An increasingly complex supply chain and the need for greater flexibility in freight movement is spurring transportation management system (TMS) adoption globally, according to research from technology market advisory firm ABI Research.
The research suggests that global TMS revenues will nearly double to $31 billion by 2025, as organizations seek greater visibility, efficiency, reliability, and flexibility of freight movement across modes, cargo types, and geographies. Capacity constraints and rising transportation costs are also driving investment in more advanced technology solutions, the researchers said.
“There is growing usage of open APIs and Software Development Kits (SDKs) to create customized solutions for different sized companies, verticals, and geographies as well as partners and co-opetition,” Susan Beardslee, principal analyst in ABI’s Freight Transportation & Logistics group, said in a statement. “Adoption triggers include capacity constraints, which are growing ever tighter (including driver shortages back to 2018 levels) and pushing up costs toward the double-digits.”
The Covid-19 pandemic is accelerating these issues, which are calling into question the effectiveness of traditional solutions, according to the research.
“Supply chain leaders across all verticals need to adopt a more advanced and inclusive approach to forecasting and adapting to a continually changing environment,” the researchers wrote. “A growing list of cloud-based software vendors is offering Artificial Intelligence (AI) and advanced analytics capabilities. These solutions can reliably interpret data from many complex indicators and execute more insightful and connected strategies.”