Choosing an ERP system for logistics and freight forwarding companies

The complex nature of the shipping and logistics industry combined with the fierce competition that exists in this sector presents unique challenges for small and medium-sized operators. This makes it imperative for freight forwarders, non-vessel common carriers (NVOCCs), customs brokers, international freight forwarders, shipping agents and freight forwarders to streamline their multiple business operations to remain competitive. Implementing the right ERP system dedicated to logistics and freight forwarding can help companies realign and scale their activities efficiently, while adapting to the rapidly changing regulatory environment.

While an ERP framework can go a long way in integrating various business and operational functions, it’s not easy to choose an ideal freight forwarding software that will allow you to manage, access, and share information coming from and going into various departments. Before planning and implementing an ERP system, it is important that companies analyze its potential taking into account the following factors:

Integration of all operational and accounting elements in a single platform

The most important factor to consider is the degree of integration that your ERP allows. For example, a small to medium size freight forwarder that uses different applications to manage functions including freight management, customs brokerage, documentation, container tracking, shipment tracking, and fulfillment services would benefit most. if all applications were integrated into a single master. Application based on the Tally ERP 9 platform. This customized Tally solution makes the operation more efficient, profitable and provides the owner with real-time visibility into inbound/outbound shipments and their corresponding payables/receivables.

Avoid duplication due to centralization of tasks from multiple branches

The second parameter to consider is to what extent the ERP system allows centralization of key tasks from multiple branches. Consider each branch of a multi-location shipping agency that uses a separate business accounting application. This will result in disconnected and independent data pools from each other, leading to unnecessary delays, outages, and data key changes, while the business owner needs real-time operational and business data monitoring. On the other hand, if the same agency decides to partner with a Tally service provider and implement a centralized software application, it has greater predictability of its operations. Since this scenario allows the master application to read, write, and edit data to and from each branch, it helps business owners track payment, performance, profitability, and pending shipment details.

Improved financial control and greater visibility

The ERP system you choose to implement should provide greater financial control by cross-integrating operational task data and actual transaction data. The system must allow the owner to calculate the expected profit per shipment and then compare it to the actual cost and profit of the shipment (using transaction data, accounts receivable, accounts payable, and brokerage fees). This helps the owner track the profitability of each job, which in turn can help you focus on future shipments/jobs that have a higher profitability rate.

Quick access to information, report generation and data archiving

Information reporting, data archiving, and data storage are important aspects of the logistics and shipping business. The ERP system must be able to generate and archive reports, including balance sheets, shipping related MIS reports, packing lists, purchase orders, and multiple invoices for different chain partners and quotes. In addition, cargo documents, including Cargo Arrival Notice (CAA), Cargo Arrival Notice (CAN), Delivery Order (DO), and Inland Bill of Lading (HBL) must be generated directly from the app. . This helps business owners to not only retrieve, but also send these documents directly from the system to supply chain partners.