You have 1000 delivery addresses and 10 drivers, how do you split up these addresses among the drivers so that each driver will travel the best optimal route?
Let’s say for 100 addresses and 10 drivers, there are already a novemvigintillion combinations for you to choose. It’s a huge number with 90 zeros, which would probably take you months to go over all these possible options, and pick the best possible routes. Mathematically speaking, it’s a really huge problem for humans to solve.
Traditionally, delivery and distribution companies plan out all these routes by hand. This last-mile delivery problem is typical for retail distributors in consumer goods, FMCG, postal services, e-commerce, food and beverage, or logistics companies. Everyday, a dispatcher spends some few hours at the office trying to split up addresses among the trucks and bikes. He/she needs to keep an eye on the map constantly to divide the delivery areas and determine delivery route for each driver. In reality, it’s even tougher for the dispatcher as he/she needs not only to consider the roads, but also to think about a certain time window of the stores, traffic situation, flexible lunch break time, fleets’ load capacity, or even small alleys where only bikes can go through, among many other constraints. Minor tweaks in a truck/bike delivery route can save or waste huge amounts of fuel and travel time.
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Facing these problems, global companies invested hundreds of millions of dollars over a decade to build algorithms to calculate the best routes. To stand out from the crowd, delivery companies must offer more innovative delivery services, reduce operation costs and manage fleets more efficiently. That’s why Route Optimization Software Solutions like Abivin vRoute needs to come in. vRoute’s algorithm crunches all data, considers multiple parameters, and helps save 40% of all logistics costs and resources. Automating dispatching tasks allows managers to focus on more essential tasks such as team management, and customer services improvement.
Last-mile delivery is claimed to be a less efficient leg of the supply chain, which accounts for 28% of total costs to move goods. Embracing last-mile delivery optimization software will reduce transportation costs, and increase delivery capacities. So the answer to the opening question “how do you split up 1000 addresses among 10 drivers?” should also go together with a mindset to innovate traditional business operations for the better. As highlighted in Supply Chain Digital Magazine (November, 2016), it has become mainstream that Asian companies invest more and more in innovation for supply chain management, and digitize the end-to-end operations. That is going to change the whole supply chain industry for the better one empowered by technology.