437-886-6089
Logistics and Supply Chain Management: Differences and Challenges
Logistics and supply chain management are standard business terms, and a day does not pass by without them getting mentioned in a business setting. Some experts believe that the two terms are very similar and can be used interchangeably. However, some differ from this belief.These two have been used interchangeably in many countries; for instance, […]
What is Delivery Route Planning?
Struggling to plan efficient delivery routes? You’re not alone. Many business owners find it difficult to create an efficient delivery route that takes into account traffic, time, and distance. That’s where a delivery route planning solution comes in handy. A good delivery route planner can save you time and money while making your business more […]
The majority of package deliveries are done by Couriers and Local Delivery Service companies that route and track deliveries. This industry comprises two segments: larger couriers and smaller local delivery companies. Together, these segments cater to various consumers, with demand for each segment differing based on the services offered. Tracking package deliveries is a crucial task for both segments though. Specifically, downstream demand for courier services stems from manufacturers and retailers across the country, while demand for local delivery services is derived from households and other local markets. Although the markets for each segment differ, demand for each segment tends to fluctuate in line with consumer spending, the number of businesses, and e-commerce sales, all of which have increased over most of the five years to 2020. The U.S. market size, measured by revenue, of the Couriers & Local Delivery Services industry, is $115.7bn in 2020 and it is expected to grow at an average of 5% a year for the next 5 years1.
Routing and tracking package deliveries can be challenging using your own fleet. As a fleet manager, you’ll need sufficient visibility to ensure the efficient running of the delivery process. Nowadays many businesses are relying on technological solutions such as route planning and package delivery tracking software. This innovative technology has revolutionized the way businesses plan, deliver and track deliveries. There are several advanced features of fleet management software and it provides businesses with many insights based on delivery data.
Many types of businesses offer deliveries across a range of industries. There are also more on-demand services and next-day delivery options. More people are relying on deliveries and companies need to offer the most efficient service in order to keep up with competitors. It is designed to help automate and streamline processes and reduce costs. It also enables fleet managers to find new ways to improve customer satisfaction and optimize their delivery service.
Types of package deliveries
There are different types of package deliveries. Companies are competing to provide fast and efficient deliveries, and some of the new services include:
- - On demand
On demand deliveries are those that arrive very quickly, or in a matter of hours. Customers can expect to order something and receive it on the same day, often depending on time restrictions. The global on demand delivery market is on the rise and predicted significant growth in the coming years. - - Next day
Next day delivery arrives the following day, in theory. It’s challenging for many small businesses to manage and there are many cost factors and other issues. A company needs to consider the number of packages and their destinations, plus the number of vehicles and workers needed in order to break even.
Delivery services require quick and detailed route planning, especially the more short notice they are. Route planning and package delivery tracking software can help businesses deliver goods faster. Fleet managers are able to monitor traffic, locate drivers, optimize fuel usage, and improve safety. It also reduces the risk of delivery failure or delays, helping to build a better reputation for the company.
Who is involved
Businesses of all sizes and across many sectors are now offering deliveries. The fulfillment process involves a number of people at different stages. Order fulfillment starts with the receiving of the goods, short-term storage, usually in a distribution center or warehouse, followed by picking and packaging, shipping and tracking of the package deliveries. This process involves different types of workers in order to sort, store, package, and deliver the products.
Many smaller businesses outsource their routing and delivery tracking to a third-party, whereas other larger companies use their own fleet. A fleet manager is in charge of overseeing all deliveries, they hire drivers and vehicles to carry out the process and track the package delivery process real-time.
International couriers vs own fleet deliveries
Certain businesses may also use international couriers. International couriers, such as UPS, FedEX and DHL are third-party organizations which take care of a company’s deliveries, especially to other countries. There are pros and cons of using a courier rather than your own fleet. If you manage your own fleet, you are more in control or your supply chain and transportation operations and can route and track your deliveries more efficiently. The challenge is covering the cost, however, and providing an efficient enough service to keep up with today’s standards.
There is an increasing demand for quicker deliveries at competitive rates. If you choose to manage your own fleet, you need to optimize each stage of the supply chain process. This isn’t only limited to transportation, but also fleet management, vehicle maintenance, and logistics. You also need to recruit, train, and manage drivers.
Over 2.5 million commercially owned fleets are used in the US alone, along with rental trucks and other vehicles. There is clearly the need for state-of-the-art solutions to help private businesses manage their fleets. Fleet planning and tracking tools are becoming more advanced with many automated features. This has made it easier for businesses to plan and track package deliveries using their own fleets rather than working with a third-party courier.
Routing and tracking tools and technologies
New planning and tracking tools allow businesses to monitor their fleets and analyze any relevant data. Comprehensive delivery management software for packages deliveries can cover a number of areas. There are key features such as route planning, GPS tracking, driver hours compliance, route performance and fuel consumption monitoring, and maintenance and safety controls. It also provides useful insights based on the data it collates, enabling businesses to make improvements to their delivery services.
Choosing the best package delivery tracking software for your business depends on your own unique requirements. It’s important to opt for the right tools that are easy to use and that are compatible with other applications you may use for your business. Fleet management software tuned for package deliveries is designed to make your life easier and to save you time and money. Here are some of the main features for you to prioritize for your business.
Next day route planning
There are many benefits of offering next day package delivery. For Ecommerce, it’s a big incentive for customers. Slower delivery options could push customers to use their competitors instead. Packages for next day delivery are sent separately and the routes need detailed planning to ensure they are optimized in such a short timeframe. Less Platform’s route planning algorithms proprietary algorithm help to create the most efficient routes for you by using order specific and external data (traffic conditions, weather etc.). If you’re traveling to multiple destinations it will put these into the most logical order, depending on updated information. This is especially useful for next day delivery when you’re on the clock.
Dynamic route planning
Dynamic route planning and delivery tracking is a fully automated feature that uses data mapping to give you the best routes in seconds. It takes into account live traffic and road conditions and updates all the information in real-time. It’s an effective strategy for fleet management because fleet managers and drivers know that conditions can change. The best route depends on a variety of factors. With dynamic route planning, businesses can also respond better to customers’ requests, for example, a change to the delivery time.
Drivers are informed automatically in real-time and are given updated directions to the new route. The route planning technology is also constant learning and offers drivers the most fuel-efficient and timely delivery options. This allows businesses to better predict departure and arrival times and notify the customer of more accurate timeframes. Dynamic route planning is one of the most important innovations in delivery technology. Delivery automation has been very effective for businesses in many industries.
Live management
One of the most important features in Less Platform’s routing and package delivery tracking software is the live management features. These give fleet managers the information they need in real-time and facilitate communication with drivers. Some live management features include:
- - Operational dashboard
The operational dashboard interface monitors and manages operations. Route planning software is cloud-based, so all users from the fleet manager to the driver can have access to all the information they need, and also share data and communicate. - - Stop trucking
The package delivery tracking and route planning software monitors all truck stops and driver hours and compliance. Advance geofencing functional helps to know exactly when drivers approach or leave the location. It also generates updated ETA’s for every stop, helps drivers to navigate, and notify customers about the arrival. - - Driver communication
Fleet management software includes a driver’s app allowing them to stay in contact with the fleet manager at all times without additional phone calls.
Electronic POD
Electronic proof of delivery (POD) provides complete visibility of delivery operations. Businesses can send accurate consignment details to their fleet drivers and customers. These include waiting times, arrival times, and the exact delivery time. The feature is also customizable and allows delivery drivers to take electronic signatures in some cases. You can configure the electronic POD feature so that your drivers and customers have access to the information they need. You can also automate the sending of PODs.
Reporting and analytics
The great thing about Less Platforms package delivery software is that it provides data insights based on reporting and analytics. It analyzes the efficiency of routes, driver performance, late deliveries and many other aggregated statistics. The fleet manager receives reports on driver performance and can pinpoint any possible causes of accidents and prevent them.
Less Platform also reports load and empty mileage and miles saved. Fuel consumption is a major cost for businesses offering delivery services. Data analytics provide the fleet manager with reports according to each individual driver so they can help reduce driving costs.
There are several key features that allow fleet managers to automate many processes. It enables businesses to streamline their entire fulfillment. These results in improved accuracy of delivery times and increased customer satisfaction. Many types of businesses could benefit from the use of this software to plan and track their own fleet. It’s an effective solution to prevent any setbacks or challenges deliveries and transportation can bring. The latest in Less Platform provides businesses with the insights they need to improve their fulfilment at every stage of the process.
Author
Vardan Markosyan is the CEO at Less® Platform
MBA from the University of Chicago Booth School of Business
PhD in Economics from the Institute of Economy of NAS RA
He spent decades of research and consultancy on business process optimization and system design
Less Than Truckload (LTL) logistics is different from that Full truckload (TL). Thus, Transportation Management Software for LTL carriers should take into consideration these differences. People might think that it is just a size of the load but there are fundamental differences in business models so strategic and operational management tools and methodologies should be used.
Less-Than-Truckload (LTL) model
To understand what is the best Transportation Management Software for LTL carriers, we need to describe LTL logistics. The baseline LTL logistics combines random short-distance pickups and long-distance haulage.
The fundamental difference of LTL logistics is that companies usually organize pickups with city cabs and then consolidate loads in the larger trailers for the long-distance haulage during the week.
In organizing Local pickups two types of operational challenges emerge:
- - How to organize daily local pickups so that available equipment could handle the most of loaded mileage and be balanced, in the meantime assuring the most accurate appointment times?
- - Dynamically rebalance new pickups when loads have already commenced.
Next, pickups usually being consolidated in depots/warehouses in larger equipment/trailers so they can be transported to a longer distance. While timely and safe delivery is a high priority, inefficiencies also arise as planners spent time in assuring the best delivery windows while taking into account available equipment, driver specifications, and a number of other factors. This process is time-consuming, can decrease the accuracy of deliveries, and substantially increase costs of operations by underutilizing existing equipment and increasing total mileage.
And finally, one should make sure the interoperability of both parts of operations, assuring the profitability of the business, in the meantime keeping operational expenses as low as possible. It particularly means the ability to plan both inbound and outbound operations simultaneously and establish the best consolidation or cross-docking model that creates optimized short-haul and long-haul loads.
A simple LTL model with pick-ups and deliveries can look like the one in Figure 1 below.
Figure 1 Less Platform’s multi-stop pickup and delivery sample loads
The route planning system in Transportation Management Software should be able to first plan multi-stop pickups for each day during the week and then consolidated deliveries.
We have presented problems of planning LTL operations in two graphs below:
Figure 2
As you can see, the system should assure high accuracy of both pickups and deliveries, trying to increase the number of orders in the mealtime keeping high equipment utilization and low driven mileage.
Transportation Management Software (TMS) for LTL carriers available on the market
We have implemented quick research to understand how the top firms on the market address these problems of LTL trucking and Transportation Management Software for LTL carriers are available. We have particularly looked at their websites. Some of the top solution providers and their offers are listed below:
Trimble transportation management
Shipment Planning and Execution
Optimize load matching success and customer satisfaction by analyzing load and equipment information such as driver hours (HOS), miles, costs, and availability for both the current load and future scenarios to plan and dispatch loads accurately and easily. Streamline day-to-day load matching so your team can focus on the more complex needs of today’s planning processes. Increase efficiency with load-power optimization planning tools for OTR and multistop scenarios.
Oracle transportation management
Operational Planning
A state-of-the-art optimization engine that automatically finds the best solutions for your logistics needs, while adhering to your business requirements and trading partner capabilities.
Create a more efficient and higher velocity logistics network
Plan and execute domestic and international shipments—in one system
Lower rates and manage equipment more efficiently
Optimize the cubic capacity of containers, consolidate orders, and streamline location flow and calendars
Omnitracs
Reduce Costs and Simplify Operational Processes
Managing any for-hire fleet is a constant battle between doing what’s best for the customer and what’s right for the business. For less-than-truckload (LTL) fleets, however, this balancing act is even more challenging due to the complex nature of the business. Juggling multiple customers, locations, delivery and pickup times, drivers, and vehicles while controlling costs can be an impossible task without the right tools in place. Thankfully, there are solutions built to simplify operations for LTL fleets while delivering improved efficiency and customer value.
SAP transportation management
Order management
Minimize freight costs and enhance customer service. Improve the efficiency of order and process management and generate optimized, rules-based routing proposals dynamically.
MercuryGate
Plan for And Deliver Better Load Building Outcomes
Increase space utilization while cutting freight and fuel costs. Leverage control tower visibility to take the guesswork out of load planning by easily generating precise calculations before shipping. Streamline loading and unloading and minimize labor errors with step-by-step planning.
MercuryGate’s load planning and load building takes into account all facets including weight, dimensions, densities, stackability constraints, and compatibility constraints. This empowers your whole team to significantly reduce the number of freight runs needed, as well as the emission your transportation produces.
JDA transportation management
Transportation
Supply chains are only going to get more complex, yet you are expected to consistently deliver while managing costs. With transportation, you can leverage every available asset, drive profitability, and sharpen your competitive edge. Our solutions enable you to transform your transportation operations by managing both inbound and outbound, integrating supplier and carrier collaboration tools and tackling whatever challenges tomorrow brings.
Almost all of them have planning, dispatch, visibility, 3rd party carrier sourcing, and accounting capabilities for multi-modal business models. Some of them are on the market for decades. All of them have planning capabilities listed on their websites.
Conclusion
Transportation and logistics firms should have robust tools to increase operational efficiency without compromising client service and business goals. LTL planning optimization has limited offerings despite the variety of available TMS and fleet management software on the market. Robust planning toolbox, data interoperability, and visibility through all the business processes could help LTL firms substantially improve their efficiency, make planners and dispatchers' life easier, and equipment utilization better.
We understand that total macro instability, current low level of rates, decreased order numbers on certain lanes and for certain clients, and other factors may substantially affect the appetite of the management to improve the efficiency of operations. On the other hand, now is the time to start thinking more about efficiency and prepare for a better harvest when good times are back.
Less Platform can turn your data into loads within a couple of minutes and compare it with your historical results! You can also test all the necessary features for your logistic model and consult with our experts on your challenges.
Author
Vardan Markosyan is the CEO at Less Platform
MBA from the University of Chicago Booth School of Business
PhD in Economics from the Institute of Economy of NAS RA
He spent decades of research and consultancy on business process optimization and system design