2. What is SAP transportation management?
SAP TM is a solution to perform all activities connected with physical movement/transportation of goods from one
location to another location
The SAP transportation management is a product from SAP AG. The solution has been designed for transportation and logistics
requirements of all industries and it also helps to reduce transportation costs and improves in logistics planning and efficiency.
SAP TM also enables to manage all inbound/outbound and domestic/international transports and tracking and tracing of
order management.
The SAP transportation management runs on BOPF framework and UI as FPM ( Webdynpro ABAP)
3. Benefits of TM:
1. Improved on-time delivery performance through better multi modal planning and higher transparency.
2. Reduced transportation costs by determining the most effective transportation modes and routes, including the sequence of
pickups and deliveries.
3. Efficient transport utilization through optimal planning and carrier collaboration.
4. Control over the entire transport management process from quoting to execution.
5. Monitoring and settlement through higher visibility and traceability.
4. Types Of transportation Management-
1) Internal –
Internal transportation is movement within same premises or warehouse for example if the material is needed for trial
or testing, raw material movement from warehouse to production area, from production area finished goods movement
to the goods issue area.
2) External-
External transportation is supplying material to consumer or movement from one plant to another or two
distribution centres.
5. Transportation Relationships
1) Consignor- Consignor is shipper.
2) Consignee- Consignee is end consumer.
3) Freight forwarders- Freight forwarders collect the requirement from shipper and provide it to Carriers. Shippers have
Freight forwarders contract with them and they arrange the carriers and they do not possess and any transportation
equipment’s.
4) Carriers- Carriers actual transports the goods and possess transportation equipment’s and they have freight contract
with freight forwarders.
6.
7. Transportation Roles-
1) Shipper- Shipper is consigner and who arranges for goods to be shipped. Shipper can be a company produces the
goods or vendor who supplies the raw material.
2) LSP- Logistic Service Providers are executing or actual performing transport. They are third party and outsourced
entities by shippers.
8. Types of transportation-
1) Full truck load (FTL)-
FTL or Full truck load is the transport of goods that fill up the full truck or a partial load occupying 80 to 90% of the truck.
Bulk material mostly transported by this and it is contracted to one customer also it is faster but expensive.
2) Less than truck load (LTL)-
Less than truck load means transportation with smaller quantities and the material loaded will not occupy entire space of the
truck means when there is need of movement of goods in smaller batches and quantities then LTL is used.
3) Full container load (FCL)-
Full container load (FCL) is and ocean shipment and in which a cargo occupies full container of any size and used by a single
consignee when there are large amount of goods needed to transport and booked by a single shipper.
4) Less than container load (LCL)-
Less than container load (LCL) also an ocean shipment but here full capacity of container not utilized so many small
shipments combined together in Cargo means if a Shipper does not have enough product then the goods loaded along with
other shippers goods and moved together.
9. Terms to Remember
Means of transport : Vehicle used for transportation
Mode of transport : The medium for transporting, ex, Road, Sea, Air, Rail
10. Business documents in TM
Freight Unit : Set of goods that are transported together through entire transport chain.
Freight Order : The order for which a carrier or the shipper plans the transport execution for road and rail
transport
Freight booking : The order for which a carrier or the shipper plans the transport execution for ocean and air
transport
Forwarding order : An order from an ordering party to a carrier or logistics service provider with respect to the
transportation of goods from a shipper to a consignee according to the agreed-upon conditions.
Internal settlement document : for a transportation service provided to you by an internal organization in your
company
Freight settlement document : To settlement document created with your suppliers or carriers for their services
provided
11. Forwarding Settlement Document : A document that is posted to Sales and
Distribution (SD) to request the creation of an invoice to be sent to a customer.
Carrier invoice : the process of settlement between you and your service provider is
based on a carrier invoice that your service provider submits to you against a freight
order
Dispute : submits invoices for the freight orders for any additional services by carriers.
12. Currently in the market there are three types customers/scenarios are using this SAP TM.
1. Shipper
2. LSP ( Logistics Service Providers )
3. Carriers
16. Example of one scenario of transporting from source location to destination
Ware
house
location
Port Location
at India
Port
Location
at India
Port location
at US
Port
locatio
n at US
Customer
location at
US
By Road
By sea
By Road
Means of
Transport
Means of
Transport
Means of
Transport
Mode of
transport
Mode of
transport
Mode of
transport
Pre-Carriage
Main Carriage
Post Carriage
