Supply Chain Expertise and Technology Blog by TMC, a division of C.H. Robinson

An Industry Formula for TMS

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It’s important to tailor transportation management systems (TMS) to individual corporate users. But the technology can also be customized to specific industries, particularly in cases such as the chemical sector where there are many special needs.

According to the American Chemistry Council, the chemical business is a $ 720 billion industry that is one of the largest sectors of the U.S. economy. More than 96% of all manufactured goods are directly touched by chemistry.

The industry puts a lot of time and effort into making sure that their products are transported safely. The Council estimates that in 2010 basic and specialty chemical companies spent $10.8 billion on environmental, health, and safety programs.

At the heart of this effort is the Responsible Care performance program for the safe, responsible, and sustainable management of chemicals. Leading companies have adopted the program, which is practiced in 60 economies worldwide. ChemSolutions™, a division of C.H. Robinson Worldwide, Inc. that provides global logistics services to the industry, is a Responsible Care practitioner, for instance.

TMS solutions – and especially advanced versions such as Managed TMS® – can play a key role in helping chemical companies to maintain high safety standards in transportation while improving network efficiency. Here are some TMS applications that are geared to the distribution of chemical products.

Green pay off. Sustainability is a critical component of Responsible Care. Measuring and reducing the carbon footprint, for example, is important for enterprises in this sector whether they be shippers, carriers, or distributors. A TMS can be used to reduce network mileage thereby cutting fuel consumption and improving the carbon footprint.

TMS solutions – and especially advanced versions such as Managed TMS® – can play a key role in helping chemical companies to maintain high safety standards in transportation while improving network efficiency.

Fewer empty miles.  Minimizing deadheads by finding backhaul opportunities for freight has become standard practice in the long haul freight business. But the practice is much less mature in the chemical business, where the complexity of hauling hazardous materials makes it more difficult to identify these opportunities. Prior content issues, for instance – where a chemical bulk carrier has to ensure that several previous cargoes it carried are compatible with a new load – tend to drastically reduce the number of available backhaul routes.

The increased supply chain visibility that comes with Managed TMS helps chemical shippers to identify more backhaul options, particularly where a company only has good visibility into their own network. Reducing the number of empty miles also improves environmental performance.

Load optimization. Again, using TMS solutions in this area is commonplace in the wider freight community, but less developed in the chemical sector. TMS optimization tools offer huge potential here. Take, for example, the shipment of large tote containers, where a chemical shipper uses a TMS to find optimal routes and avoid relatively costly less-than-truckload or partial truckload transportation services.

Better screening. A central feature of Managed TMS is also a high priority for chemical shippers: making sure that all service providers and operational personnel meet appropriate certification and track record criteria. The carrier qualification capabilities of a Managed TMS solution can introduce more rigor to the vetting process by, for example, allowing only suitably qualified individuals to view or alter the details of loads and to book shipments on the system

Streamlined responses. A Managed TMS suite can function as an information hub when incidents such as chemical spills occur. A single, comprehensive source of shipment-related data helps responders to connect quickly with other parties and to access the information they need to resolve the situation. The data is also useful in the aftermath of an incident, when there are likely to be legal actions.

Global reach. The chemical industry is global by nature, and the control tower concept, which adds worldwide transportation management capabilities to Managed TMS, is another feature that has great potential for improving the industry’s freight operations.

As Managed TMS continues to evolve, chemical shippers will find more ways to derive value from the technology. Applications like these also highlight the potential for adapting TMS solutions to the demands of specialist businesses.