamlined, intuitive user experience with comprehensive functionality, robust integrations, and breadth of solutions frontline workers need to succeed in their roles and achieve full efficiency. Want to learn more? Read more about why 3G is the ultimate transportation management software

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Publish date

April 10, 2024

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Shippers

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How the Right Transportation Management Software Can Reduce Labor Costs 

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As digital transformation continues to accelerate customer expectations for shipping speeds, inefficient, manual transportation management can be devastating to productivity. On top of slowing down processes, operations that rely on spreadsheets and cumbersome management methods quickly rack up unnecessary costs from inefficiency, especially when it comes to labor. That’s why transportation and shipping software is so important: it can provide frontline workers with the tools they need to work more efficiently, streamline operations, help optimize routes, automate processes, and even help small, medium-sized, and large operations function at the same level.

The right transportation and shipping software doesn’t just streamline operations and reduce different types of transport costs — it can generate significant savings on labor expenses at a time when profit margins need extra protection. Here’s what you need to know about reducing labor expenses and transportation costs with the right software.

How Transportation and Shipping Software Reduces Labor Costs  

Implementing a transportation and shipping platform is essential for streamlining operations and reducing transportation costs amid record-setting inflation. However, making processes more efficient through digitalization doesn’t just make life easier for employees — each of these benefits plays a direct role in reducing labor costs as well:

Streamlined Route Planning and Carrier Consolidations 

Manual logistics planning requires employees to painstakingly track variables like delivery schedules, vehicle capacities, and traffic conditions to create the most efficient and cost-effective routes and shipments. With such an overwhelming amount of information to juggle, not only do workers make more mistakes in planning — but the menial work also eats up a lot of labor hours. 

Transportation and shipping software automates route planning, scheduling, and carrier consolidation by using algorithms to easily identify opportunities to optimize each delivery. This eliminates much of the most mentally taxing work involved in planning and scheduling, which is especially important for small operations where the workforce may already be overutilized, and saves time in addition to reducing errors. By deploying transportation software, companies can easily scale their shipping volume without straining or expanding labor resources to maximize profit margins. In fact, BarProducts.com was able to reduce their labor expenses by 75%, and even lowered their error rate in the process. 

Reduced Administrative Burden 

When using spreadsheets and paper-based systems, employees have to manually enter and manage order, shipment, and invoice data — all critical and time-consuming work that can take many labor hours. The time and effort involved in coordinating with carriers and managing compliance documents only exacerbates labor and different types of transport costs — especially as shipping volumes increase. 

Transportation and shipping software can automate a lot of the tedious administrative processes involved in these operations,  streamlining order entry, shipment tracking, and invoicing, and virtually eliminating manual data entry and paperwork. By automating these tasks, the software not only reduces the risk of errors — it helps employees get more done in less time.

Automated Invoicing, Auditing, and Settlement 

A key benefit of transportation and shipping software is that it helps streamline the entire order process, including invoicing, contract management, and other key financial processes, all the way from the initial order to final settlement. Many platforms feature built-in auditing so users can easily track the status of any transaction within a single user interface.    

The software can also automatically deliver updates about order status, enhancing customer service metrics. Automating these communication tasks doesn’t just improve customer satisfaction and collaboration — it also frees workers to use their time more efficiently and focus on more value-driven tasks that increase revenue.

Integrations

With manual transportation management processes, employees must painstakingly move or replicate information across the different systems they use for order tracking, route planning, and other critical tasks. Integrations enable users to automatically export or sync data with other systems, reducing the need for manual data entry and the risk of errors, unifying workflows, and even expanding the types of services available to customers. This capability reduces time wasted and improves overall productivity, dramatically reducing labor and transportation costs in the process. 

3G: The Right Transportation and Shipping Software for the Job 

Controlling labor and transportation costs is critical for shippers to remain competitive in today’s ultra-efficient logistics environment — regardless of the size of their operation. Leading-edge transportation software can be a game-changer for companies that have outgrown spreadsheets and other manual methods of tracking their shipment. 

3G offers a full suite of software solutions to help optimize routing, trailer packing, carrier selection, invoicing, and other critical business processes — all crucial to holistically reducing labor and transportation costs. Experience the 3G difference with a free product demo. 

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April 10, 2024

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Recurring Costs Associated With Legacy Transportation Management Software in Shipping 

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Supply chains are only becoming more complex in terms of scale and the speed with which they move goods. With each passing day, we also see more and more of how limiting it is to use manual systems and track shipments with multiple tools, making it difficult to handle the high volume of shipments necessary to compete in this landscape. This gap in performance is now leading to inefficiencies, a high number of errors, and a lack of real-time visibility into the supply chain. 

When you continue to rely on manual systems to manage your shipments, you’re not just slowing down processes and inconveniencing employees — you’re also incurring tangible and unnecessary expenses for your operations, eating into profit margins and long-term success. Digital transportation management solutions are key to breaking through to higher profit margins. 

The Cost of Legacy Transportation Management Solutions 

Software has evolved to streamline every aspect of transportation management, but many shippers still use paper-based logs, spreadsheets, email chains, and phone calls to get everything done. Even when operations utilize more advanced digital tools, capabilities can be spread out across multiple solutions, creating more manual touchpoints and data silos. These inefficient methods of managing shipments use a variety of techniques and tools, but have one thing in common: They’re time-consuming, labor-intensive, and much more costly than necessary. Using these systems not only hinders your company’s productivity but can also incur additional expenses. 

Increased Labor and Administrative Costs 

Using spreadsheets and manual paper systems to manage complex shipments, order processing, invoicing, and auditing is incredibly labor-intensive. All the extra time workers spend on basic processes adds up to higher labor and administrative costs. In addition, when shipping routes aren’t planned for maximum efficiency, workers may need to build out and process extra shipments to meet order requirements, potentially increasing shipping costs over time. As automation comes to define the industry more, the legacy methods lacking streamlining capabilities dramatically increase labor budgets. 

Higher Shipping Costs 

Because manual processes are so time-consuming and cumbersome, they often hinder decision-making and lead to suboptimal planning. Trying to keep track of so much data in different files, it can be easy to overlook the best routes or identify the best carrier rates, leading to missed opportunities for savings. As a result, shippers might select more expensive carriers or inefficient routes, ultimately increasing overall shipping costs for companies. 

Excessive Inventory Costs 

Across the board, a lack of real-time visibility into inventory levels and efficient routes can cause shippers to hold more inventory than necessary, leading to increased warehousing and other costs. It encourages shippers to maintain higher inventory levels to avoid delays, requiring more storage space to hold the excessive inventory, ultimately increasing storage costs and tying up cash in items they might not need. The inefficient routing associated with legacy systems also leads shippers to build up safety stock to avoid delays in customer orders. 

Unnecessary Fuel Spending 

In addition to keeping drivers out on the road longer than necessary, poor and inefficient route planning extends mileage, resulting in higher fuel costs. The poor route visibility associated with legacy systems can also make it easy to overlook retailers with better fuel rates, causing drivers to spend more at the pump on top of driving unnecessary miles. 

Surprise Fees and Charges 

When routes aren’t optimized, drivers are likely to face delays in loading and unloading, resulting in detention fees and other charges from carriers. Drivers must also follow strict regulations about the number of hours they spend on the road before needing a break. Poor route planning can increase the number of layovers they require, potentially incurring additional costs. These unexpected fees add up quickly and can have a substantial impact on transportation budgets. 

Higher Risk of Error 

Manual spreadsheet and paper log systems create a higher risk of human error in order processing (such as delivery address data and shipping piece counts), or in meeting regulatory compliance standards, such as documenting driver hours of service, emissions data, and vehicle maintenance. Small mistakes can result in costly fines and penalties from regulators. What’s more, compliance mistakes with carrier and partner contracts can jeopardize relationships and even leave shippers open to lawsuits or lost revenue. 

Escape Recurring Costs With Transportation Management Solutions 

Spreadsheets, paper logs, and other manual transportation management methods may be cheap to implement, but the inefficiencies and errors cost shippers dearly in the long run. And unfortunately, upgrading to multiple digital solutions can leave your workflow just as scattered and cumbersome. What shippers really need is a unified transportation management solution that allows users to implement more automation, consolidate data for reporting, and integrate more effectively with other systems. 

A unified platform streamlines route planning, order management, carrier selection, freight payment, and more, allowing users to cut labor costs, reduce shipping fees, avoid accessorial charges, and more. Want to enter a new era of transportation management? Schedule a demo with 3G, today. 

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The ROI Potential of High-Quality Transportation Suites

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The logistics landscape is rapidly changing amid growing supply chain complexity, evolving customer demands, and global inflation. Shippers are caught in the middle of this upheaval, required to adapt quickly while maintaining profits. In this environment, embracing digital transformation is essential for shippers to remain competitive.

Transportation suites can help shippers overcome many of these challenges but come with a higher upfront price tag than spreadsheet systems. Are they worth the investment? Here’s a look at how users have benefitted from implementation, and what advantages you can expect for your own operation.

The Pillars of High-Quality Transportation Suites

What is a transportation suite?

A transportation suite is a comprehensive software solution designed to optimize and manage various aspects of transportation and logistics operations within a business or organization and integrates multiple modules and features to provide a holistic approach to transportation management.

In general, a transportation suite enables businesses to automate processes, streamline workflows, reduce costs, improve visibility, and enhance customer service.

What do transportation suites do?

 

  • Improve Planning: Helps users optimize every shipment, including finding lower rates and consolidating loads to improve efficiency and reduce costs
  • Streamline Execution: Enables fast, reliable, and custom logistics plans while utilizing fewer resources
  • Build Stronger Connections: Facilitates deeper and more efficient collaboration with customers, carriers, vendors, and partners at-scale, and without error
  • Quote & Rate Shop: Rate shop across modes and carriers in a single place, to pick the right service level for the right price on each shipment
  • Improve Shipment Accuracy: Ensure the correct number of pieces are in a shipment or make sure the address is correct before sending to avoid delays and unnecessary fees
  • Shipment Compliance: Helps shippers meet the requirements of trading partners, customs authorities, and the U.S. Department of Transportation when shipping goods
  • Automate Manual Workflows: Streamline operational processes and enhance shipping efficiency by automating manual tasks within the suite

Reaping the Rewards of a Transportation Suite

A transportation suite will likely require a larger upfront investment than manual systems — both in terms of capital and resources for implementation — but it can quickly and dramatically pay itself off once it is in place. What’s more, by automating transportation processes, shippers can transform operations and realize significant cost savings and operational efficiencies that continuously improve profit margins over time.

The suites with the best ROI achieve results across a number of key performance areas — just look at what these companies were able to achieve:

Route Planning

Transportation suites can utilize a wide variety of variables and data points like distance, real-time traffic patterns, delivery windows, and carrier rates to quickly identify the most efficient routes for each shipment, minimizing mileage and reducing fuel costs. What’s more, the software tracks traffic and changing conditions in real time so users can make routing adjustments on the fly. Bemis Manufacturing Company leveraged 3G’s routing capabilities to consolidate and streamline their line haul planning, dramatically reducing the price points for their distribution network below both competition and the industry standard.

Easy Optimization

Transportation suites allow users to quickly and effortlessly optimize multi-stop, less-than-truckload (LTL), and other complex shipments, not only reducing fuel and labor costs, but also increasing shipping volume and generating more revenue. These efficiency gains lead to significant cost savings while helping shippers quickly scale operations without utilizing additional resources. In one case, after implementing TMS, Green Circle Growers was able to generate over $600,000 in savings by better optimizing their multi-stop full truckloads.

Cost Effectiveness

In addition to utilizing map data to optimize routes, a transportation suite integrates directly with carriers for real-time rate visibility, allowing users to make more cost-effective carrier selections. Since transportation suites can track and organize so much on-the-ground data about each shipment, it’s easy for users to assess the performance of different carriers and how each vendor compares in terms of speed and value. Koch Foods was able to reduce freight spending by a double-digit percentage thanks to deeper carrier visibility provided by TMS.

Maximize ROI With 3G

It’s important to choose a solution with a proven track record of helping users achieve results.

3G offers a full suite of solutions including shipping management platforms, a best-in-class carrier network, and robust ERP integrations, all designed to streamline transportation operations and maximize ROI. Since its inception, 3G has become a top choice for shippers seeking to streamline and scale their operations. Read other customer success stories to learn more about what our platform can do for you.

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April 4, 2024

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Life wouldn’t be the same without parcel shipping. And while many may shake their head at such a seemingly exaggerated claim, the numbers don’t lie — UPS delivers 27 million packages per day, FedEx ships 10 million every day, and USPS sends out 4,900 pieces of mail per second. It’s the veritable spinal column of society.

Modern commerce wholeheartedly relies on the ever-present but often overlooked shipping powers provided by big-name carriers across the United States and beyond. Yet, the inner workings of parcel shipping processes, best practices, and future trends are shrouded in mystery, making it difficult for businesses to live up to constantly evolving customer demands.

Participants improve their chances of remaining competitive as time ticks on by unearthing the complexities and demystifying the sector.

What Is Parcel Shipping? 

Parcel shipping is the backbone of everyday commerce. It’s a cost-effective, convenient, and utterly flexible method of transporting items from one business to another company or from an organization to its customers.

Broadly speaking, parcel shipping is split into domestic and international categories. The former transports goods within the country, while the latter extends beyond national borders.

Naturally, it is only a suitable method for some shipments. Parcels must meet these specifications to be eligible:

  • Weight – Most carriers accept parcels that weigh up to 150 lbs. Items exceeding this weight generally fall into other shipping categories, like less-than-truckload (LTL shipping) or full truckload (FTL shipping).
  • Size – Carriers’ policies indicate that parcels are packages whose girth plus length doesn’t exceed 165 inches.
  • Packaging – Parcels are individually packaged in envelopes or boxes with the sender’s and recipient’s addresses/barcodes on the front.

Major Parcel Shipping Players

While at first glance, the parcel shipping provider industry seems to be incredibly saturated, each major player brings something different to the table, as shown below:

  • United Parcel Service (UPS) – With a maximum weight limit of 150 lbs. and length of 108 inches, UPS is one of the primary services in the country. It’s adored by those looking to ship heavier, larger packages. When shipping high-value items, the carrier provides insurance coverage up to $50,000 for lost/damaged parcels.
  • FedEx – Boasting operations in over 220 countries/territories, FedEx is one of the world’s largest parcel shipping providers. Its Ground and Home Delivery services have a 150lb weight limit. The company offers limited insurance, with affordable pricing for light and small packages. Its seven-day operation and express delivery make it a primary option among retail and commercial shippers.
  • United States Postal Service (USPS) – Great for small-volume shippers requiring affordable pricing, USPS is commonly used by eCommerce retailers and small businesses sending orders domestically. The mail piece weight limit is 70 lbs., but its features (e.g., no residential or fuel surcharges) make it an attractive industry participant for businesses serving customers nationwide.
  • DHL Express – As the largest logistics company in the world, DHL Express has a glorious track record in both the small parcel and freight shipping sectors. Customers can ship domestic and international orders with its services, paying based on the package’s weight and destination.

Small Parcel Shipping

The term “small parcel shipping” refers to sending one small package through a shipping carrier. The aptly named process deals with handheld parcels or packages that weigh less than 70 lbs. and aren’t palletized.

With this type of shipping, goods are packed into a box, poly mailer, or envelope, strapped with a shipping label, and handed off to the chosen carrier. Then, the carrier transports the package through its networks and sorts out last-mile delivery.

It isn’t suitable for every every shipment or business need. However, the following product/shipment types benefit from small parcel shipping:

  • Items that can cope with a lot of movement
  • Direct-to-consumer shipping
  • Small, low-value goods

Common Carriers

USPS, UPS, and FedEx are the top carriers in the US offering domestic small parcel shipments. One isn’t necessarily better than the other, but they each specialize in different areas of the freight industry, as shown in the table below:

  USPS UPS FedEx
Pricing From $4.00 From $7.00 From $16.00
Shipping Options Overnight delivery Ground service Priority Mail Overnight delivery 2-day delivery Overnight delivery 2-day delivery Ground service
Features Full tracking Limited insurance for Priority Mail Flat-rate shipping Cheapest for shipments under 1lb Full tracking Every service comes with carrier liability Fastest ground service Full tracking Provides business and niche shipments, such as frozen food
chart of common carriers in the United States

But they aren’t the only service providers. 

Regional small parcel carriers offer competitive rates and quicker delivery times for businesses with customers primarily from one area. By utilizing the following top service providers in their respective regions, businesses can cater to specific target markets more efficiently:

Regional Carrier Delivers To
Lasership Connecticut, New York, New Jersey, Ohio, Florida, Virginia, Maryland, Pennsylvania, Georgia, Massachusetts, Michigan, North Carolina, Tennessee, Kentucky, and Indiana
Spee-Dee Delivery Service Iowa, Illinois, Minnesota, Missouri, North Dakota, Nebraska, South Dakota, Wisconsin, and Michigan
CDL Last Mile Solutions New York, New Jersey, Connecticut, Pennsylvania, Delaware, Washington DC, Maryland, and Virginia
OnTrac Shipping Arizona, California, Colorado, Idaho, Nevada, Oregon, Utah, and Washington
US Cargo Ohio, Pennsylvania, West Virginia, Southeast Michigan, Kentucky, and Indiana
United Delivery Services Illinois, Indiana, and Wisconsin
Lone Star Overnight (LSO) Texas, Louisiana, Kansas, Arkansas, and Missouri
Courier Express Alabama, Florida, Georgia, North Carolina, South Carolina, Tennessee, and Virginia
chart of regional carriers in the United States

Pros and Cons

Small parcel shipping is a more than one-size-fits-all solution. Businesses must consider the following pros and cons before choosing the freight type:

The Pros The Cons
Easier to track with the right software Cheaper than freight shipping Various checkpoints provide increased visibility High volume delivery Economical for smaller shipments Several service levels offer maximum flexibility Convenient Ability to negotiate shipping rates Same-day small parcel shipments are less complex than freight shipments Higher risk of damages, delays, and missing packages Some carriers charge additional fees for rural shipments, address changes, and weekend deliveries Can become costly if packages exceed the dimensional or weight requirements
pros and cons of small parcel shipping

The Parcel Shipping Process

While each company has a distinct way of overseeing, performing, and managing operations, the general parcel shipping process remains unchanged.

The three overarching stages are as follows:

#1 Order Fulfillment and Packaging

Order fulfillment begins as soon as a customer’s order is received. Typically, companies use order management software to begin processing automatically. 

Once initiated, the picking team/automated warehouse robots choose the items from the warehouse. The packing slip contains all the information needed to select the correct goods, including the SKUs, product colors, number of units, sizes, and warehouse location.

With the items selected, the packing team/automated fulfillment robots decide on packing materials. Their main goal? To achieve the lowest practical dimension weight while protecting the shipped goods. Not only does this accelerate transport, but it can also lower shipping costs.

#2 Labeling and Documentation

As soon as the packaging is complete, it’s labeled appropriately, ensuring vital information (i.e., the recipient’s address) is prominently displayed. “Handle with Care” and “Fragile Item” stickers may be applied depending on the parcel type. 

But contrary to widespread belief, this isn’t where the paperwork ends.

Following labeling, professionals must prepare the necessary documents (e.g., custom declarations, invoices, bills of lading, etc.) to avoid legal battles and problems at border control.

#3 Carrier Selection and Shipping Options

At this stage, teams select the most feasible shipping method based on the parcel’s destination, delivery time slot, size, and weight. The broad options businesses can pick include ground, express, and international shipping methods. Most software allows a business to compare prices for shipping methods from major carriers based on residential addresses and other factors.

They must select and pay a carrier upon deciding on the shipping option. As mentioned earlier, the primary players include USPS, UPS, and FedEx.

After that, the package is delivered to the chosen carrier. It’s scanned upon entering the facility and into the carrier’s system for visibility and tracking purposes. 

From there, the parcel ventures to its recipient.

Challenges in Parcel Shipping

The parcel shipping industry is no stranger to challenges. As the calendar hits 2024, these are the most pressing difficulties plaguing the sector:

Cost Management

The parcel shipping market is battling increasing complexities, such as rising fuel costs, high inflation, declining volumes, and labor shortages. With each difficulty, cost management is becoming much harder to fathom. 

Companies must implement strategies that control expenses without limiting efficiency to better handle the complicated issues impacting business spending. The most effective include:

  • optimizing packaging,
  • streamlining shipping with automation and
  • improving dimensional weights.

Shipping Timeframes

2022 saw major freight shipping delays due to the aftermath of countrywide lockdowns and international restrictions. By May, almost one-fifth of the container ship fleet around the world was stuck in congestion, according to a study by the Royal Bank of Canada. At its worst, the timeframe of shipping something from China to the US was 74 days longer than normal.

However, things began returning to normal in 2023. One report said only 21% of customers are experiencing increased package delays, and the same percentage of merchants remain impacted by shipping operations. 

As of January 2024, the shipping industry has somewhat settled. But that doesn’t mean the timeframe challenge is over. Smaller packages can produce their own headaches for companies looking to earn a customer’s loyalty.

Consumers expect lightning-fast parcel shipping — an increasingly difficult (yet more important) aspect for companies to achieve. People are more likely to choose businesses with faster delivery times, so those who can’t keep pace with the sector will lose their place in the market.

Addressing Damages and Returns

Damages present headaches for delivery companies. They lead to complaints, cause returns, ruin reputations, and cost money. However, mishaps during transportation are bound to happen at one point or another. As such, businesses can only partially avoid this frustrating parcel shipping challenge. Instead, they need to focus on managing it. 

Driver carelessness is one of the main reasons for damages. Therefore, companies must put specific procedures in place to handle and transport fragile items properly. 

Best Practices for Efficient Parcel Shipping

Operating under the best practices outlined below will help businesses stay ahead of their competition.

Packaging Strategies

Businesses can save money and boost efficiency by following simple packaging strategies. These are the most popular:

  • Choose the right-sized packaging to minimize costs. Eliminating unnecessary space and optimizing parcel dimensions prevent higher charges due to dimensions and decrease the risk of damage during transit.
  • Remove excessive packing materials, like bubble wrap or filler, to reduce spend without compromising protection.
  • Use flat-rate boxes for heavy or dense items. It’s a great way to save on shipping costs for certain parcels, but careful analysis is needed to maximize savings.

Rate Negotiation with Carriers

Attempting to negotiate carrier rates without an effective strategy isn’t the best course of action. Businesses must devise a plan that gives as much as it takes. The following tried and true strategies are particularly effective:

  • Commit to long-term contracts — Establishing and nurturing relationships with carriers can make or break negotiations. Provided said relationship is built on trust, consistency, and reliability, carriers are more likely to offer favorable terms and rates.
  • Leverage bundled services — Service bundles can offer opportunities to reduce costs for both sides of the negotiation.
  • Off-peak discounts — This is a common negotiation tactic in the logistics industry. Off-peak discounts incentivize shippers to move freight during quiet times, lowering business rates. 

Real-Time Tracking and Visibility

Implementing real-time tracking technology has quickly become a best parcel shipping practice due to heightened customer demands for complete transparency. For this to occur, however, data quality must be attained. 

In this context, “quality” means it works for its intended use and is validated, timely, complete, and accurate. Providers with top-class data can trust their reports, KPIs, and analytics for faster opportunity uncovering, carrier performance comparing, and contract negotiating.

Innovations in Parcel Shipping

Innovations move quickly, but remaining abreast of technology, automation, and sustainability is the only way to stay ahead. As of early 2024, the following advancements have taken the sector by storm:

Technology Integration

The industry is seeing several technological integrations transforming how providers operate. Some of the most exciting are as follows:

  • Predictive messaging that provides a one-hour window for courier deliveries
  • Live tracking for parcels 
  • Using e-bikes and e-scooters for last-mile deliveries
  • Advanced algorithms and analytics for better decision-making

Sustainability Initiatives

An OIG survey discovered that 56% of Americans are worried about the environmental impacts of deliveries, with 41% stating that environmental practices play a pivotal role when choosing a delivery company. As such, providers are implementing various strategies to increase the sustainability of their operations, such as:

  • Reusable packaging
  • Carbon compensation or other carbon offset program
  • Optimized delivery routes
  • Fuller delivery vehicles

Automation and Robotics

Both automation and robotics have made a massive impact on parcel delivery by streamlining deliveries and boosting the efficiency of integral processes like sorting, transporting, and delivering.

Robots and their integrated automation algorithms have exceeded expectations in the categorization and organization game. Modern systems make rapidly processing large parcel volumes possible while maintaining exceptional levels of accuracy. This innovation has greatly reduced the likelihood of lost freight shipments and human error delays.

The innovations above are changing how professionals conduct parcel shipping, but these anticipated trends may have an even bigger impact.

Evolving Expectations

Aptly dubbed “the Amazon effect,” immediate gratification has become the norm among consumers and businesses. The retail giant has disrupted what people expect from online experiences thanks to features like “One-Click Ordering” and “Same-Day Delivery.” And people are only set to expect faster, cheaper shipping options as digitization progresses.

Parcel shippers must find ways to meet these ever-evolving expectations to remain profitable as this trend develops. 

Technological Advancements

Artificial intelligence (AI), robotics, and self-driving are already shaping how parcel shipping works now. However, they are set to become even more advanced, paving the way toward entirely autonomous fleets, with UAVs (otherwise known as drones) leading the charge.

Predictive analytics and route optimization will likely become more effective, accurately analyzing weather conditions and real-time traffic information for unmatched efficiency in parcel transportation.

Sustainable Practices

The above-mentioned route optimization advancements will add environmental value to last-mile parcel deliveries, with propulsion technology likely swooping in to hike the sustainability of transportation. 

Industry experts note the coming increase of cargo bicycles for inner cities. However, they quickly mention that said vehicles have limited load volumes and rely heavily on dense regional networks of micro-hubs. As such, most companies are expected to turn toward sustainable fuels and power their fleets with green electricity. 

Beyond that, collaborative delivery networks are a future development. Involving cooperation between several companies to optimize resource usage and routes, such agreements can reduce emissions, improve overall urban sustainability, and decrease traffic congestion in built-up areas.

Parcel Shipping Bottom Line

Parcel shipping is cost-effective, flexible, and convenient for consumers and businesses alike. Without it, society as we know it would cease to exist. However, since the industry is essential in modern commerce, sector participants must adapt to emerging trends to keep pace and exceed ever-growing expectations.

Over the years, industries like e-commerce have steadily gained their place globally. The internet and technological advancements made it possible to buy and sell goods online, catering to approximately 5.3 billion internet users worldwide and counting. Behind the convenience of ordering goods online is warehousing, which helps facilitate the manufacture, import, export, and transfer of goods to your part of the world.

Business owners or logistics managers who sell physical goods aim to ensure the supply chain process runs smoothly. One solution is effective warehouse management and using 3PL (third-party logistics) with a 3PL warehouse management system.

While this strategy is good for business owners, third-party logistics companies face challenges. Warehouse capacity, workforce, employee safety, shipping cost, and technology are the top concerns of 3PL providers. Third-party logistics operations must continue evolving within all supply chain management aspects to stay competitive.

The Role of 3PL Warehouse Software

There are two main reasons why third-party logistics providers use third-party logistics software in their warehouses. The first is to ensure the efficiency of their services through digitalization, and the second is to improve their customer service by catering to the demands of their customers quickly and accurately.

During the pandemic, we saw the e-commerce industry boom, and with it came enormous demands from consumers. This boom also pushed 3PL providers to improve their processes to minimize the risk of error and ensure that products are delivered accurately when and where they need them.

Here are some key features and functionalities if you want to upgrade your system or know more about 3PL warehouse software.

Key Features and Functionality

Streamlining incoming process

  • Advance shipment notification (ASN) creation
  • Goods receipt
  • Automatic or manual bin assignment
  • Putaway using a mobile application
  • Temperature zones assignment
  • Catchweight-ready

Optimized order fulfillment

  • Create delivery
  • User-controlled wave picking
  • Route-based picking
  • Configurable stock allocation (FEFO, LIFO, etc.)
  • Picking using a mobile app
  • Shelf-life-driven order fulfillment

Better user control in dispatch management

  • Group deliveries into pickups
  • Order verification before dispatch
  • Loading goods and items
  • User-controlled loading bay management

Manage inventory

  • Create scope of physical inventory
  • System-generated counts
  • Perform counting using a mobile app
  • Review and reconcile inventory differences
  • Cycle and blind counting ready

Smart packing and shipping processes

  • Implement multi-level and qualified packing
  • Create smart consignments and consolidate delivery notes into one consignment
  • Print shipping notifications and documents
  • Connect with 250+ carriers out of the box
  • Print shipping labels and generate EDI messages and loading lists

Addressing common warehouse management challenges

Warehouse space or capacity

According to statistics, 80% of respondents from 3PL providers said that capacity is at the top of the list for warehouse management challenges. This is only natural because warehouses and distribution centers are only built based on the business’s needs during construction. Two more reasons for this are the rapid growth of the industry and the price hikes in real estate, which make it hard for warehouses and distribution centers to expand quickly.

To maximize the space of warehouses, 3PLs are starting to consider expanding vertically instead of horizontally. Using customized storage solutions like industrial shelving or pallet racks, warehouses can easily store added items without expanding. It is also helpful to know the layout of the warehouse and use materials that fit the space to improve the 3PL capacity and efficiency.

Lack of skilled labor and labor cost

Next to warehouse capacity, finding, retaining, and training qualified labor is the next big challenge when it comes to warehouse management. This is the effect of the sudden growth in logistics. Companies are expanding, so adding more personnel across job posts is necessary.

The issue then starts when companies need help finding qualified and capable employees to train and stay with them. In turn, businesses need to hire more workers, resulting in higher labor costs, slower business growth, and substandard services that can ruin the company’s reputation. 

To solve this, businesses need to find a way to increase the productivity of their staff by improving how the warehouse is organized. It is tied up with maximizing storage space, and by doing this, businesses can reduce the time needed to search for a product. Automation can also help speed up looking for items when the warehouse is understaffed.

Employee safety

Warehouses can be a risky work environment. Accidents can sometimes happen, and they can injure personnel and damage goods. The issue here is not just about safety but also the consequences that stem from it. The company can lose money paying for medical bills, paying for and replacing damaged products, and dealing with the disrupted warehouse operations.

Reducing accidents and ensuring the safety of the employees means conducting safety training, providing constant reminders of the protocols, and providing personal protective equipment (PPE) for the staff. Aside from the human aspect, regular equipment maintenance should be conducted. An added precaution is to have regular safety audits to identify potential hazards.

Fluctuating demands

Dealing with the fluctuating demands of the market is one of the biggest challenges that warehouse managers face. Consistent orders keep the business running, but even though the boom of the e-commerce industry has helped bring in revenue, 3PL providers have to deal with seasonal demands.

Seasonal demands mean that some products have a higher demand depending on the time of year. 3PL providers are responsible for anticipating when a particular product will have outpouring demand. This foresight is essential because it allows them to get enough inventory when needed or know where to store them when the time comes.

One of the best ways to prepare for this challenge is to conduct market demand research and follow trends, especially for in-demand products. You should also contact your clients to discuss updates and exchange notes about current demands.

Technology

Through the years, technology has become a leading player in improving people’s and businesses’ lives. Faster production, efficiency, and data accuracy are the only ways technology has been helpful in logistics, manufacturing, and e-commerce.

More and more people develop new and more advanced technology, and the need to adapt to better systems cannot be ignored. This also applies to 3PL warehouse management. It is a costly investment, but with the right software, you can easily apply customizations and reap the benefits of updating your system to address the company’s needs.

Choosing the best 3PL warehouse software for the business is a matter of choice. A thorough understanding of their processes is required so that all of the features and functionalities of the software can be effectively implemented. Failing to choose a system that would fit the requirements and needs of the company would only result in wasted technology and high costs.

Benefits of 3PL Warehouse Software

The seamless operation of a warehouse seems easy, but there are many moving parts. It is a complicated business, mainly dealing with large volumes and thousands of products. 3PL warehouse software is a fulfillment solution that replaces outdated and manual tools that may not work. 

Businesses across all industries have realized the benefits of using 3PL warehouse software in warehouse management, supply chain logistics, and business growth.

Scaling and growing business operations

In all businesses, time equates to money. Any downtime in your system is a missed opportunity for the business. The right 3PL warehouse software makes it easy for you to implement and update when you need to. E-commerce, or online shopping alone, is slated to reach about $8.1 trillion by 2026; it is better to anticipate this growth and be prepared to expand your operations in the future.

Cloud-based 3PL warehouse software programs allow you to update and customize your system with just a click, even without knowing how to code. Labor efficiency can also be increased by 40%, speeding up operations.

This convenience will give you more time to focus on time-sensitive tasks and other concerns that need attention.

Improved Inventory Management

Streamlining and simplifying your process is one of the aims of 3PL warehouse software. It also gives you the ability to access updated stock-related data and share it with people who are authorized to see it. Connecting the software with your shipping provider gives instant and real-time data like order status and stock levels.

Added features like producing advance shipping notifications for pick or pack demand, securing login details for your clients, and removing additional labor for creating and consolidating reports can also be possible when your 3PL warehouse software is paired with enterprise resource planning (ERP).

As a 3PL provider, imagine giving your customers a great experience with every transaction. Real-time delivery reports and updates for customers add to a positive customer experience.

Cost Reduction

There’s a reason why it’s essential to do things right the first time, all the time, especially in businesses. Any mistake is tied up with the cost, whether as simple as missing a delivery or an over or underweight in inventory.

75% of shippers reported that using 3PL services has contributed to overall logistics cost reductions. With businesses starting to trust 3PL providers more and more, they should be able to deliver reliable services to be competitive. 

A 3PL management software can help maximize and optimize the use of storage space through warehouse space calculations. Automating the warehouse workflow accomplishes tasks faster with minimal human intervention, which means accuracy and efficiency even with only a few personnel.

Selecting the Right 3PL Warehouse Software

Being clear on the benefits and what a 3PL warehouse software can bring to your business brings us to the question of “How to choose the right 3PL warehouse software?”

Factors to consider in software evaluation

There are multiple 3PL management software you can choose from, but what’s important is to pick the one that suits your needs the most. Below are nine key factors that you should consider asking for when looking for 3PL software.

  1. Easy Onboarding Process
  2. Integration
  3. Functions for scalability
  4. Advanced billing and report generation
  5. Login portal for clients
  6. Configuration or customizability
  7. Multi-client management
  8. Specialized inventory control functionality and tracking
  9. Customer support

To make your decision-making more manageable, here’s a checklist from Veracore where you can conduct a primary assessment of your needs based on the nine critical factors mentioned above.

Adapting to future trends is good, but knowing the technology your competitors are adapting to can give you an idea of whether you need to keep up with these trends or wait it out. This lets you look at your business and see where it stands versus other 3PL providers.

Integration with emerging technologies

You can integrate different technologies with your 3PL warehouse management software. These technologies can give you an edge in the evolving 3PL warehouse management landscape.

Augmented Reality (AR)

AR can be advantageous for your personnel when looking for the best routes around the warehouse and accessing real-time information about inventory status.

Virtual Reality (VR)

VR can be used for employee training and the onboarding process. The business can add a module where the staff can practice their skills in a virtual environment, which will help speed up the learning curve.

Delivery Drones

Drones are not limited to surveillance anymore; they can also be utilized in deliveries. Drones can provide faster delivery, particularly to traffic-congested or hard-to-reach areas.

As mentioned earlier, adapting to these emerging technologies is based on whether there is a need for the business to integrate them.

Final Thoughts

The use of 3PL WMS eases warehouse management pain points. The issues this software addresses give you a better opportunity to fine-tune your system and focus on tasks like planning and forecasting so you can be prepared for the coming months or years.

Third-party logistics services are becoming more competitive and in demand. An upgrade of your 3PL warehouse software might be a good idea if the business is growing rapidly, as it could only mean better service for your customers and higher revenue.

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The Real Cost of a Single-carrier Strategy

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In the fast-paced world of logistics, every penny spent on supply chain management counts – and nowhere is this more evident than in the decision to commit to an exclusive carrier strategy. Shippers, manufacturers, distributors, and retailers often believe that a single-carrier setup provides stability and predictability, but the reality is far more complex. By embracing this short-sighted approach, businesses restrict their choices and expose themselves to a premium that could reach as high as 30% of their shipping expenses. 

In this in-depth exploration, we’ll uncover the hidden costs of exclusivity in carrier partnerships and illustrate why diversifying your carrier base is crucial for not just cost-efficiency, but also customer satisfaction and supply chain resilience. 

The Downside of a Single-Carrier Approach 

For many businesses, sticking with one carrier might seem like a simple, hassle-free option. After all, it involves less administrative work, and it could potentially lead to stronger relationships with the chosen carrier. However, this strategy is not without its drawbacks. 

Limited Selection, Reduced Leverage 

By sourcing all shipping from a single carrier, companies inadvertently give up the power that comes with choice. Access to a variety of carriers means more negotiating power and the ability to leverage different service offerings and competitive rates. It’s akin to grocery shopping at only one store when you’re not tied to a single supplier, you have the freedom to shop around for the best value. 

Surcharge Sticker Shock 

National carriers typically impose surcharges during peak seasons or for specialized services, and these surcharges can quickly add up. However, these additional costs are not universal; for instance, some regional carriers may not pass these expenses on to their clients, providing a cost-effective and transparent shipping solution more in line with peak demand times. 

Flexibility on the Line 

A single-carrier strategy severely curtails shipping flexibility. With only one carrier, businesses are often limited in their ability to ship from all origin points, choose optimal delivery times, or switch to alternate routes when necessary. In an environment where customer expectations are continually evolving, this lack of flexibility can place a strain on service levels and brand reputation.  

Scope of Service Limitations  

Certain customers may expressly require delivery through specific carriers due to their existing infrastructure or service agreements. This constraint can lead to missed opportunities and potential conflicts with clients, underscoring the importance of maintaining diverse carrier partnerships to meet varying customer needs. 

Why You Should Diversify Your Carrier Base 

The advantages of a multi-carrier approach are not just theoretical – they translate into tangible benefits that have a direct impact on the bottom line.  

Weathering Supply Chain Disruptions 

In supply chain, disruptions are not a matter of ‘if’ but ‘when.’ When you rely on a single-carrier your vulnerability is heightened to logistical disruptions. Should the chosen carrier face operational challenges, such as strikes, weather-related delays, or systemic failures, the entire supply chain can be put at risk. Diversifying carriers can mitigate these risks, ensuring that any single point of failure doesn’t bring operations to a halt. A diversified approach mitigates the risk of these disruptions, allowing for quick pivots and ensuring the smooth continuity of operations, even in the face of unexpected events.  

Lowering the Cost of Transportation 

One of the most significant drivers of change in carrier selection is cost. By utilizing multiple carriers, businesses can select the most cost-effective option for each shipment, ultimately reducing their overall transportation spend.  

Meeting Evolving Customer Expectations 

Customers today expect a variety of shipping options, from the speed of delivery to the supplier. A multi-carrier approach provides the agility needed to meet these diverse demands and ensures that businesses do not fall behind in the race for customer satisfaction. 

The Path to Smarter Carrier Selection 

Choosing and managing multiple carriers may seem daunting, but with the right strategies and tools, the process can be streamlined and simplified.  

Utilizing Modern Multi-Carrier Shipping Software  

Multi-carrier shipping software can save time and money by automating the carrier selection process. These solutions, driven by intelligent planning and analysis, ensure that the best carrier is selected for each shipment, based on factors such as cost, service level, and historical data. 

Negotiating Smart Carrier Agreements  

When you diversify your carrier network, negotiating smart agreements becomes more critical. Focus on consolidating your overall freight spend instead of carrier-specific volume commitments to secure more favorable terms. 

Incorporate a 3PL into your carrier network  

Incorporating a third-party logistics provider (3PL) into your carrier network expands your carrier options and lowers costs. Shippers that partner with the right 3PL to leverage their pricing power to significantly reduce freight costs and their established carrier relationships to offer new customer services. 

Success with Multi-Carrier Strategies 

Case Study: ursource leverages 3G’s Carrier Network to optimize shipping and save $200,000 per year 

The ursource team embraced the multi-carrier strategy and implemented 3G to meet the needs of their growing business and customer expectations, which resulted in the following: 

  • Reduced shipping costs by $200,000 per year 
  • Use of regional parcel for a better choice of services and rates 
  • Combined LTL/freight with parcel zone skipping to optimize end-to-end shipping costs 

Read the ursource story here to learn more. 

Conclusion: The Multi-Carrier Advantage 

The multi-carrier approach is not just a band-aid for the wounds caused by an overreliance on a single carrier; it’s a strategic move towards building a more adaptive, cost-efficient, and customer-centric operation.  

In the complex ecosystem of supply chain management, the ability to pivot and adapt quickly can be the difference between profit and loss. It’s time for shippers, manufacturers, distributors, and retailers to reassess their carrier strategy and unlock a world of cost savings and operational agility. By transitioning to a multi-carrier approach, businesses not only lower costs but also position themselves as leaders in a market that values versatility and resilience.  

For those who are committed to crafting a supply chain that stands out for its efficiency and customer-centricity, the path is clear – and it’s paved with the benefits of a multi-carrier approach. 

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March 20, 2024

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The Ship Shape Strategy: Trimming the Fat Off Your Shipping Costs

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Shipping expenses can silently erode your profit margins. Particularly for businesses with an online footprint, navigating the complex logistics landscape and enduring carrier rate hikes requires shippers to stay vigilant. This intricate web of challenges often leaves shippers yearning for a roadmap to escape the expense-laden wilderness. 

If you’re in the business of moving products from point A to point B, you know that the key to winning the shipping cost game is efficiency. It’s not about slashing and burning, but about precision cuts that sculpt a lean, mean shipping machine.  

The Weight of Shipping Costs  

Understanding where your shipping costs originate is the first step in shedding unnecessary expenses. It’s a multifaceted challenge with many potential areas for savings, from identifying the most cost-effective carriers to perfecting the packaging that protects your goods. 

Major cost centers you need to consider: 

  1. Carrier Rates, Surcharges, and Surprise Fees: The base rates set by the carriers are often compounded by various surcharges like fuel & residential delivery, and address correction fees. 
  2. Packaging Materials: The simple equation of ‘bigger box, bigger cost’ underpins the impact of packaging materials on shipping expenses.  
  3. Labor: The need for additional workforce to handle rush orders, or inefficient warehouse practices, can significantly add to costs.  
  4. Return Shipping: A silent, sometimes monstrous, cost that creeps in post-sale and is often overlooked by shippers.  
  5. Software & Administrative: The tools and manpower to support the shipping process also bear financial weight.  

Shaving Dollars Off Your Shipments 

With the cost centers identified, it’s time to reveal what can be done that can lead to substantial savings. This section covers the optimal methods for slicing those shipping expenses. 

Efficient Shipping Tactics 

The path to efficient shipping is paved with strategic decisions and disciplined execution.  

  1. Right-Sizing Packaging: Utilize boxes that match the volume of the items being shipped, minimizing dimensional weight charges. 
  2. Carrier Diversification and Hybrid Services: Shop around and consider leveraging multiple carriers to get the best rate for each type of shipment. Combining the strengths of various carriers with local drop-shipping for last-mile delivery can reduce costs and improve delivery times. 
  3. Address Accuracy: Implement systems to ensure correct addresses on the first attempt to avoid address correction fees.  
  4. Batch Processing: Streamline the shipping process through batch orders and bulk shipping, reducing the time employees spend on individual orders.  
  5. Order Accuracy: Efficient shipping extends beyond timely delivery; it encompasses order accuracy and fulfillment precision which ensures that orders are picked, packed, and shipped accurately, minimizing errors and customer dissatisfaction. 

The Tale of Two Boxes 

Packaging is not just a protective measure; it’s an opportunity. Here are 4 ways that clever packaging choices can represent immediate shipping savings.  

  1. Eco-Friendly Materials: Not only can they lower costs, but environmentally conscious packaging options can also be a selling point.
  2. Custom Packaging: Fits more in less, reducing the need for excess filler material and lowering dimensional weight.  
  3. Utilize Poly Mailers: For non-fragile items, these lightweight mailers can mean significant savings on weight-based shipping rates.  
  4. Package Inserts: Marketing materials or thank-you notes can serve double-duty, reducing the need for separate mailings.  

Charting a Course with Technology 

The digital era has not only transformed commerce but also introduced a variety of methods to make the shipping process more efficient and cost-effective. In this section, we explore the tech solutions available to fortify a cost-conscious shipping strategy. 

Shipping and Transportation Software Solutions  

Modern shipping software has the capability to resonate well beyond purchasing discounts.  

  1. Real-Time Rate Shopping: Ensures that you’re always getting the best price for the shipping method you choose. 
  2. Integration with Marketplaces: Seamlessly sync orders from marketplaces with shipping systems, reducing manual data entry.  
  3. Multi-Carrier Support: The capacity to handle various carriers within one system can add a layer of insurance against service disruptions.
  4. Batch Label Printing: Drastically cuts processing time by printing labels for multiple orders at once.  
  5. Automated Returns: Providing customers with an easy-to-use return process can streamline and reduce the costs associated with return shipping. 

Conclusion  

Reducing shipping expenses is not just a matter of money; it’s about gaining a competitive advantage in a saturated market with ever-changing customer demands. Understanding how shipping costs affect financial performance and taking proactive steps to minimize them can boost profits and customer happiness. By leveraging innovative technologies and enhancing packaging strategies, companies can reap significant rewards beyond simple cost reductions. 

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March 20, 2024

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