Logistics. It’s the most important thing to consider when offering a quality delivery service to customers.
Sure, you need vehicles and storage facilities to carry out operations. But good logistics are to delivery operations what the mind is to our bodies – an essential part of a whole.
It lets you create an efficient symbiosis with the transportation network so your operations can run effectively. And getting it right is the bane of all companies and their delivery services.
Like with everything, the first step is key. It all starts with a plan. But how you lay out that plan is far more important than just having one!
When talking about product or service delivery operational layouts, there are two ways to go about it:
Both aim to overcome the same logistical challenges, like finding optimal delivery routes, increasing speed and efficiency, minimizing operational costs, and maximizing the use of resources. But only one type of planning is right for you, and your path to success and scalability.
Here to help overcome these challenges is an overview of planning at a depot level versus a more centralized system.
Depot level planning is a type of delivery logistics where each depot is managed independently. This way of organizing operations provides greater autonomy and flexibility, as each hub is responsible for planning, scheduling, and executing incoming orders by managing its own resources.
Running operations at a depot level require each facility to have a skilled staff that can successfully manage, communicate, and carries out its activities simultaneously with other depots without hindering them. As a result, the two main issues with this type of planning are usually cost and communication.
That’s why planning at a depot level is best suited for small businesses with smaller fleets and a few depot locations.
Let’s take a look at two independently-managed depots. Both sites fleets which are managed by their own teams who receive orders, schedule deliveries, and plan out their routes. Thus, there is a lot less communication and overlap, and both facilities can thrive on the main advantages of the system – autonomy and control at a depot level.
By contrast, planning at the depot level becomes more complicated logistically speaking when applied to a larger scale. Even when scaled to three depots with 10 vehicles each, the task of organizing operations is considerably more complicated with substantial loss of efficiency.
The first significant problem is route planning. It becomes much more difficult to create delivery routes for individual vehicles as each one needs to reach more stops efficiently, while other planning variables and required constraints are also increasing exponentially.
The second problem is resource management. As you increase the number of depot sites, you need to hire more people to manage those facilities when you plan activities at a depot level. If you scale up to ten depots, you need to hire ten service managers or dispatchers, or both, to manage your entire operations.
Finally, communication is much more difficult when planning at a depot level. Whenever you increase the number of people working on operation, there is more of a chance for miscommunication. And when that happens, it is impossible to **effectively coordinate activities **between teams.
That’s why if you’re just introducing a delivery service as part of your offer, start planning it at a depot level. As you grow your service and create a need to scale it, you can easily transition to a centralized planning system that is better suited to large scale operations.
Centralized multi-depot planning is a type of delivery logistics planning where every part of the operation is managed from one central hub. This gives planners an overview of all orders, activities, and resources to comprehensively plan and schedule pickup and delivery routes for the entire fleet.
As with single-depot planning, the success of the centralized system relies on a quality communication network. But unlike the previous model where communication is horizontal, in this type of planning information flows vertically.
In a centralized delivery scenario, a single team is responsible for organizing the entire delivery lifecycle. Once a plan is in place, the schedule is dispatched down the line to all depots and fleet drivers. Likewise, the teams in the field can relay information up the chain, back to the central hub.
The two-way flow of information is simpler and allows managers to monitor progress on each delivery. They can make adjustments to the initial plan to overcome unforeseen events, or include new deliveries to the schedule and plan routes as they come in on the Order Management System (OMS).
Having a centralized planning system in place also enables teams in the main hub to optimize their plans day to day, to streamline every delivery route. As a result, this can in time increase efficiency and reduce operational costs of running a delivery service.
That’s why small-to-medium organizations and large-scale enterprises use centralized delivery planning to plan and manage their fleets and multi-depot networks.
Even though each type of logistics planning has appeal in a specific context, there is a way to improve both methods and apply either one of them successfully to your organization.
The solution is to use a powerful multi-depot delivery routing and scheduling software.
Unlike traditional planning methods that rely on a host of disconnected systems, a multi-depot SaaS solution takes centralized planning to another level.
It lets you apply the centralized way of planning delivery to multiple, as well as a single depot, and gives you the ability to plan, manage and optimize all of your operational activities in one place.
One team can easily take into account all operational parameters at once to plan each delivery with an unprecedented level of detail:
As a result, you receive the benefits of planning at a depot level (detail-oriented planning and flexibility), as well as the advantages of centralized multi-depot planning (easy communication and streamlined operational management).
Best of all, the entire plan is optimized for efficient resource use and distribution to reduce cost and maximizes effectiveness, visibility, speed, and control.
BOOK A DEMO and see how a powerful cloud-based multi-depot delivery routing and scheduling software works for yourself.
eLogii was created with planners in mind. It enables them to create optimized delivery plans in minutes, rather than hours. They can now focus more of their energy on developing a better strategy based on actionable insights from the field, and, more importantly, reduce costs and grow your bottom line!