On the Route Track
June 1, 2007
On the Route Track
By Elizabeth Fuhrman
Routing software and hardware make containing costs viable
Stop by any time,” family and friends often chime, but most wholesalers would be shocked if customers operated that way. The old cliché applies: Time is money. The distribution business is competitive, but add to that employee expenses, transportation costs and customer satisfaction, and time management becomes essential to efficient operations.
Routing technology is one solution for wholesalers. It allows distributors to be more competitive in the marketplace by eliminating the amount of guesswork involved in setting up routes.
“There are a 37 trillion ways to route five vehicles making 10 stops a day,” explains Cyndi Brandt, marketing manager at UPS Logistics Technologies, Towson, Md. “It is impossible for the human mind to determine the best route. Allowing the software’s algorithm to define the most intelligent plan eliminates the chance for excess mileage. Less mileage equals less money spent on fuel and less money spent on driver overtime. Providing customers with current information regarding deliveries increases customer satisfaction levels and encourages repeat business.”
Some of the biggest problems beverage distributors face include reducing the amount of excess mileage driven, driver overtime and the overall lack of control regarding the order-to-delivery process. “Incorporating a routing software program can put a significant amount of money back into the wholesalers’ profit bank,” Brandt says. “Customer service can provide real-time delivery information to customers, which allows for a happier customer.”
Creating customer time windows is another feature of routing software that raises customer satisfaction. Routing software should take a customer’s delivery time preference into consideration. TruckStops by MicroAnalytics Inc., Arlington, Va., is one such example.
“By taking the time window into consideration and by meeting that time window, you are keeping the store owner happy,” says Dan Buttarazzi, director of marketing for the company. “Now he knows when to expect you, and it doesn’t throw his whole day off.”
Keeping an efficient schedule and following a precise route also reduces the environmental impact that a company makes. “You are cutting down on the gas use and on the truck emission,” Buttarazzi says. “A lot of companies are taking that into consideration now because they want to do everything they can to minimize environmental damage.”
Distributors can further contain costs by automating route reconciliation and reducing office labor, says Patrick Pilz, chief executive officer of CSB-System International Inc., San Diego. Companies also can accelerate cash flow by faster invoicing and cash collection.
“With a good route planning module in conjunction with actual data tracking, it is common that companies can reduce mileage driven by 5 to 10 percent,” Pilz says. “Overtime and stop times can be reduced significantly as well, but to make this really work, you need more connectivity to the truck so that you can capture actuals, such as start and stop times of the engine, open and close times of doors, etc. These are the data you need to analyze to see where the driver kills important time and costs.”
Some routing systems can increase efficiency and effectiveness throughout the warehouse, sales and distribution processes. Software from Raleigh, N.C.-based Intervolve Inc. provides the ability to drag and drop orders into other trucks to maximize truck capacity and take trucks off the street, says Sandy Smith, marketing director for the company. Intervolve’s Web and mobile software provides anytime access to information and the ability to save time tracking calls, providing sales data and recording street-level execution at each account.
Routing solutions also make it easier to gather and analyze data as well as create actionable objectives. “Wholesalers can simultaneously zero in on efficiency opportunities and provide valuable market intelligence at retail,” Smith adds.
A wholesaler must define its needs when looking at purchasing new or upgrading routing hardware and software. “Sit down and analyze what you are trying to accomplish so you can talk intelligently with different vendors and compare their products based on your needs,” says Warren Johnson, senior IT manager and product manager for dedicated and mobile technology at Ryder Systems Inc., Miami. “If not, you could be making a bad decision.”
Also, the bigger a distribution business is, the more difficult it gets to find an optimum solution. From number of vehicles, products, drivers and clients, and the size of the distribution area, the larger the scalability the more effective a routing software package would be, Johnson says.
To optimize routing and scheduling, the best method of receiving orders would be electronically so they can easily interface with routing software, he says.
“If you have linkage between the order entry system and the routing package, then you can do routing dynamically and that would be preferred because that means in every instance you’d be able to do the route with the least amount of equipment and miles to satisfy those demands,” Johnson says. “Out of the routing and scheduling system, you might then download those routed orders in terms of loads to a transportation management system, which might provide them to an onboard computer or a handheld device from an item-level tracking standpoint. Then as the driver would make the deliveries, if he had the handheld device, he could scan the product and guarantee that he had been meeting what had been downloaded. In other words, it would help reduce overs and shorts for customers.”
Wholesalers should consider multiple issues when purchasing a handheld system, Brandt says.
“Functionality is a priority,” she explains. “What do they need the device to do? Measure driver productivity, prevent service failures, provide driver location information? Are they most concerned with accessing real-time information in order to make the route plan better?”
For hardware, distributors also must decide how far the solution needs to go and how mobile the solution needs to be, Pilz says.
“Some payback can come from integration into the truck systems, which would, of course, be more costly,” he explains.
Other things to consider are shelf-life and ruggedness of the equipment, he says. “Before getting into the process, the wholesaler needs to clearly understand where the potential savings can come from, what environment he operates, what customer structure he has, before he can start shopping for the right solution.”
bMobile Technology, Eagle, Idaho, offers a new version of Route Manager software that provides computer systems with mobile invoicing, presales order gathering and full route management. The system is designed to integrate with the office accounting system and eliminates the need for redundant data entry and can streamline the sales process. Barcode scanning, signature capture, load sheets and inventory control are some of the ways the system helps with routing.
Intervolve’s solutions support a variety of handheld devices. “Often, the best device differs by user scenario,” Smith says. “For example, salespeople can use full-screen tablets, laptops or Palm or PocketPC devices, depending on their portability needs and the need to synchronize with the warehouse. With WiFi capability, these devices can sync from any location. With small, portable printers, a salesperson could print orders at the customer site or in the vehicle, whichever is more convenient and efficient. Small form-factor wireless printers can save a significant amount of time by providing immediate print-outs without having to go back outside to the vehicle.”
Another aspect to consider is whether the routing software program integrates with GPS tracking software. A GPS device can be placed in a bed of a truck to pinpoint where the truck is at all times. In addition, routing software programs can be uploaded into the GPS unit. If the driver has a computer onboard, this allows the driver to punch in where he is supposed to be for the day, what he is delivering and how much he is delivering. On the other side, the headquarters location can know if the driver is in his cab, where the driver is along his route, the reason a driver could be running late, road conditions he is experiencing, and speeds driven along the way.
“The systems are so advanced they can even tell the braking conditions,” Buttarazzi says. “Is he hitting the brakes too hard? Or how long was he in first gear, when he should have been shifting to second?”
Ease of use
Distribution companies can motivate drivers, delivery personnel and salespeople on the benefits of routing software and hardware by allowing them to be involved in the entire process.
“Provide the staff with information on how this solution will allow greater success for the organization, and in turn, benefit employees,” Brandt says. “Explain how the different tools will be useful in relation to each employee’s position.”