Route optimization for delivering products and services is the process of determining the most efficient and cost-effective method of getting them to the customer. For example, if you manage multiple orders at once for an e-commerce business, an optimization tool can assist you with choosing the best route to deliver to each customer efficiently. Then, your driver can take the fastest route and make as many delivery stops as possible along the way.
That said, route optimization is more than just finding the shortest path from point A to point B. There are other variables involved as well including service time at the delivery site, real-time events such as road closures, traffic and weather conditions, availability of drivers and vehicles, personnel for and loading and unloading employees, to name a few.
When you optimize your delivery route, you gain numerous benefits. The most important advantage of route planning is that it reduces costs and maximizes capacity utilization, both which are important factors for any company.
Plus, as a result of AI-enabled delivery route optimization, customers and shippers can both get an accurate expected time of arrival (ETA), helping to reduce failed deliveries and ensure great customer service and better visibility. With an effective delivery management system in place, you can reduce your costs and offer more focused and targeted delivery services, which will increase your return on investment.
With the help of route optimization techniques and tools, it is possible to effect a digital transformation of your delivery planning processes—taking them from reactive and inefficient to strategic and proactive drivers of real business value. The trick is to make sure you’re prioritizing the factors that have the biggest impact on your ability to stay agile and flexible in your delivery plans while ensuring delighted customers.
Key Route Optimization Techniques
By reevaluating how you plan your delivery routes, you can reap the rewards of productive employees, on-time arrivals, and happy customers. Dynamic route planning technology and optimization can instantly improve your delivery efficiency. Here’s how:
Ensure connectivity with drivers
The way you approach each day may be based on your fleet managers, dispatchers, and route planners’ knowledge. But connectivity with drivers is just as important when it comes to iterating on your plans and improving performance. Here are few ways you can leverage driver connectivity to get smarter about route planning:
- Keep an eye out for service or delivery types that tend to require more time for deliveries, and plan accordingly.
- Identity traffic bottlenecks and peak hours that cause problems
- If there are certain drivers familiar with specific customers or use-cases (i.e. installations that require special skills), assign them to those as much as possible.
Of course, in a perfect world, your truck route optimization software would constantly be collecting this data automatically based on live status updates from drivers out in the field.
Consider customer preferences
When customers are able to self-schedule their own deliveries, they’re more likely to be home to receive their order and they're more likely to feel like they've gotten great, personalized service. To make this happen, however, you need to be able to prioritize particular orders at particular times within the app without potentially overextending your capacity.
Advanced delivery route optimization software should be tailored to your needs. If you’re offering customers a choice of timeslots, your routing should be able to handle that without losing efficiency.
Minimize wasted time with good UI
It is important to have a solution that provides you with control and flexibility when you need to modify routes. The ability drag-and-drop, for instance, enables you to move delivery schedules around, re-optimize schedules, or swap routes between vehicles seamlessly. Aside from allowing you to make changes in real-time, a great user interface also lets you analyze the impact before you approve and dispatch the changes to your delivery teams. All of this enables you to work more quickly and efficiently.
Keep your word
Customers today are more concerned with companies living up to their promised delivery time windows than they are with speed. Businesses that are unable to meet customer demands may damage their reputation and see higher customer churn.
Your route optimization solution’s algorithm needs to ensure that the right order is assigned to the right resource at the right time. But it also needs to generate ETAs for stops that drivers can dependably meet. This involves accurately estimating not just drive time but also service time, which can be tricky. But the results are more than worth it: fewer late deliveries, happier drivers, and delighted customers.
Streamline paperwork and eliminate guesswork
Whether it's smarter fleet management or improved office productivity that you're looking for, the right route planning software can help. When you have visibility into road updates, you don't have to wait for phone calls or rely on and use your instincts. You can have visibility on updates such as live ETAs, GPS location, and order status updates. In this way, the last mile goes from being a black box to being totally legible by planners and dispatchers.
Reduce the chances of error
Providing last mile services can be challenging. To do it well, you sometimes need to be a jack of all trades: you manage driver performance, ensure fleet safety, keep costs within budget and handle surges in customer service calls, among other tasks. Given that there are so many things to keep track of, smart, automated route optimization can help you avoid making mistakes and focus on more important tasks.
Route planning delivery software can help you stay on top of things through various ways. The right software should do more than just automatically ingest orders and generate route plans—it should also automatically dispatch orders to drivers and track order statuses from the warehouse to the customer’s doorsteps. Likewise, a powerful route planning solution lets you establish rules that the algorithm won't violate unless they're overridden, so you don’t have to manually tinker with the output of the software every time you run a route.
With the right route optimization techniques, you can make better, more data-driven decisions, ensuring your day runs more smoothly. Routing, planning, final mile tracking, communicating, and analyzing your last mile delivery operations can all be done from one centralized platform with the right software—resulting in better business outcomes and happier customers.