Route Optimization Example

There are many ways to get from point A to point B. You can take the route with the shortest distance or the fastest time. You can use different modes of transportation like a bike, car, or train. You can even use a boat or a plane to transport people or goods from one place to another. But no matter what you choose, there’s always a best way to get there – and that’s where route optimization factors into the equation.

Route optimization can help logistics businesses transform their operations into well-run, efficient machines with the best routes possible. That means drivers making more stops, more savings on expenses like fuel, and more satisfied customers thanks to timely deliveries or service calls. Route optimization can deliver huge wins for small and large businesses, and that’s why we’re going to show you exactly how to do it today. 

To skip to a section that’s most relevant to you, click one of the links below:

• What Are 5 Major Benefits of Optimizing Transportation Route Scheduling?
• What Is a VRP Model?
• How Do You Optimize a Route?
• How Is Route Optimization Done?

What Are 5 Major Benefits of Optimizing Transportation Route Scheduling?

Most businesses are always interested in improving customer service, decreasing operational costs, and maximizing profits. Route optimization can unlock many different benefits, but here are five main benefits of route optimization:

1. Increased efficiency. Optimizing transportation route scheduling allows companies to improve the efficiency of their fleet operations and streamline their business processes overall. This is especially beneficial for logistics organizations making frequent deliveries or field service calls, such as parcel delivery or repair services. By optimizing routes, companies reduce the time and resources spent on transportation and make better use of their vehicles, drivers, and other assets.
2. Reduced costs. When transportation routes are optimized, businesses can reduce costs by minimizing delays, reducing missed deliveries, and eliminating other inefficiencies that occur with unoptimized transportation routes. This helps maximize productivity, limit needless manpower expenses, and reduce vehicle maintenance and fuel consumption expenses.
3. Improved customer service. Optimized transportation routes allow businesses to meet customer demands effectively by providing timely and reliable delivery of their products or services. It also enables companies to seamlessly integrate live customer notifications and feedback requests into their business model. This increases customer satisfaction and retention rates, which is essential for any successful organization in today’s competitive marketplace.
4. Enhanced reputation. By providing excellent customer service through optimized transport routes, organizations can cultivate positive reputations with vendors and customers as reliable providers of goods or services delivered on time and without incident. Maintaining a solid reputation is invaluable for earning more business and producing higher revenue.
5. Greater logistical flexibility. A final benefit of utilizing systematic route optimization processes is it enables businesses to remain nimble in the face of challenges that can come up at any given moment. Real time fleet visibility means businesses can adapt quickly and better manage logistical needs across their operations. For example, if someone calls in sick, a truck breaks down, or unforeseen road work delays a driver, real-time fleet routing software allows the fleet manager to reroute other drivers as needed and give customers an up-to-the-minute ETA.

What Is a VRP Model?

The vehicle routing problem (VRP) is a combinatorial route optimization problem that involves determining the optimal route for vehicles to deliver goods or services to multiple destinations. In layman’s terms, it’s the challenge of finding the best possible routes for multiple drivers visiting a set of locations. If you’re only dealing with one driver or vehicle, it would be more accurately defined as the traveling salesman problem (TSP).

There has been more than a single route optimization research paper or two written about the VRP for a reason. It’s particularly challenging because it involves many variables and constraints and non-linear relationships between different variables. The VRP route optimization model attempts to formalize this complex problem in mathematical terms and create an algorithm that delivers an effective solution.

Several approaches to solving the VRP model include various algorithmic route optimization techniques, such as heuristic simulations and meta-heuristics, and more advanced mathematical methods like machine learning and artificial intelligence.

Regardless of the specific method used, the ultimate goal of the VRP model remains the same: to find efficient routes that balance speed, costs, service quality, and other important considerations.

How Do You Optimize a Route?

There isn’t necessarily a single set of criteria that can be used to optimize every route in the same way; instead, various factors must be considered based on the specific situation.

Factors commonly considered when optimizing a route include distance, mileage traveled, traffic conditions, and potential roadblocks along the way. Naturally, these factors vary from one situation to another, so it is important to utilize route planning software that tailors your approach depending on the specific need.

Here are some of the primary criteria you should consider when optimizing a route:

• Total stops and route particulars
• Real time traffic consideration
• Driver management
• Order-vehicle constraints
• Live geolocation data
• Time constraints
• Historical data

Since every organization is different and the “best” option will likely vary depending on the route and the goal, each scenario should be analyzed individually while considering all these important criteria.

Can Google Maps Optimize a Route?

Google Maps is an effective route planner if you don’t need to make more than ten stops, but it does not automatically optimize routes. Route optimization software free of any cost that effectively solves all of the criteria we’ve discussed is hard to find.

That said, you can manually optimize your routes using Google Maps and the criteria we’ve discussed, but Google route optimization done in this way can be time-consuming and labor-intensive as you try to keep all of those criteria in mind while laying out your stops. You might need to hire a full-time route planner to go this route! And remember, you can only include up to ten stops total with Google Maps. 

How Is Route Optimization Done?

Unless you’re using route optimization software with automated planning, an optimal route isn’t something you can typically create in a few minutes. Considering all of the criteria we’ve already laid out that business operators should keep in mind, it can be time-consuming to optimize your routes manually. It’s possible, but many professional logistics operations use software to do the heavy lifting for them.

Here’s how you can use some of the criteria we’ve laid out to create an optimal route:

Total stops and route particulars

The cornerstone of any route is how many stops must be made and where each stop is located. Once you have a full list of stops, you can start determining their sequential order, any stop particulars that may require a specific vehicle or driver, and build a route that incorporates the other criteria as well. 

In terms of stop particulars, keep in mind factors like:

• Best or nearest driver to dispatch to the route
• Traffic congestion for the current time of day
• Left-hand turns (crossing the line of traffic)
• Number of turns or intersections on the route
• The best approach (access) to a stop on the route

Real time traffic consideration

It’s no secret that traffic can be a major headache for drivers and cost them time on the road. The last thing anyone wants is for their delivery route to be further complicated by gridlock and congestion. That’s why it’s important to consider real-time traffic conditions when optimizing your routes.

If you’re using an outdated map or street directory, you might not be aware of the changes that have taken place since it was published. New construction, lane closures, and other obstacles can easily throw a wrench into the best-laid plans if not accounted for.

That’s why it’s essential to use routing software if you want the most up-to-date traffic information. By considering current traffic conditions, you can avoid unpleasant surprises and ensure your drivers are always taking the most efficient routes possible.

Driver management

Managing drivers effectively isn’t easy and only gets more complicated as your workforce grows. In terms of route optimization, you need to be mindful of each driver’s:

• Schedule
• Breaks
• Geographical locations
• Skill sets (e.g., driver’s license that allows them to drive transport trucks vs. just cargo vans)

You’ll likely also want to be able to balance the workload among drivers as desired, e.g., plan routes so each driver gets roughly the same amount of stops in the interest of fairness or balance it so that more cost-effective drivers do more while more expensive options like contractors are utilized less.

Order-vehicle constraints

When planning a route, it’s important to consider specific order details that may require particular vehicles in your fleet. For example, if you operate a general delivery business, you might deliver everything from food to heavy equipment. Therefore, you might need to tailor the vehicles you use per route based on things like refrigeration ability, size and weight capacity, or whether or not the vehicle has a ramp. These constraints could affect which vehicles are used for certain stops.

The same factor exists for field service companies regarding vehicle requirements and driver skills. For example, some employees might have certain certifications or skill sets that enable them to complete jobs that others can’t, like a particular driver’s license for large vehicles or a technical certification for handling certain tools. These factors will need to be considered and accounted for when you’re optimizing a route.

Live geolocation data

No one likes being in the dark, but it’s more than just a preference; it’s a matter of efficiency for fleet managers to know where each driver and vehicle are at any given time. Collecting live geolocation data on your vehicles empowers logistics operations to stay plugged into their routes, manage unexpected issues, and keep customers in the loop. It also allows you to optimize on the fly with real time route modifications. 

Time constraints

Similar to order-vehicle constraints, time constraints can add an extra layer of complication to a route. For example, if you’re a delivery or field service company, then there’s a good chance you may need to make stops within specific time frames, e.g., during the lunch hour, in a specific time window when a customer is home, etc. All of these time constraints need to be factored into a route plan and optimized for by allocated drivers appropriately. 

Historical data

Information is power, and the more information you have about your routes, the better you’ll be able to optimize them. That’s why large and small logistics operations should consider using route optimization software that allows users to collect data, analyze performance, and make informed decisions about how to optimize their operations based on historical data.

How is route optimization implemented?

Now that you know the important criteria to consider when optimizing a route, how do you actually implement route optimization into your workflow? The particulars will vary based on the software you use, but generally speaking, here’s a step-by-step  route optimization example you can implement:

1. Create an optimized route plan

Build a route plan using the criteria discussed previously. Import or list all of your stops and order them logically based on location, route and destination, particulars, time constraints, vehicle-order requirements, and traffic considerations. 

2. Assign drivers

Once you have your route(s) assembled, assign the driver(s) who will be working them. Remember to factor in driver availability, break times, stop times, and particular skill sets that might be needed for certain stops. 

3. Manage issues in real time

Track your drivers in real time, if possible, and manage for unexpected delays, changes, etc. Advise customers of any delays that may occur. 

4. Analyze the data and reevaluate

Once the route has been completed, dig into any available data you have to determine what went well and what could’ve gone better. These are factors you can consider the next time the route is completed. 

Route optimization doesn’t have to be complicated, especially if you use specialized software like OptimoRoute that handles all of the heavy lifting for you. It takes less time than you think to get up and running with a new route optimization software, and you’ll likely notice a change in the efficiency of your operation right away.  

If you’re interested in learning more, check out this detailed route optimization blueprint.