2024 Guide to Selecting Custom Transportation Solution vs Out-Of-The-Box Software

TMS adoption rates have been strong for the last several years. The transportation management software (TMS) market is growing at a solid 14.4% CAGR. Based on their strategy, companies invest in either out-of-the-software or logistics software development, aiming to upgrade their capabilities. 

Little surprise. A finely tuned TMS plays the key role in:

Still, selection concerns remain. Should your company proceed with an out-of-the-box system or design a custom TMS?

Let’s figure out an answer below. Plus, what to look for in a transportation management system.

Out-of-the-box solutions are designed to work by default right after software or subscription purchase. Most people think this way: You buy, set up an account, and use it. 

However, this is not the case with logistics solutions. TMS software is often “buyer beware.” A purchaser must step up to the plate and learn it—often a daunting task. 

Out-of-the-box TMS solutions seek to offer the greatest functionality. The number of fields to fill out within standardized systems is usually beyond an expert’s understanding. 

Managers must review a large number of options to add specific details to the system. They mark numerous checks and settings, ensuring everything will work as it should. If they lack expertise, they might need outside help with an implementation.

Then, maybe it is enough to hire guru software engineers who will deliver a system so that it will do miracles? 

Sad to admit it, but miracles do not happen. Engineers can effectively deliver a solution for an identified challenge. They need a tight collaboration with a client company’s expert who knows what exactly requires improvement.

While all transportation companies aim to offer the same or similar options, they all run unique processes. Engineers must understand the specifics of business processes to deliver what is expected.

Therefore, companies must invest time and resources in whatever software type they choose. One size does not fit all.

The million-dollar question is what needs to be included in an implementation plan and what not.

You need to consider the cost of ownership, both direct and indirect, which you pay for the best-adjusted feature list, reliability, and minimum time for changes. Here is what both alternatives provide:

Here are the essential elements of a selection strategy:

A specific answer will work for your transportation company once your goals and needs are identified.

The exact thing is yet: when you are looking for a solution for your business, spend enough time on research. Better hire specialists for a discovery phase. It is wise to deeply investigate all pros and cons of each specific implementation. Only then, make a well-weighted decision.

Systems must improve a company’s workflow based on the rules set for business processes. It is quite possible that the selected out-of-the-box software does not provide the needed functionality for the envisaged activities.

If it doesn’t, the company either gets back to the previous workflow and does not use a new system. Or, it must initiate changes in business processes, which leads to temporary productivity drop and internal resistance.

Your company must focus on constant improvements and optimization to survive in the disrupting environment. Timely software updates allow you to introduce the envisaged workflow optimization.

Here, you need Agile app development and/or app updates to embrace the desired improvements in less time. You need to create a competitive edge over the companies that do not know how to adapt as fast as you do.

No matter whether you select an out-of-the-box solution or start custom software development, here are the most essential features to look for in a TMS in 2024:

Real-time visibility is the top requirement for all processes to turn transparent and manageable. Employees need awareness to increase productivity by doing their tasks easily, elaborately, and on time.

Transportation produces the largest portion of the total US greenhouse gas emissions. TMS helps commit to climate control by calculating the optimum routes based on produced emissions. Fuel consumption improves.

Emerging AI capabilities increase logistics companies in two ways. First, AI refines forecasting and lets it balance costs, workload, and available resources. Second, AI-powered chatbots help improve customer service without overloading the support team.

A TMS improves freight management. It decreases the time needed to find the best carrier for a specific load based on several predefined parameters (costs, freight type, immediate availability, rating, etc.).

Partnership management is streamlined because of data exchanges between supply chain participants. TMS automatically shares updates with responsible supply chain participants and sends required data to billing and payroll software.

Reports and business intelligence enable a company to catch important metrics, e.g., GPS data aggregations, and draw meaningful insights into its performance. Emerging trends and improvement areas become visible. The same data is further used to refine AI forecasts.

Smart load planning decreases the workload of a warehouse team and truck drivers. A TMS calculates an efficient load arrangement based on complex parameters, such as stops, space utilization, safety, and load stability.

Certain users need a smartphone or tablet app to fulfill their duties. For instance, drivers need to see the route and related order details. Warehouse managers need to see an item’s location inside the warehouse while away from the keyboard. And these are only two of many cases!

To meet customer expectations, a hybrid model combining centralized and decentralized approaches may be required. A cloud logistics solution helps companies be agile while balancing costs and delivery time.

IT Craft developers have extensive experience in custom software projects for the logistics industry:

All based on our clients’ growing needs.

Here are two examples of building both an out-of-the-box TMS for a startup and a custom logistics management solution for an up-and-running business:

Now a leading TMS solution, according to the G2 portal. 

MyCarrier once started small with an MVP for managing and tracking less-than-truck loads. The IT Craft team provided the required cloud logistics portal on time and on budget.

The same team helps the client grow their business. It has completed software transformation, simplifying updates and maintenance and ensuring scalability. 

The portal provides clients with a comprehensive overview of available options and a complete visibility of all shipments.

For shipment companies, the portal offers fast onboarding and tools for optimized operations.

The client envisaged a custom system to provide residents of Manhattan with top-level, on-demand laundry services. 

IT Craft engineers started cooperation with auditing available source code, which they improved and finalized. 

The team focused on further project transformation upon the client’s decision to pivot to business customers. 

The transformed software ensures complete visibility of all business processes. It helps detect any discrepancies and notify responsible managers immediately.

A complex analytics system lets the client maintain efficiency and determine improvement areas.

A finely tuned TMS is the cornerstone of a supply chain’s sustainability. Companies identify and address emerging issues immediately with its help.

Still, no solutions provide a “big red button” that a manager can push, and magic will happen. You need to carefully evaluate and implement a solution that will be effective for your specific business processes.

Here is your routine for selecting between out-of-the-box vs. custom TMS solution: