…and what exactly is Route Optimisation?
So, you have a fleet of vehicles that visit multiple destinations every day to complete jobs, for example delivering parcels.
You receive revenue for every job completed and incur costs in time (hours worked) and distance (km driven).
Therefore, to maximise profits you need to plan routes that efficiently serve jobs, minimising hours worked, and kilometres driven.
Now, unfortunately, you have just stumbled upon a very difficult problem; the Vehicle Routing Problem (VRP)
For a small number of jobs and vehicles it is possible to do this manually or using only Google Maps but, as the number of jobs increases and additional constraints, such as customer time windows and vehicle types, are added the problem is best addressed by a computer.
You need an algorithm to solve the problem and plan your routes!
How Does It Work?
So how does this algorithm plan routes?
In short, the same way you do, guess, evaluate the proposed solution, make an improvement, evaluate again… rinse and repeat. (A heuristic approach for the mathematicians out there)
Its advantage is…
…It is a computer; it can calculate and iterate a lot faster than you can!
And… there are some fancy things the algorithm can do so that it searches in the right place and, more and more, some solutions also employ machine learning and artificial intelligence techniques to learn from drivers and routes they have previously driven.
Ultimately this means that in a short period of time a route optimisation algorithm can consider thousands of possible routes and …
… propose routes that are 30-40% more efficient than routes planned by hand! *
(*even if they are not the “optimal” routes, as it is almost impossible to prove this in a NP hard problem.)
Why Use Route Optimisation?
If 30-40% more efficient routes are not enough to convince you that using an algorithm to plan your routes is the way to go, then there may be no pleasing you!
Still there are some other benefits that might just get you across the line:
Time: Spend less time planning routes and more time growing your business.
Growth: Now that you have time to grow your business you can serve more customers with the same fleet
Quality: With better planned routes, that consider customer delivery time windows, you can propose accurate ETAs to your customers, improving their delivery experience
Environment: With efficiently planned routes you improve your jobs completed per kilometre driven ratio, reducing the carbon intensity of your vehicle fleet.
And this is just to name a few, there are plenty more!
What About Delivery Management?
Good question, anybody who has spent time in transport operations knows that…
…no plan survives contact with a peak hour accident!
Your planned routes do not exist in a vacuum. Ideally you need your route optimisation and delivery management systems to be tightly linked so that transport planners can track route progress in real time. Then, when incidents occur, they can react quickly to re-optimise routes and ensure that, despite the disruption, jobs can be completed on time.
Additionally, by combining your route optimisation and delivery management systems you can easily compare your Planned vs Actual performance to easily find the areas, mistakes and shortfalls that are costing your business money.
Where Do I Get One?
Well, we may be a little bit biased, but since you have already made it this far, I think you should check out our platform, Tarot Routing.
We offer a 2-week free trial so you test and see exactly why…
…you should use an algorithm to improve your routes!
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