How Freight Route Optimisation Saves Time and Cuts Costs for Your Business

Freight and logistics operations are under constant pressure to reduce costs, improve efficiency, and meet customer expectations. This is where route optimisation can be a game-changer for companies that want to stay ahead.

In this article, we’ll take a look at how route optimisation works, how your business can benefit, and how to overcome common challenges you may face.  

How Does Route Optimisation Work?

Route optimisation uses advanced algorithms and real-time data to plan the most efficient delivery routes. It starts by inputting data like delivery addresses, vehicle types, and driver schedules, while considering factors such as traffic, weather, and road closures. 

The system then calculates the best routes, considering distances, fuel efficiency, and vehicle constraints. It adjusts to avoid any disruptions, ensuring efficiency is maintained. 

Over time, route optimisation systems learn from historical data and improve their recommendations to keep enhancing route planning and efficiency.

Common Inefficiencies Before Optimisation 

Before adopting route optimisation, many businesses face inefficiencies that negatively affect their logistics and increase costs. Here are some of the most common issues:

1. Static routing 

Many companies rely on fixed, pre-determined routes based on historical data or standard assumptions. While these routes work under ideal conditions, they aren’t adapted to daily changes in orders, locations, or fleet availability. 

Over time, this leads to unnecessary mileage and fuel consumption.

2. Lack of real-time data

Traditional routing methods rely on basic GPS systems and manual planning that doesn’t account for live traffic, accidents, or road closures.

Without access to real-time data, drivers can face congestion, resulting in delays, missed delivery windows, and increased fuel consumption. 

3. Inefficient stop sequencing 

Determining the most efficient order for multiple stops manually is a significant challenge. Without optimisation tools, planners struggle to find the best sequence, leading to backtracking, unnecessary detours, and wasted time on the road. 

The Impact of Route Optimisation 

On fuel 

Route optimisation can reduce fuel consumption by choosing the most efficient routes based on real-time data. By considering factors like traffic conditions and road gradients, it can help minimise engine idling and stop-and-go driving that wastes fuel. 

On driver hours

Route optimisation helps reduce driver hours by calculating the fastest and most efficient routes, cutting down travel time and enabling drivers to complete deliveries more quickly. It also ensures compliance with driving regulations by distributing workloads more evenly. 

Measuring the ROI of Route Optimisation 

Measuring the ROI of route optimisation involves looking at factors like cost savings and performance improvements. 

Cost metrics include factors like fuel consumption, driver costs, maintenance costs, and cost per delivery to determine your total savings.

Performance metrics include total kilometres driven, time per route, deliveries, and on-time delivery rate to assess your performance. 

Overcoming the Challenges of Route Optimisation

While route optimisation can come with several challenges, they can be managed with the right approach.

Integration difficulties

Integrating a new route optimisation system with existing logistics and IT platforms can be difficult. Partnering with providers that offer easy-to-integrate APIs or platforms helps streamline the process and ensures smooth integration.

Data quality

Doing regular audits and improvements in data collection methods helps ensure that the system has reliable information to generate the best routes. This reduces incomplete or inaccurate data that could limit the effectiveness of optimisation tools.

Implementation costs

While the upfront cost can be a barrier, conducting a cost-benefit analysis to highlight long-term savings can help justify the expense. 

Resistance to change

Employees and managers could be hesitant to adopt new systems. Ensure you provide clear communication about the benefits, training, and support around the integration to reduce resistance.

Stay Ahead with 28East

Route optimisation offers measurable benefits for logistics businesses, helping them address common challenges such as cost reduction and improved fuel efficiency. But it’s important to partner with the right provider to make this transition as easy as possible.

28East offers tailored route optimisation solutions that integrate seamlessly with existing logistics systems, helping businesses operate more efficiently. Reach out to us today to learn more about how we can help.