GlossaryEN1 min readUpdated: Jun 26, 2026

Transportation Management System (TMS)

A Transportation Management System (TMS) is a software platform for planning, executing, and monitoring freight shipments across all transport modes.

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Last updated: 26 June 2026Published: 19 June 2025

Source: https://www.investopedia.com/terms/t/transportation-management-system-tms.asp

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Definition & Explanation

A Transportation Management System (TMS) is a software platform for planning, executing, and monitoring freight shipments across all transport modes. Core functions include route optimisation, carrier selection, freight invoice auditing against contracted rates, and compliance checks for customs and dangerous goods regulations. Shippers, third-party logistics providers, and freight forwarders use TMS solutions to cut transport costs, reduce empty mileage, and demonstrate measurable gains in on-time delivery. Unlike a Warehouse Management System (WMS), which governs stock movements within a facility, a TMS governs the movement of goods between locations. Most modern systems are cloud-based and connect to ERP and WMS platforms via standardised APIs.

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Recommended format: Source: Freight Academy – Transportation Management System (TMS) (https://www.freight-academy.com/en/glossary/transportation-management-system-tms-2), accessed 2026-10-28
APA style: Freight Academy Editorial Team. (2025). Transportation Management System (TMS). Freight Academy. https://www.freight-academy.com/en/glossary/transportation-management-system-tms-2
BibTeX: @misc{transportationmanagementsystem2025, title = {Transportation Management System (TMS)}, author = {{Freight Academy Editorial Team}}, year = {2025}, url = {https://www.freight-academy.com/en/glossary/transportation-management-system-tms-2}, note = {Freight Academy, accessed 2026-10-28} }

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