Fuel costs may have dropped off since their high levels in 2008, but the transport industry is in a permanent mode of fuel-cost consciousness — and that means every unnecessary mile now represents money wasted.

At the same time, businesses, now more than ever are streamlining operations and relying on just-in-time delivery to cut back on wasted resources.

The combination of the two trends means it is crucial for jan/san distributors to hit their delivery marks perfectly, and that has prompted growing interest in the use of routing software.

Many of today’s leading routing software products are based on Global Positioning Satellite (GPS) technology, which uses satellite positioning to track a vehicle’s whereabouts and send back reports of its location to a central station. Such reports may come as frequently as one per second.

The addition of GPS to otherwise static routing software allows embedded maps to be updated on a constant, real-time basis, and allows real-time monitoring of drivers while en route to their location. GPS can also add automated loggers, which record trip information that can be downloaded.

Benefits

Acme Paper & Supply Co., a Savage, Md.-based distributor, implemented its first routing software system in the early 1980s.

“At that time, however many trucks we would have, we’d have each of the drivers come in and sit down for half an hour or longer just to lay out the stops for that day,” says Ron Attman, the company’s vice president. “The stops weren’t always best for the customer or the company. It was laid out according to what was best for the driver.”

But, with the introduction of software, Acme Paper was able to plan shorter, less circuitous routes, providing more accurate deliveries to clients.

“We’re able to give our customers much better service and meet their time windows,” says Attman.

Instead of spending time poring over maps, drivers can design routes in a fraction of the time with software. At H.T. Berry Co., the company’s two-day delivery window was cut in half after the introduction of routing software.

“We probably took what used to take maybe three hours of somebody trying to figure out the routes down to about an hour,” says Chuck Sheputa, controller for the Canton, Mass.-based distributor. “The benefit to the customer is that it’s giving them faster delivery.”

Not only is less time spent in the office planning routes, but less time is also spent on the road. Drivers can make all their stops without having to log overtime hours.

“If we save an hour in overtime per truck every day, that is a substantial savings alone,” says Attman.

At Milford, Conn.-based Eastern Bag & Paper Co., the company’s routing software resulted in a 50 percent reduction in route planning time and a 15 percent reduction in driver overtime in the first year it was implemented, says Antonio Brown, corporate transportation manager.

Besides routes being planned efficiently, trucks can be loaded in a more economical way. Stops can be planned according to load size, helping to achieve more deliveries in a single truckload without frequent trips back to the warehouse, says Attman.

“We’ve been able to do a good job as far as managing our costs out there, just making sure that the routes are loaded efficiently and the stops are laid out efficiently,” he adds. “We have really good control of what our costs are.”

Cost savings, while important, are just the start. With routing software, there should be no excuses for late deliveries. Drivers can now be held accountable for their actions.

“We know where the driver is in real time and you know when they can be expected at this stop and what time they’re expected to hit our door,” says Attman. “If they don’t hit it at that time, they have to explain it to us, and there is really no getting around it.”

Routing software also improves customer service as distributors are able to keep customers in the loop on deliveries. For instance, when a problem is noticed on a route such as a driver encountering heavy traffic or delays, distributors can take the initiative to call the customer and let him or her know that the delivery will be late.

Investment

Adding any software to operations comes at a great expense — one reason some distributors are hesitant to use it.

Ed Hildreth, co-owner of Tumwater, Wash.-based Sound Janitorial Supply, has not yet implemented routing software because he isn’t sure he can recoup his investment with a fleet of only three trucks. When the size of his fleet reaches four or five trucks, however, Hildreth believes he will have reached a tipping point at which the investment will pay off.

“Given the increasing costs of deliveries, it’s something that really needs to be looked at,” Hildreth says. “The two main issues would be driver time — if efficient routing would reduce time between deliveries it would be extremely beneficial — and then, of course, you look at overall mileage and fuel.”

Sound Janitorial, like many other distributors, delivers directly to customers’ storage areas. Delivery represents a significant percentage of the company’s overall costs, and because gas prices have fluctuated in the past two years, delivery costs have risen considerably. As a result Hildreth is actively seeking ways to reign in these costs and start saving money.

“I guess another benefit would be the mileage you’d put on the trucks,” Hildreth says. “You would reduce that mileage as a side benefit, and the life of that vehicle is going to be longer. You have to stagger when you’re going to replace them, and any extension of that would be truly beneficial.”

While GPS systems are popular and perform well, they can also be expensive, and not every jan/san distributor finds that it is necessary to use routing software with GPS built in.

H.T. Berry Co. has used the same non-GPS system for the past 10 years, and while it has upgraded the system several times, the company has not yet integrated the software with GPS and has no short-term plans to do so.

“We have GPS phones in our trucks, but it’s a different program and it’s not tied into the routing software at all,” says Sheputa. “The GPS system that would tie into our routing software is too expensive. It’s thousands of dollars. The phones we have in our trucks right now are $30 a month per truck. When I told the routing software company what we were paying for that, they just bowed right out.”

Implementation

Getting the full benefits of a routing software system starts with a smooth implementation, and Attman warns that the complications of a large organization can complicate that effort.

“The bigger you are, the harder the implementation process is,” he says. “We were fortunate that we started implementing this back in the early and mid-1980s. We were a lot smaller then, and as far as all the information and inputting it into the system — getting all the time windows from customers and getting all that information into the system — it was laborious then, but if we had to do it now, with all the vehicles we’re running, it would be a daunting task to say the least.”

Eastern Bag’s implementation and continued operation has required strong internal communication and coordination.

“The whole functionality has to obviously communicate with our system,” says Brown. “We were using a warehouse management system and our order entry system, so it took some coordination on that end, and then the rollout of the training for all three of our facilities.”

Implementation of Eastern Bag’s server-based system involved some scheduling challenges, juggling the needs and availability of various users.

As effective as routing software can be, however, Attman says a system is only as good as the company’s ability to use the information it provides to improve its operations.

“You have to monitor the system,” he adds. “It’s one thing to have the data out there, but unless somebody’s seeing it, there’s no sense having it. If you expect the driver to arrive in 8.5 hours and he’s coming in 10 hours, and you’re not looking into the reasons — which are right there on paper for you — there’s no sense spending the money on the system.”

Dan Calabrese is a freelance writer based in Wyoming, Mich.




POSTED ON: 9/4/2009