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The Top Three Benefits of Dynamic Route Planning Software
The Top Three Benefits of Dynamic Route Planning Software
Nov 10, 2021Jim Endres
Routing and scheduling software used to be an expensive proposition, which meant that only the big transportation firms used it. Now, with cloud-based applications, nationwide cellular networks and easy access from mobile devices, route optimization software is available and affordable for smaller logistics enterprises.
The best part? ROI on routing software is normally within 6 months. If you thought that dynamic route planning software was out of your reach, think again. The benefits far outweigh the initial expense. But what is dynamic route planning software, and how can it advance your company?
We’re glad you asked. Below, we give you an overview of what dynamic route planning software is and its advantages for you.
What Is Dynamic Route Planning?
While route optimization isn’t a new concept, static routing was the norm for decades. What’s the difference between static routing and dynamic routing?
The major difference is that dynamic routing can take thousands of real-time factors into account to create the most efficient routes. Even certain static route factors, such as route number and sequence within route—which forms a hybrid approach—can be factored in. For example, some variables might remain static, such as these three particular customers must be on route seven and in a set sequence. However, every other customer order is dynamic, meaning it can be placed on the most optimal route.
In contrast, static routing doesn’t factor in any changes that are learned from actual route execution. If your company has a set volume and a set number of stops, static routing might still work for you. But today’s modern logistics companies must take a different approach to preset routes, even in small rural areas. A simple fact—routes that don’t change to reflect planned vs. actual route information aren’t optimized. As implied by the name, dynamic routing offers flexible, adaptable routing that changes constantly based on incoming information, all the while honoring previous promises to your customers.
Fleet managers can constantly monitor each driver and each route and make changes as unexpected circumstances occur. No one can predict accidents or inclement weather events. Nonetheless, dynamic routing software gives you the tools you need to pivot your delivery operations as needed.
Okay, so now you know the basics of dynamic route planning. Let’s discuss how comprehensive routing and scheduling software will give you immediate cost savings, happier drivers and long-term customer satisfaction.
1. Decreased Total Cost of Operations
As you know, fuel is one of the biggest expenses your dispatch operations accrue on a daily basis, and one of the most variable. Studies have shown that adding routing software and optimizing routes can reduce fuel costs by 5% to 10% instantly, because it reduces miles traveled.
Since drivers are now running more efficient routes, this leads to decreases in labor costs, and virtually eliminates overtime hours. This can translate to almost 20% savings in labor costs alone, which is generally the highest overhead expense of any transportation company. According to ATRI, driver wages and fuel costs make up almost 60% of total operational costs. Imagine if you can shave 20% off that. How much would you save?
In addition, more efficient vehicle utilization means less wear and tear on trucks, which means lower maintenance costs. On average, most companies see a 10-30% overall decrease in operating costs once they implement advanced routing and scheduling software. That’s huge. What could you do with an extra 30% to invest in your business?
2. Increased Driver Satisfaction
Companies everywhere are scrambling to hire new drivers and keep the ones they have. Knowing that, it’s imperative that you keep your current crew satisfied. And, like many businesses right now, you may be looking into how to attract young drivers into the industry. Adopting route optimization software can help you do both of these things, because you can use it as a recruitment and retention tool. How? It’s simple—better delivery route planning makes for happier drivers as they return on schedule. It’s about work-life balance.
Drivers will know every day that the route they are taking is the best route. They will also know that their knowledge of the customers and the route will always be taken into consideration. For example, you may have a customer that has changed their set delivery times from afternoons to mornings. The old manager preferred mornings, but the new team has seen that afternoon business has picked up significantly. Their old manifest was set for afternoon deliveries, which the software noted. But your driver has a great relationship with the store manager and knows about the change. The driver imparts that intel to the fleet manager and the route is updated accordingly.
Drivers will also know that they won’t miss appointment times or ideal unloading times, because dynamic route planning software figures in thousands of factors, including planned delivery windows, historic traffic conditions, and even one-time events, like a football game.
Route plans are achievable and updated constantly to reflect changing real-world conditions. For instance, maybe your driver has noted that he is always kept waiting at a particular stop. Your customer service team can investigate it and figure out a better time to deliver so that the delays cease. Because the system gives you immediate visibility into issues, your drivers are more likely to be where they need to be at the right time. This also means that they can finish their shifts in a timely manner and avoid overtime.
3. Happier Customers
The customer runs the show now in the delivery game. The days are gone when an all day, or even a four-hour delivery window, was sufficient. Today’s customer is also very tech-savvy. 93% of customers have stated that they will research a company online first, and an additional 87% said that they read online reviews of businesses first. That means that your company needs to have impeccable customer satisfaction to grow. How can you achieve that? By utilizing dynamic route optimization software.
Because deliveries can disrupt the normal flow of business, your customers want a narrow delivery window at a time that is most convenient for them. Agile route planning software can help you meet even the most stringent customer demands. As planned vs. actual route data comes to light, users can adapt the system for future scenarios, because the system operates on a continual improvement loop. Maybe you have a customer that is undergoing renovations to expand. This means that parking is at a premium, and their delivery window needs to change to reflect that. You add that data to their account, and voilà. The customer’s delivery window changes until construction is complete.
The biggest benefit to routing software is that both you and your customers have 360-degree visibility—in their preferred mode of communication. Let’s face it—traffic is unpredictable, and accidents happen. However, once you are aware of a delay, so is your customer, via SMS, email, or a delivery tracking portal. This is proven to reduce up to 50% of the endless WISMO (Where’s my order) calls that your customer service team needs to field, which leaves them free to handle bigger issues. Since the average inbound call costs $7.00 to manage, eliminating these calls is another substantial source of savings.
Dynamic routing and scheduling software isn’t magic—it cannot transform your employees overnight, nor will software replace the knowledge of your veteran drivers. But what advanced routing optimization software—like Aptean’s—can do is make your staff more efficient, more productive, and improve your service. Look at it this way. Better routes mean better customer service, period. You reduce costs, increase operational efficiencies, get happier drivers and satisfied customers.
Excellence in transport operations is a key differentiator for you. You take pride in your team’s ability to deliver on what you have promised with the minimum impact to the customer’s business. With dynamic routing and scheduling software, you can keep those promises—now, and in the future.
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