October 13, 2014
Column | techwatch

Who's using YMS and why (or why not)

Despite demonstrated benefits, yard management systems haven't seen widespread adoption—particularly among smaller companies. A recent DCV survey offers some clues as to why.

By James A. Cooke

With their ability to track the location of trucks and trailers, yard management systems (YMS) can alleviate the chaos in a busy distribution center (DC) yard. For instance, they can help ease a logjam at the gate by automating vehicle check-in and check-out, or help users pinpoint which trailer contains goods that need to be unloaded right away to fill an order.

Although this type of software has been around for a number of years, it hasn't exactly caught fire among logistics professionals. A recent DCV survey offers some clues as to why this is the case.

The survey itself was conducted via an online poll earlier this fall. Of the 115 logistics managers who participated in our survey, only 33 percent said they were using yard management software in their operations. As for which industries these YMS users worked in, 38 percent said they were in the wholesale/distribution business, 25 percent in retailing, and another 25 percent in transportation/logistics. Manufacturers accounted for just 12 percent of the YMS users.

Asked how long they've been using the software, the largest share of YMS users—47 percent—said they had been using their yard management system for one to five years. Another 30 percent said they'd been using it for six to 10 years, while 20 percent had used the software for more than 10 years. Only 3 percent said they had been using the software for less than one year. Given the small percentage of new users, the survey results suggest that the YMS market is seeing only nominal growth.

In addition, the research indicates that it's mainly large companies that have deployed a YMS. In fact, 42 percent of the YMS users in our survey worked for companies with revenues in excess of $1 billion. Thirty-one percent of users were from companies with between $10 million and $99 million in revenue, and 24 percent worked for companies with revenues between $100 million and $999 million. Only 3 percent of YMS users worked at companies with less than $10 million in revenue.

When asked about the type of YMS software they were using, the majority of users—57 percent—said they used a standalone application. Another 40 percent said the YMS they used was a module in their warehouse management system (WMS), and 3 percent said it was a module in their transportation management system (TMS). Among other findings, the survey revealed that the yard management systems used by smaller companies are typically standalone applications, while those used by big corporations (those with $1 billion or more in revenue) tend to be a component of their WMS systems.

When asked to name the number one benefit of using the software, 61 percent of the YMS users cited improved yard visibility. Another 14 percent said the software had brought about improvements in their daily DC operations. Other benefits cited included a reduction in DC labor costs and enhanced inventory efficiency (each mentioned by 11 percent).

However, the fact remains that the majority of survey takers reported that they had not deployed a yard management system at their facilities. When asked about their reasons, a third of the non-users—33 percent—said they saw no value in the application. Another 18 percent said the software was too expensive, while 11 percent did not send or receive freight by truck, making usage a moot point.

What was particularly interesting were the explanations given by the other 38 percent, the folks who checked "other" when asked about their reason for not using a YMS. Many said their current traffic volumes weren't high enough to warrant use of software. Still, one comment from a reader was particularly telling: "When we looked at it, the offerings required more effort than the payback [would justify]."

Although a YMS seems warranted in operations that deal with swarms of arriving and departing trucks, the software's use appears limited for now to large companies with extremely busy yards. Clearly, many small and medium-sized companies don't feel they have the volume of traffic to justify the time, money, and effort.

About the Author

James A. Cooke
James Cooke is a principal analyst with Nucleus Research in Boston, covering supply chain planning software. He was previously the editor of CSCMP’s Supply Chain Quarterly and a staff writer for DC Velocity.

More articles by James A. Cooke

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