In the logistics world, people tend to use the terms ‘route optimisation’ and ‘route planning’ interchangeably, and it might seem that they are the same thing. Though these terms relate to mapping out routes, they greatly differ, and we will look at their meanings and how each one works.
What is route planning?
Route planning is also referred to as route mapping or route sequencing, and it simply refers to creating driving directions or routes that are used for multiple destinations. These driving directions are formed on the map, and they are ranked into an order which makes the most practical and logical sense. The routes created for each destination are based on the services or delivery orders based on the customer’s address.
An example of route planning software is Google Maps, as it maps out routes with various destinations to allow you to plan trips with a clear beginning and end. GPS is also another example of a route planner, which is also used by many businesses as companies can utilise GPS tracking devices to manage supply chains, internal and external fleets and delivery networks.
Route planning may be a better option compared to using a pen and paper or using excel. However, when it comes to managing routes for deliveries and that will also be used by field service operations, it requires more than creating a path from point A to B. There are some issues that route planners have. For one, they do not consider other factors that might affect operations, such as customer service, driver schedules, or reverse logistics. Therefore, if a company intends on reaching its full potential, it will require a better solution.
What is route optimisation?
Route optimisation refers to a better method of planning, managing and mapping out routes. Route optimisation assists businesses in excelling in what they do by creating the fastest routes for them based on certain factors and constraints, not only the distance travelled. Some of the factors that route optimisation takes into account when mapping out routes include:
- Types of roads (for example, one-way vs two-way streets, highways vs urban roads)
- Number of road crossings, traffic junctions, stop lights en route
- Traffic patterns (traffic congestions at specific times of the day or season and detours, closed roads, roadworks)
- Determining the best access points
- Driver schedules (lunch breaks, shifts, rest stops)
- Vehicle type (fuel consumption, speed, cargo capacity)
- Delivery windows (dates, exact deadlines, times of delivery)
Route optimisation contains advanced algorithms that allow businesses to control deliveries by ensuring that even their most complex needs are met. Route optimisation enables companies to have control over their end to end operations, allowing for there to be a delightful customer experience. Companies can also establish specific parameters, such as drive time, vehicle weight limits, and shift patterns, which improve optimisation, leading to better delivery and efficiency.
Route optimisation benefits
- Reduced transportation costs
Businesses are always looking for methods that will ensure that they stay within their budget; however, it could prove challenging when it comes to transportation costs. Common challenges that could contribute to higher transportation costs include fluctuating fuel prices, making it difficult for businesses to accurately measure how much money will be spent each day when travelling. When businesses use cloud-based routing software, they can significantly reduce their transportation costs, which improves the company’s bottom line. Using route optimisation software will lead to instant ROI as the company will reduce its mileage, save time planning and limit fuel consumption.
- Increase in productivity
Businesses must travel to plenty of destinations while also ensuring that they meet customer expectations with a limited number of hours in a working day. In a regular workweek, an organisation will have to handle over a thousand tasks, which applies to transport companies. With all these factors to consider, it might make it easy for delivery routes to become cumbersome instead of being seamless. However, route optimisation software makes it easier for drivers to become more productive while remaining safe as delivery routes are optimised based on the goods being transported, equipment needed, and location. This software also makes it easier to analyse KPIs, keep drivers accountable and set goals to improve operations constantly.
- Customer satisfaction
Route optimisation software enables businesses to exceed customer expectations while giving themselves a competitive advantage. Companies might feel added pressure to meet increased customer demands in a world that prioritises instant gratification, such as delivery flexibility, quicker shipping, and live ETAs. The ability to meet customer expectations is essential as customers who have a poor delivery experience are likely to switch to a competitor. Therefore, the business must ensure that products are delivered on time. Another aspect that ensures customers have a memorable delivery experience is sending customer notifications throughout the delivery process, offering live tracking and electronic proof of delivery.
- Remain organised
Managing routes using pen and paper can be frustrating and tedious. It might also be challenging as many routes must be planned for each driver. However, route optimisation assists business teams in remaining organised as drivers can quickly gain information about the routes they must take and the customer’s names, which can help make the delivery process more enjoyable for the customer. The software also includes a mobile app that assists drivers in capturing proof of deliveries through notes, photos and audio.