How to Optimize Route Planning (in 2024)

This is a guide about how to optimize route planning.

So if you’re looking to:

Plan more efficient routes.

Generate more revenue from delivery.

Reduce operational waste and cost.

Spend less time planning routes.

Then you’ll enjoy the actionable tips in this new guide.

Let’s get started.

ON THIS PAGE:

• What is route planning?
• How do you plan a route?
• What does route planning do?
• Why is route planning important?
• The Problem with Manual Route Planning
• What Is Route Optimization in Logistics?
• Why Is Route Optimization Important?
• What Does Route Optimization Do?
• How Do You Optimize a Delivery Route?
• How Do You Create a Route with Multiple Stops?
• Is It Possible to Optimize Routes Manually?
• Can Google Maps Optimize a Route?
• Is There a Better Solution for Routing Multiple Stops?
• What Is Route Optimization Software?
• How Does Route Optimization Software Work?
• What Makes Route Optimization Software Different?

What is route planning?

Route planning is the process of creating routes between multiple destinations on the map in an order that’s both practical and efficient. You can plan routes manually or automatically using software. You can also plan routes based on time, distance, fuel consumption, cost, order priority, and other relevant factors.

How do you plan a route?

When you’re planning a route, the goal is to organize the stops in the most efficient way.

The simplest way to do this is to plan the most direct route from point A to point B to point C.

Traditionally, route planners would use maps, pens, and paper.

Nowadays, simple routing software such as Waze and Google Maps do this digitally.

This is how you plan a route based on distance.

But that doesn’t necessarily mean it’s the best route drivers can use.

The shortest route isn’t always the fastest or most efficient route.

For example, a short route could take drivers on roads with high traffic congestion.

Or roads that require the vehicle to stop at traffic junctions often or cross the line of traffic.

That’s why route planning in delivery logistics has to include other factors such as:

• Delivery date and time
• Pick-up time
• Order priority
• Travel time to location
• Time at destination
• Cost per delivery
• Fuel consumption

Nowadays, you have numerous tools available that can help us plan a route more efficiently.

So even if you have variable conditions that you have to deal with, you can overcome them by using route planning software.

What does route planning do?

Route planning is a branch of distribution and logistics. It’s responsible for coordinating the delivery of products to retail, manufacturing, and residential customers.

Successful route planning ensures that products are delivered to the right consumer, in the right quantities, at the right place, and at the right time.

Route planning also optimizes fleet utilization by allocating orders to vehicles and building effective schedules for drivers.

And it makes sure that the drivers use the most effective route.

Why is route planning important?

When it comes to how you deliver products to customers, every wrong decision you make can affect their experience.

Without pre-determined routes, you risk:

• Not delivering orders on time
• Missing delivery locations
• Failing to deliver orders altogether

Route planning helps you to avoid all of this.

It organizes the delivery operation so you can fulfill orders more accurately.

Instead of using their intuition, experience, or knowledge to find the customer’s address, drivers can rely on precisely mapped routes to drop-off locations.

This means the routes they take are faster and more direct. And it ensures drivers locate the delivery address on their first attempts.

They’ll also spend less time on the road and focus more on their driving.

Even with fixed routes, you get greater control over where and when your drivers go.

That also means more structured schedules, which translates into a higher percentage of on-time deliveries.

The Problem with Manual Route Planning

Route planning is a very complex task.

Depending on order volumes, it consumes a lot of time from your route planner’s workday.

And this still doesn’t guarantee that you’ll end up with completely efficient routes.

So if you manually plan routes, you miss opportunities to reduce waste and improve efficiency.

This includes:

• Cutting down transportation costs
• Raising productivity and performance
• Improving the customer experience
• Generating more revenue from deliveries

But that’s where route optimization comes in:

What Is Route Optimization in Logistics?

Route optimization is the process of raising the efficiency of routes with multiple stops used in distribution, supply chain, transportation, field service, and delivery logistics. The goal is to use the least amount of resources to dispatch vehicles while generating the greatest output and performance.

Why Is Route Optimization Important?

Typically, companies optimize routes to improve their efficiency and effectiveness.

This includes optimizing:

• Cost per stop or route
• Time per stop or route
• No. of stops per route
• Distance per route
• Time on the road per route
• Fuel consumption per route
• Fleet and vehicle usage

In doing so, route optimization cuts overhead, boosts fuel efficiency, minimizes travel time, and raises operational capacity so you can serve more customers.

What Does Route Optimization Do?

To optimize routes, you need to take into account several key factors besides distance.

When mapping routes, logistics managers and planners will typically include:

• Types of roads (urban roads vs. highways; single vs. double vs. multi lanes; one-way vs. two-way streets);
  
  
• Traffic patterns (traffic congestions during specific times of day (rush hours) or season (the Christmas rush), detours, roadworks, closed roads);
  
  
• Number of road crossings (roundabouts, traffic junctions, and stop lights en route);
  
  
• Crossing the line of traffic (left-hand (US), or right-hand (UK) turns);
  
  
• Pick-ups (wait time when picking up products, supplies, equipment, or field service workers);
  
  
• Depot locations (mapping multiple pick-ups at multiple depot sites);
  
  
• Determining the best access points (to enter or exit a street, road, or highway);
  
  
• Driver schedules (rest stops, lunch breaks, shifts);
  
  
• Vehicle type (speed, fuel consumption, cargo capacity);
  
  
• Delivery windows (exact deadlines, dates, times of delivery, urgent deliveries, fixed deliveries, regular weekly deliveries);

For this to work, you need to have an established transportation network (supply and delivery chains).

This means considering your products, vehicles, and staff.

Products

Consider the origin and destination of products and how they move from one geographic location to another. You also need to take into account their characteristics such as size and weight.

Vehicles

A transportation network is divided into different segments. The vehicles you use to cross each one have their own set of characteristics, such as volume size, loading times, cost per mile, and vehicle limitations (vehicle size and speed).

Staff

Consider different team members, their roles, and their ability to complete various tasks. For example, the US Department of Transportation regulates the amount of driving, determining the duration of continuous driving, the length of required breaks, and other factors.

How Do You Optimize a Delivery Route?

The more optimized your route is, the more money your company saves in terms of fuel and labor costs.

But this is difficult to do by hand.

So, many companies today rely on routing software.

To determine the degree of complexity you need from your route planning software you need to observe factors such as:

• The number of stops you make
• The type of delivery you make
• The types of products you deliver
• The current and desired order volumes
  The size and type of your fleet

You’ll also have to answer these questions:

• What are the goals for your organization?
• Can you handle managing delivery logistics alone?
• Do you operate your own fleet?
• Do you outsource operations to a third party?

When looking for a solution, you should consider using route planning software that can help you to:

• Create optimal routes automatically
• Assign stops to routes and vehicles
• Monitor vehicles and drivers
• Keep customers up to date
• Collect proof of delivery
• Set routing constraints
• Connect with additional software

All of this should allow you to automate your delivery logistics.

And it should take just a few minutes to plan and optimize the routes for the entire fleet.

How Do You Create a Route with Multiple Stops?

A good solution for creating a route with multiple stops is using an optimization tool- a multiple stop route planner.

This tool can automatically create dozens of routes for your drivers for multiple drop-off locations.

The planner can also adjust routes for many factors such as:

• The optimal time
• Delivery windows
• Fuel consumption
• Driver breaks
• Vehicle capacities

All of this is done automatically, just by clicking the button.

To add the stops, you should be able to upload the orders manually, in bulk (via .pdf or .csv files), or automatically by integrating the software with an OMS.

The system should then transfer the orders into tasks. And then, assign each one to a driver or vehicle at the click of a button.

Is It Possible to Optimize Routes Manually?

Technically, yes.

But the amount of time and work required to optimize routes based on just one parameter by hand means it’s simply not efficient.

Still, it’s surprising to see that many companies plan routes manually.

To be clear:

This depends on your order volumes.

If you don’t have too many deliveries, then it makes sense to do them manually.

The same is true if you rely exclusively on fixed routes.

But for most businesses that’s not the case.

So you’ll need to rely on at least some kind of software to make delivery more efficient.

Can Google Maps Optimize a Route?

Google Maps is often misused as a route optimization tool.

It can be used to design a route that includes several stops.

But the number of stops you can add per route is limited to ten.

At the same time, the software isn’t designed to find the optimal stop order.

And you can’t use Google Maps to select the most efficient route you want.

That has to be done manually.

So using Google Maps for route optimization isn’t really an option.

And if you have complex operations that handle large order volumes, you’ll need to rely on a different tool.

Is There a Better Solution for Routing Multiple Stops?

YES, there is.

Actually, there are many advanced routing solutions available on the market that you can use to map multiple stops.

The only question you really need to answer is:

What kind of software do you need?

This will depend on the size and complexity of your delivery logistics.

You may need a specialized tool like vehicle route optimization software.

Or you may need a more end-to-end solution like delivery management software.

Both of these types of tools have route optimization capabilities.

Both of them adopt a cloud-first approach to managing delivery logistics.

Both centralize your logistics management, dispatch, and routing.

Both are fairly affordable in comparison to on-premise and legacy solutions.

And you can use both to optimize your route planning.

The only difference is that one is specifically designed for routing.

While the other has numerous capabilities that automate your entire delivery process.

What Is Route Optimization Software?

Route optimization software is a digital tool that automates how you plan and optimize delivery routes. You can use it both for route planning and optimization. But also for creating delivery schedules and dispatching, as well as managing and monitoring operations in real-time.

How Does Route Optimization Software Work?

The route optimization software is mostly used to plan and map out routes to drop-off points.

You can build driver profiles with routing software. These driver management capabilities can be used to build routes that fit task requirements based on the vehicle, skill, or proximity.

After you have completed planning the routes, the driver will automatically receive them through the delivery driver app.

You can access information about your routes anytime.

When it comes to the supply chain, the software can be used to schedule single or multi-depot operations. As a result, you are free to add as many sites as you want.

The software can easily support a hundred vehicles, and multiple fleets, no matter if you have an internal or external delivery fleet.

The whole process takes only minutes to complete, depending on the number of vehicles and tasks.

You can also access your previous routes and tasks since the software stores that information.

What Makes Route Optimization Software Different?

Customers would have a better experience with your business if you optimize your routes.

When the customers have unique requirements, route optimization software considers them for more efficient delivery.

Route optimization gives you leverage over the finer details. You can set parameters for almost anything. Vehicle weight limits, drive time, shift patterns, and other factors are all taken into account to optimize routes in real-time to meet your needs.

As a result, your company’s routing would be more effective, allowing you to fit more deliveries into your day.

Besides improving your customer service, route optimization gives you more control over managing your operations.

If you want to learn more about this topic, we can help.