Route Optimization Software: The Complete Guide - Part 1

Route optimization is a crucial task in logistics and transportation, as it allows businesses to reduce costs, improve efficiency, and minimize their carbon footprint. 

There’re several types of software that can help optimize routes, from navigation and mapping apps, to fleet planning and management tools.

Some common features of this type of software include the ability to plan and optimize routes in real-time, taking into account factors such as traffic, weather, and load restrictions, and providing real-time tracking and monitoring of vehicle location and status. Some software, such as the one used by Drivin, also includes additional functionalities such as cargo and documentation management, fleet management, and task assignment to drivers.

Source: Envato

There are many route optimization software options available in the market, and the best option for a company will depend on their specific needs and size. Some things to consider when choosing route optimization software include ease of use, flexibility, integration with other systems, and the ability to adapt to the company's needs as they change over time.

If you’re counting on, or considering investing in a routing optimization software, you could be sitting on a gold mine of incremental profits without even realizing it. Whether you’re a distributor, manufacturer, or retailer, your trucks and drivers constitute a significant percentage of operating expenses. 

The efficiency gains from fleet performance optimization can offer six or seven-figure savings, while simultaneously improving delivery service through techniques for optimizing distribution routes.

What’s the key to unlocking the benefits of a logistics software? Essentially, ensuring that your fleet operates at maximum efficiency every day. In this guide, we will explain all aspects of why it’s necessary to include routing optimization software in your business: from the practicalities of how it’s done, to advanced optimization strategies for large fleets.

What’s a transportation routing software, and how does it set my business apart?

A routing optimization software helps in the process of determining the most efficient route for a vehicle - based on a set number of stops and all the external variables that can affect the trip - to deliver orders within the established time windows and under optimal conditions.

Ultimately, the use of software in logistics can realistically reduce fleet operational costs by 10-30% and significantly increase customer satisfaction by reliably meeting ETA goals.

Source: Envato

Furthermore, companies that have prioritized routing optimization through a logistics routing software enjoy the following competitive advantages:

• More efficient and profitable operations
• Happier and more loyal customers
• A more agile and responsive businesses

Why is the market driving the need for transportation routing optimization software?

With an increase in both customer and industry expectations, as well as social trends, fleet operators have been put under constant pressure with business looking for the best experience possible when it comes to optimal route management for efficient deliveries. 

Here are some examples of why the market is driving the need for more efficient routing. 

Tighter time windows

With Amazon ever-looming, customers expect things fast, now, and on time. Staying on top of customer demands and paying special attention to keeping up with your competitions’ delivery timelines and reviews is a best practice that guarantees your chances of staying in-the-game. 

This is where route optimization software shines, since one of its main abilities is to make drivers stick to the program while monitoring them in real time. 

You can also set expected time windows for each delivery depending on the road conditions of the day, as well as any package limitations or special handling requirements. 

More efficient deliveries

The most efficient supply chains use less inventory within production and the warehouse, allowing for better control over complex deliveries, translating to more just-in-time deliveries and higher delivery success rate. In this case, the use of a logistics control software allows you to optimize and automate operational processes, saving heaps of time and money, honey. 

Greater demand for visibility on ETA

Customers want to know exactly when their products will arrive, whether it is food delivery or convenience store goods. Companies that know this information can schedule people to receive the products, prepare the receiving area, and gain the efficiencies that result from proper use of logistics software for routing optimization.

Fuel costs

It’s difficult to provide an average savings percentage for fuel when implementing a route optimization software as it can vary greatly depending on all sorts of factors such as the size and type of fleet, the specific software being used, and the specific routes being optimized. 

Some businesses may see fuel savings of up to 20% or more, while others may see smaller savings.

Urban delivery restrictions

Urban delivery restrictions, such as regulations on commercial deliveries during certain hours of the day, can impact route optimization in a number of ways. These restrictions may limit the times when deliveries can be made, which can affect the efficiency of routes and the ability to meet delivery windows.

In order to comply with these restrictions, businesses may need to adjust their routes or find alternative delivery methods. A route optimization app with features such as real-time traffic updates and the ability to quickly adjust routes can help businesses navigate these restrictions and find the most efficient delivery methods.

Source: Pexels

In the second part of this guide, we'll discuss how to know when you need a routing optimization program, and what benefits you can expect from a routing optimization software.