Why Vehicle Routing?

Why Vehicle Routing?

What would an 8% saving in your direct distribution costs mean to you? This type of saving has been achieved by use of vehicle routing in diverse industries – such as paper delivery, lubricants and food services.
And it’s not just direct savings, Vehicle Routing also benefits you through:

  • greater accuracy of plans
  • improved customer service
  • reduced planning time
  • improved management control
  • better environmental responsibility
  • better use of resources
  • coping with business change and growth

Savings

Vehicle Routing software typically produces plans that are between 5% and 15% more efficient than manual planning. This is achieved through a combination of intelligent algorithms that use efficient methods for creating trips and through the sheer computational power of a modern computer – which enables it to consider many thousands of different combinations in an “optimisation” run. Exactly how much you will achieve can vary considerably but the following factors are all likely to increase the saving:

  • Bigger problems
  • More complex problems – including rules like time windows, vehicle compatibility and loading requirements
  • Time pressure on the manual planner
  • The variability of the problem from day to day
  • The skill and experience of the manual planner

The savings quoted are typical in like-for-like planning. However, you may achieve even greater savings through the use of the routing system to review what you delivery and when (see strategic routing)

More Accurate Plans

Not too long ago, people relied on experience to work out how long a route would take. These days, however, there is a wealth of data to make quite accurate predictions. Apart from breaks and time spent at the depot, a driver’s working day is split between time driving and time at customer premises delivering or collecting goods.. For typical multi-drop work this can often be around 50:50. Both types of activity can be measured and estimated quite accurately.

For driving time, the data is drawn from a combination of detailed road networks and “historical” road speeds. We make use of historical road speed data which gives drive times by for all major and B roads, in each direction, in 15 minute intervals across the day. This data is then used to calculate the drive time estimates.

For time at the customer, the best source is data collected from a combination of proof-of-delivery and tracking systems. This can be compared with what was actually being delivered and used to predict delivery times customer-by-customer based on the amount actually delivered. Optrak provides tools Optrak Realisation and Optrak Logistics Intelligence to help with this data.

Improved Customer Services

Customers often have delivery time windows and other special delivery requirements. By building this data into the planning “model” you can ensure that the optimisation will obey all the rules. The improved accuracy of the planning makes the achievement of these customer requirements easier. And everyone wants to know when their delivery will arrive. Optrak Messenger can be used to automatically send customers notifications of planned arrival times by email or SMS. And when combined with Optrak Realisation and on-truck recording, this timing information can be updated to take into account of unforeseen on-the-road schedule changes.

Reduced Planning Time

We have customers who have reduced the planning from a two-person, full day activity to just one hour for one person per day. The saving in planner’s time alone has justified the cost of the system.

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