Route optimization

What Is Route Optimization (And Why You Need It)?

What Is Route Optimization (And Why You Need It)?

How do you figure out the best way to reach point A from point B?

Why do you, for example, always take the same route to get to the office each day?

Is it because it is the shortest route? The fastest one? The one with the least traffic, maybe? Or is it because you can pick up a cup of coffee on your way to work?

It is probably all of those things and more. All of those reasons make it the best possible route to reach your destination. In this case, the office.

When it comes to delivering goods or services, the logic is the same.

A delivery fleet has to use the best route to each customer using the least amount of time and resources to complete a delivery.

But unlike simply reaching point A from point B, delivery fleets have a lot more stops to make. Even with shorter runs, the number of factors and variables that determine the best route remains incredibly high.

Not to mention, all of the constraints of running a route, like pickup locations, driver schedules, customer demands, and many others. All of them make finding the optimal delivery route an extremely complex ordeal, too.

Plus, a delivery route is never the same. Unlike your way to work, it never occurs under the same set of circumstances.

So even when you come up with an ideal path from point A, to point B, all the way to point Z, you still have another round of route planning once new orders pour in.

Put it all together, and you have a real logistical puzzle on your hands.

So, what do you do in a situation like this? What do you do when you want to determine the best route (and the best use of those hard-earned resources)?

You turn to route optimization.

What is route optimization?

Route Optimization is the process of establishing the most cost-effective route between multiple locations. It makes the best use of available resources to reach each destination in the shortest time. It takes into account key factors to achieve this, such as the number of stops and the distances between them.

Sometimes, the process is mistaken as routing, route scheduling, or route planning. But the process goes beyond that. It’s far more comprehensive.

To be truly cost-effective, route optimization takes into account other relevant factors to determine the optimal route, like:

  • Types of roads (urban vs. highways; single lanes vs. multi lanes; one-way vs. two-way);
  • Traffic patterns (traffic congestions at a specific time of day, detours, roadblocks);
  • Number of turns, intersections, traffic lights, and roundabouts;
  • Crossing the line of traffic (left-hand turns in the US; right-hand turns in the UK);
  • Pickup times (of products, equipment, or service workers);
  • Depot locations;
  • Best access point to the stop;
  • Closest or best-suited driver on the route to pick up and drop off;
  • Driver schedules;
  • Vehicle type and their cargo capacities;
  • Delivery times (delivery by the specified time, regular deliveries, urgent deliveries, etc.).

Therefore, it’s not enough to simply know where a driver is heading, but where will they pick up, what will they encounter on their way to a stop, how long will it take to reach the destination, and by what time do they have to arrive. Not to mention, who the driver is, and whether they are driving a van or a trailer truck.

Even without all of these constraints, there are far too many options to choose from. For example, a single vehicle in your fleet which needs to make 10 stops has over 1, 2, or sometimes 3 million possible routes. That’s before you take into account any of the factors.

But to be truly efficient, you need to include those into your calculation, as well. And all of this has to happen on every single delivery run in your entire fleet!

Luckily, there is a solution. It’s called route optimization software.

What is Route Optimization Software?

Route optimization software is a digital technology used to automatically calculate the most efficient paths between a series of stops for a vehicle fleet. It uses a set of complex algorithms to factor in multiple constraints and determines a route that is efficient, cost-effective and meets customer and stakeholder demands.

Traditionally, delivery service planners relied on manual route planning. They would only use maps, splitting them into zones and visually planning routes based on the shortest distance between two stops (without factoring in anything else). This might seem efficient, but it isn’t.

So, when they wanted to increase the efficiency of their delivery routes, the process became simply impossible to do manually.

Why Do You Need Route Optimization Software?

As technology improved, software and logistics experts came up with an enhanced approach to solving VPR using computer algorithms. This was the first step in creating route optimization software as we know it today.

Nowadays, route optimization software is an umbrella term used for a number of automated actions this type of software is able to perform.

First, this technology is always connected to the Internet. Software like this can access a vast amount of data necessary to factor in every conceivable external constraint and make split-second calculations.

For example, route optimization software has access to GPS maps. This allows it to use precise maps when locating stops and delivery addresses, so it can create accurate routes. In turn, this minimizes the chance of failed deliveries, or missed stops.

Beyond that, it can access traffic systems in real-time. This can then be used to establish routes with the least amount of traffic or provide dispatchers with actionable live operations data which can be used to help drivers in the field. Thus, reducing costs on fuel consumption and driver overtime.

Before, this type of software, delivery managers relied on multiple disconnected digital tools to complete the same tasks. Now, every segment of planning, optimization, and execution of the delivery lifecycle is located on one platform.

Besides reducing the manpower necessary to plan and schedule delivery routes, it also streamlines the process. With the route optimization software in place, a business can manage its depots and fleets, and dispatch drivers from one central location. Improving communication and visibility.

But there are even more benefits of route optimization software to look forward to.

We have everything you need to start improving your delivery.

Here are the nine free guides that will show you exactly what we do to optimize the last mile and dominate delivery logistics.

1. The definitive and complete guide to Route Optimization Software

2. Why mapping multiple delivery stops is impossible without software

3. How to leverage Route Planning Software to drive delivery excellence

4. What is Delivery Management Software?

5. How we crush customer experience with delivery management software

6. Where to find and how to choose delivery management software

7. Delivery Management Platforms

8. How we dominate reverse logistics and eCommerce returns

9. How teams dominate remote work using nothing but Field Service Software

See how it works in action

eLogii is an end-to-end cloud-based delivery management platform. Our powerful solution solves the biggest challenges of modern distribution and field service businesses, including: route optimization, planning and execution.

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