How can route planning and optimization reduce logistics and transportation cost?

shipsy

Created on March 26, 2021

Logistics and transportations are undoubtedly an integral part of any business. The segment looks after the movement of goods from one place to another. It also takes care of the delivery of goods from the vendor’s place to the customer. Managing the logistics and transportation department is not a cakewalk. A company has to hire big teams to perform various operations involved in logistics. But that doesn’t guarantee smooth logistics management; however, one thing it assures is high logistics cost.

To manage these operations within budget while ensuring safe and timely deliveries, businesses are inclining towards logistics and transportation management systems. Most of such systems provide end-to-end logistics management; however, there are some that follow a modular approach and give the companies freedom to opt for modules separately. Among all the modules, route planning and optimization is the one that can make significant differences to the total delivery cost.

Yes, you read that correctly. Efficiently planned and optimized routes can help any business to cut down the overall logistics and transportation cost while ensuring timely delivery of products. Moreover, it can also contribute to increasing the productivity of riders as they can finish deliveries without facing any difficulty.

With efficient route planning and optimization, businesses can-

Minimize fuel cost

Route planning software or transport software with automated route planning features generates the most efficient routes for delivery. By efficient routes, we mean generating the routes in a way that a vehicle can deliver all consignments on time while following the shortest route considering the delivery location of all the customers.  

Avoid traffic congestions and idling of engines

Route planning and optimization can help riders to avoid traffic congestion, which can further prevent idling of engines caused when vehicles are stuck in traffic. Moreover, the same also leads to reducing the vehicle maintenance cost.

Ensure timely deliveries

A vehicle following traffic-free routes increases the chances for timely deliveries. Delivering orders on time further contributes to decreasing the order returns.

Check delivery ETA

With the help of route planning software, riders, vendors, and customers can check the estimated time of arrival for the delivery. This keeps customers updated with the status of the order and hence, minimizes the number of calls to the customer support team.  

Avoid road restrictions

The technologies used for designing and developing route planning software helps it to find restricted areas or regions where only a particular type of vehicle can go. The software generates the route accordingly, and therefore, saves time as well as the efforts of the riders.

Get dynamic routes

Most of the companies give customers the freedom of cancelling orders or modifying the time and date of delivery at any moment. And when it happens, the route planning software automatically shows new routes, excluding the delivery location of that customer. This helps in delivering other orders on the expected time and bringing the vehicle back to the source early. A vehicle can then plan secondary trips.

Where to get route planning and optimization software?

All the aforementioned factors, together, contribute to lowering down the total logistics and transportation cost. So, now when you know the significance of route planning and optimization, you can choose to get a dedicated module or software to automate this section.

Apart from this, what you can do is to opt for a transportation management system that will not only digitize the route planning process but also automate last-mile delivery solutions for the end-to-end delivery management. To purchase customized route planning or transportation management software, you can reach out to Shipsy, a leading SaaS-based logistics software suite provider. 

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