Transportation Management Systems Market Size, Share & Trends Analysis Report By Deployment (On-premise, Cloud), By Mode of Transportation (Roadways, Railways), By End-use, By Region, And Segment Forecasts, 2021 - 2028

Report Overview

The global transportation management systems market size was valued at USD 99.40 billion in 2020 and is expected to grow at a compound annual growth rate (CAGR) of 11.7% from 2021 to 2028. Advances in the latest technologies, such as Advanced Driver Assistance Systems (ADAS), growth of the retail & e-commerce industries, and the strengthening of bilateral trade relations between various nations are some of the key factors that are expected to drive the market growth over the forecast period. Transportation Management Systems (TMS) help businesses and organizations in some of the key operational processes and functionalities, such as accurate freight audit, payments, route planning & optimization, yard management, load building, order visibility, and carrier management, associated with procurement and freight shipment.

Furthermore, TMS also helps the incumbents of various end-use industries and industry verticals in improving the efficiency of shipments, reducing the overall costs, and providing real-time supply chain visibility while enhancing customer service. Such benefits are expected to contribute to the growth of the TMS market over the forecast period. Inefficiencies while transferring goods between the source and destination can lead to a significant increase in overall costs. At the same time, it can also add to the frustration of customers and tarnish the brand reputation. Hence, to avoid financial losses while protecting the brand reputation, incumbents of various end-use industries and industry verticals are adopting TMS. Transportation management systems are aimed at providing new forms of optimization that can potentially drive operational efficiency and enhance the ROI for end-users. The ROI derived from the implementation of TMS is primarily from the load and inventory optimization. While shippers opt for TMS for several other reasons as well, TMS has been evolving continuously and ROI is being derived across several functions. Deployment of TMS can be directly associated with noticeable freight savings stemming from process optimization, such as better procurement negotiations, efficient routing, and selection of low-cost transport modes.

Integration of the latest technologies, such as blockchain and Artificial Intelligence (AI), in TMS to enhance the capabilities of these systems has been one of the latest trends that have been gaining traction. For instance, in November 2019, Wal-Mart Canada Corp. launched a blockchain-based Supply Chain Management (SCM) solution, which includes freight tracking and payment processing for around 70 trucking companies with a distribution network of over 400 retail stores. The solution utilizes IoT sensors and GPS tracking systems installed in semi-trailer trucks along with a web portal for manual entry for both suppliers and operators.

TMS is capable of capturing and translating several data fields associated with complex shipments into the simple requirements of ERP, thereby helping end-users in saving on data re-entry while enabling efficient usage of the latest data communication standards, such as Electronic Data Interchange (EDI) and Extensible Markup Language (XML). TMS is also being developed with built-in powerful optimization engines to offer efficient reporting capabilities. In line with the changing requirements of end-users, these systems are being developed in such a way that they are highly adaptable and easy to implement. This is also estimated to drive the market growth over the forecast period.

Deployment Insights

The on-premise segment accounted for the largest market share of over 57% in 2020. Several large-scale manufacturing and distribution companies still prefer on-premise TMS because of the data safety requirements, convenient access to the server, and better control over customization. However, incumbents of various industries are widely opting for cloud-based TMS due to the rising awareness about its benefits, such as superior and efficient configuration capabilities.

Thus, the cloud segment is anticipated to exhibit the fastest growth over the forecast period. Cloud-based TMS offers unique planning and optimization benefits to shippers, vendors, and logistics providers. Moreover, it is cost-effective as compared to on-premise TMS, particularly due to the lower licensing and management costs associated with it. Another advantage of cloud-based TMS is that the information is stored on the cloud and can be accessed remotely from any geographic location in real-time.

Mode of Transportation Insights

The roadways segment accounted for the largest market share of over 41% in 2020. Road freight is one of the most common modes of transportation in the world. It is considered relatively cheaper and flexible as compared to other modes as it can facilitate loading and unloading at any destination. At the same time, various governments, especially in the emerging economies, are pursuing initiatives to improve the transportation infrastructure, which is expected to drive the demand for logistics through roadways and subsequently drive the growth of the roadways segment. The waterways segment is anticipated to register a considerable growth rate over the forecast period.

The growth can be attributable to the heavy investments being made by various governments in the deployment of TMS for efficient management of waterways. For instance, according to The World Bank Group, in March 2019, Vietnam’s Ministry of Transport proposed the Southern Waterways Logistics Corridor, which also included the establishment of a Vietnam Trade Information Portal for collecting and managing the import, export, and transit of goods in Vietnam. In addition, the project would also include the installation of navigation aids and the deployment of vessel TMS along the Cho Gao Canal to improve safety and reduce the transit time of shipments. Such initiatives are expected to drive the growth of the waterways segment.

End-use Insights

The manufacturing segment accounted for the largest market share of over 36% in 2020. The rising number of manufacturing units in emerging economies, such as India and Mexico, has increased the outsourcing of inventories and raw materials required for manufacturing activities. For instance, the Indian government’s ‘Make in India’ initiative puts a strong emphasis on the development of the domestic manufacturing industry and potentially encourages indigenous manufacturing. Such initiatives bode well for the growth of the manufacturing segment over the forecast period.

The retail & e-commerce segment is anticipated to register the fastest CAGR over the forecast period. The growth can be attributed to the rapidly expanding retail and e-commerce industries in emerging countries, such as India and China. While China accounts for nearly 80% of the online sales in the Asia Pacific; India is poised to become the world’s fastest-growing e-commerce market leveraging robust investments in the e-commerce industry. Some of the large e-commerce companies, such as Alibaba Group Holding Limited, Walmart, Inc., and Amazon.com, Inc., are maintaining and strengthening their shipping operations by deploying TMS.

Regional Insights

North America led the global market in 2020 with a revenue share of over 33% and will remain dominant throughout the forecast period. North America is known for the wide adoption of roadways as the primary mode of transportation for moving freight. Furthermore, the region is also home to some of the leading TMS vendors, such as In for Inc.;3GTMS; Cerasis Inc.; and International Business MachinesCorp., which also contributes to the growth of the regional market.

Asia Pacific is anticipated to register the fastest growth rate over the forecast period. The growing retail and e-commerce industries in India, China, and Indonesia are expected to drive the growth of the regional market over the forecast period. The initiatives being pursued and the policies being drafted by various governments in the region to create a favorable environment for the development of smart transportation are also anticipated to contribute to the growth of the Asia Pacific regional market. For instance, in February 2017, the “13th Five-Year Plan for Modern Comprehensive Transportation System” was announced by the Government of China to roll out a safe, efficient, modern, and green integrated transportation system.

Key Companies & Market Share Insights

Major companies are investing heavily in research & development activities to upgrade their existing solutions and launch new products in the highly competitive market. For instance, in November 2019, BluJay Solutions Ltd. announced the launch of the Freight Management Index (FMI), a monthly report providing transportation market intelligence for carriers, industry professionals, and shippers.

Furthermore, companies are focusing on other strategies, such as mergers & acquisitions, strategic partnerships, contracts, and agreements, to gain a competitive edge. For instance, in September 2019, In for, Inc. partnered with QAD Precision to deliver multi-carrier parcel execution capabilities within the Infor Nexus TMS solution. Some of the prominent players in the global transportation management systems market include:

• 3GTMS

• BluJay Solutions Ltd.

• Cerasis, Inc.

• C.H. Robinson Worldwide, Inc.

• The Descartes Systems Group, Inc.

• Infor, Inc.

• International Business Machines Corp.

• JDA Software Group, Inc.

• Manhattan Associates

• MercuryGate International, Inc.

• Oracle Corp.

• SAP SE

• Trimble Transportation Enterprise Solutions, Inc.

Transportation Management Systems Market Report Scope

Segments covered in the report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2028. For the purpose of this study, Grand View Research has segmented the global transportation management systems market report on the basis of deployment, mode of transportation, end-use, and region:

• Deployment Outlook (Revenue, USD Billion, 2016 - 2028)

  • On-premise

  • Cloud

• Mode of Transportation Outlook (Revenue, USD Billion, 2016 - 2028)

  • Roadways

  • Railways

  • Waterways

  • Airways

• End-use Outlook (Revenue, USD Billion, 2016 - 2028)

  • Retail & E-commerce

  • Manufacturing

  • Logistics

  • Government Organizations

  • Others

• Regional Outlook (Revenue, USD Billion, 2016 - 2028)

  • North America

    • U.S.

    • Canada

    • Mexico

  • Europe

    • U.K.

    • Germany

  • Asia Pacific

    • China

    • India

    • Japan

  • South America

    • Brazil

  • Middle East & Africa