Blog > Last mile delivery
Blog > Last mile delivery
20 June 2023 | 7 min read
You manage a goods delivery or transport company. Or you regularly use the services of transport companies to deliver to your shops and customers.
Fuel prices have stabilised. But the inflation rate is still very high. The vehicle maintenance and repair costs are rising faster than the prices charged by the principals. It is becoming increasingly difficult to find delivery drivers and to retain them. Your employees or service providers are asking you to pay them more to offset these costs. And now there are the added constraints of low-carbon transport. It’s a vicious circle!
However, there is a way of limiting your goods transport costs and your need for vehicles and workforce: it’s by optimising your deliveries. And much of this can be done with the help of software and its algorithms.
In this article, we look at:
Optimising means offering the best possible conditions of use, operation, and performance. This means increasing your profitability, but also improving the organisation and efficiency of your deliveries.
According to the Comité National Routier, which is a technical body whose mission is to observe the operating methods of road transport markets, the drivers’ wages (and expenses), fuel and maintenance costs account for around 70% of road transport costs. The remaining 30% relates to structural and equipment costs.
Like many freight forwarders or transport companies, your number one priority is certainly to reduce your operating costs.
But it’s difficult to cut costs without compromising customer and employee satisfaction. If your vehicles are older or not properly maintained, you run the risk of regular breakdowns, longer downtimes and, ultimately, additional costs and delivery delays. And saving on your drivers’ wages won’t help you retain them.
Switching to electric vehicles is not easy either, as purchase prices are still high and infrastructure is limited.
You still have 4 other ways of optimising your deliveries and reducing your costs.
💡 Improving the efficiency of your routes will therefore help you both to reduce your costs and to improve the satisfaction of your customers and your drivers.
You’ve certainly tried to optimise all these factors yourself and improve the organisation of your deliveries. But you’ve probably come up against a major limit: the amount of data you need to manage in order to optimise routes, schedules and vehicle capacity.
That’s where digital technology comes in, offering you relevant ways of optimising operations that are very difficult to do manually.
It’s always possible to create simplified itineraries using an Excel spreadsheet and navigation tools like Google Maps or Waze.
But we’re not always aware of the invaluable help that business digital tools can provide. To help you do just that, we’ve listed the main features of software tools dedicated to optimising freight transport.
The first optimisation stage is rarely the responsibility of the carriers. It takes place before the delivery process, in the distribution centres or supplier warehouses. It involves sorting, placing on pallets and sequencing orders in the best possible order.
More and more companies are using automated package sorting, processing and palletising systems to speed up these logistics operations. This eliminates manual steps, reduces processing errors, speeds up the flow of parcels through distribution centres, and allows transport vehicles to be loaded in the right order. At this stage, customer data goes from databases (ERP) to warehouse management software (WMS) to transport software (TMS).
The next step is to place the goods in the transport vehicles, to optimise the space available and reduce the number of vehicles required. Here again, software can be a great help. Using advanced algorithms, some software automatically calculates the best possible layout, based on the sequencing order provided, the size of the packages and the storage space available.
💡 This means more parcels delivered by a single vehicle, and therefore less fuel consumed and CO2 emissions.
To optimise your deliveries, the most important thing is to reduce the number of miles travelled. So it’s essential to optimise your delivery routes.
Among the many data related to deliveries are:
Imagine software that can organise all this data, so that with just a few clicks you can create route planning and an optimised route sheet tailored to each driver.
That’s what route optimisation software offers.
They can also be linked to a navigation app, giving you real-time access to traffic conditions.
They can then:
💡 It’s an invaluable tool for avoiding traffic jams, reducing delays, continuously optimising your routes and improving both your profitability and customer satisfaction.
The GPS tracking systems included in route optimisation software also allow you to track your parcels in real time. You can identify the location of your vehicles and packages at any time. This means you can detect potential problems, such as delays or routing errors, and take corrective action quickly.
By setting up an automated notification system, your customers can also be kept informed of important details concerning the delivery of their goods:
This keeps them informed about the progress of their deliveries and enables them to be better prepared. This helps to increase the success rate of first-time deliveries.
💡 Some applications go even further, giving customers the option of postponing the delivery date or re-routing the delivery to a drop-off point if they are absent. These are all “no shows” that can be avoided.
Reducing CO2 and fine-particle emissions is becoming essential for all transport companies. The aim is to help protect our planet and reduce health risks, as well as meeting new regulations and the growing demands of consumers and principals.
By identifying and tracking your sources of emissions, you can measure your carbon footprint at every key stage of your deliveries:
But it’s not always easy to make these calculations. Some route optimisation software can help, by indicating in your route plans the emission rate of different routes, depending on the delivery method and location chosen. This will enable you to select the least costly or least polluting route, which often go hand in hand.
By now, you’re thinking that these optimisation algorithms and software solutions may be very interesting, but they must also be very expensive.
Well, there are some very affordable apps out there that offer feature packs tailored to your needs and the size of your business.
AntsRoute software, for example, is available from €24 per month per vehicle.
It won’t let you optimise packaging or automatically sort products in a distribution centre.
It does, however, give you access to many route optimisation functions:
👨💻 By investing in dedicated software such as AntsRoute, you can benefit from the power of its optimisation algorithms. All you have to do is enter your constraints and objectives into an Excel spreadsheet or Google Sheet. And that’s it!
If you’re interested in this software, a free trial is available on request.