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8 What-If Questions Software Should Help You Answer

Automating truck routing by implementing routing and scheduling software will bring immediate efficiency to day-to-day routing, but the technology is also an excellent tool to aid decision-making on some critical business questions.

It allows you to play out any number of what-if scenarios and measure the impact of proposed changes without actually having to execute them. This opens up exciting opportunities for reforming and improving your delivery operations with minimal risk, saving you time and money.

Here are eight what-if questions your routing and scheduling software should help you answer.

1. What if I changed my delivery routes?

There are so many variables involved in delivery operations, it’s hard to figure out what the actual end result will be if you change one or more of them. Manual planning requires a human brain to do highly complex math in order to work out all the possibilities. By contrast, routing and scheduling software deploys sophisticated, road-tested algorithms that crunch any number of variables in the blink of an eye.

With this software, you can explore changes in the number of drops per driver, or the impact of switching delivery days from six days to five, for example. For most, there’s a need to balance costs with service, and to respond to demands from other key stakeholders in the supply chain, such as sales and manufacturing. Routing and scheduling software quickly and easily facilitates this.

Most people find playing forward the consequences of these sorts of changes just too hard to do without the aid of a specialized computer program. Companies that still route manually generally have to execute new route scenarios, then wait for feedback from the driver. With routing and scheduling software, you can run new routes in a theoretical model before you make decisions about changes.

Automated planning also takes a lot less time than manual planning, so fleet managers not only have the ability to easily perform these modeling exercises and play with many more scenarios, they have the time to do it, too.

2. What if I changed the size or type of trucks in my fleet?

Customer demands are changing. In many industries they are moving towards smaller, more frequent deliveries. Maximizing efficiency in fleet operations means, among other things, minimizing the number of trucks driving around with empty space. Routing and scheduling software can show you what your delivery operations would look like if you chose to replace existing trucks with smaller or larger ones.

By the same token, the software can play forward what-if scenarios about the type of trucks you operate – for example larger rear-steer vehicles that can get into smaller spaces than non rear-steer trucks of the same size, or specialist small trucks that only work for tight, inner-city locations. It can even take account of the qualifications of your individual drivers, to make sure you’re calculating the availability of drivers with skills to operate these specialized vehicles.

3. What if I moved my order cut-off times?

Customers are demanding increasingly shorter delivery lead-times, which means later order cut-off deadlines.

A request to shorten order cut-off times might come from the sales team, or your warehouse. Routing and scheduling software can help you play this scenario forward and respond quickly to these requests from other divisions so that you can collaboratively determine if this is the right thing to do.

Or you can see the impact of opting to load product immediately after picking, necessitating a delivery night-shift, with all the implications for arranging driver shifts while keeping within Hours of Service restrictions.

The software allows you to feed in information about all customer order requirements and habits, and come up with a smart plan that serves all of them in the most efficient way.

4. What if we opened a new store or customer drop point? 

Often, decisions that profoundly affect delivery operations are taken elsewhere in the business without much consideration of what the impact will be down the operational chain.

A classic example is when a company opens a new store, say, in an inner-city location that’s a nightmare to reach by truck. The commercial team will typically look at the local market, potential sales and expected profit before deciding to open a store, without taking account of the costs of actually supplying that store. The same goes for taking on new business, or serving an existing customer in a new location.

With routing and scheduling software, you can arrive at an accurate cost-to-serve estimate, and enter into a sensible conversation with other departments before it opens. This means the transportation department can contribute to overall business strategy – which may be a whole new thing!

5. What if I moved my distribution center(s), or opened a new one?

The distance between your DCs and your customers is not just about miles; it’s about time. Serving your customers best may mean reducing the amount of time between receiving an order and being able to deliver by moving DCs closer to customers. If you are unable to reach parts of your territory within an overnight trip, that means no next-day service. Increasingly, this can be a problem.

By contrast, it may be that there’s no need to be within 24 hours of customer locations, and allowing for a two-day delivery schedule opens up opportunities to move DC operations to a cheaper or more convenient location.

Routing and scheduling software can crunch even an incredibly complex pattern of customer locations and determine what the ideal location for DCs could be, in light of customer demands. Here’s a great example of UK food-to-go firm, Greggs, using this technology to figure out how to consolidate their DC locations into a single one to better serve customers, while saving time and miles.

6. What if I needed to merge two delivery fleet operations?

Many companies find they need to turn to their routing and scheduling software as part of due diligence when considering expanding by buying other companies. These acquired companies will inevitably have their own, pre-existing delivery routes which would now need to be incorporated into the parent company’s operations. Delivery vehicles often end up crisscrossing needlessly, or doubling up on one region when the resources could be better deployed in another. Routing and scheduling software helps figure out what the real extra burden would be on delivery resources.

Rather than having separate depots and fleets all trying to serve a whole region, the software identifies synergies and opportunities to best deploy assets. That’s a massive piece of work most companies would find impossible to do manually.

The software is designed to allow you to view all customer locations, DCs and individual idiosyncrasies so the newly combined operational picture makes great, efficient sense.

7. What if we won a new contract?

Winning new business is great for every company…as long as it’s profitable. If your business development team can’t work out the cost to serve a new account, or fulfil more deliveries for an existing customer, new business could actually be bad for your business.

For example, grocery distributor A.F. Blakemore, which services SPAR supermarkets and convenience stores in the UK, uses Paragon’s software to quickly and easily assess the impact of the introduction of any additional SPAR locations. Because the modeling is able to help Blakemore Logistics to understand the potential costs to serve each store and the related impact on locations nearby, it can calculate the cost of taking on more work before agreeing the charges.

8. What will be the return on investment (ROI)?

If you’re considering buying a new piece of accounting software, it’s easy to get an idea of what it will cost you, but hard to get actual figures on the savings it will deliver. By contrast, you can expect to get figures on what implementing routing and scheduling software will save you, and over what time – unusual in the world of software.

You will be able to see the changes in cost of labor and equipment, as well as the efficiencies gained in driver-miles and time, as well as assets needed. At even a very basic level, your software provider should be able to show you what savings you will gain immediately and over time. Comparing this to the cost of the software will give you a remarkably reliable estimate on improvements and time to ROI.

What-if questions are important

Fleet routing is not just about calculating routes from point A to point B. To meet customer service requirements, better utilize assets and lower costs, planners need to consider many variables, and combinations of those variables, required to execute shipments.

Routing and scheduling software allows you to proactively explore a huge number of options – configuring them to whatever constraints you wish — before committing to anything. It means strategic review can become part of your daily fleet management operations, continually boosting efficiency.

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