James Taylor, Managing Director at ANC’s drive to implement route optimisation software was to increase profitability for drivers. But the benefits realised were far greater than he anticipated.
Last-mile delivery is one of biggest challenges in logistics. Retailers, logistics providers and solutions providers are investing significant resources into conquering the final part of the logistics operation – the critical last-mile.
E-commerce has exasperated the complexity of last-mile delivery. What used to be trucks making deliveries to a retail store or depot is now individual consumers receiving parcels at home or at work, sometimes on a daily basis.
The Pitney Bowes Parcel Shipping Index found that Australians receive an average of 34 parcels a year, with total parcel volume in Australia growing from eight percent to 841 million parcels, up from 778 million in 2016.
For ANC, one of Australia’s home delivery and corporate fleet services, reducing congestion and emissions and ensuring that the delivery is as efficient and as smooth as possible is crucial, James Tayler, Managing Director at ANC says.
“There’s so much congestion already on our roads – anyway that we can get trucks off the road is a win for the community,” James says. While recently attending a conference in Philadelphia, James recalls a discussion around the issue no longer just about being able to make the journey to the delivery point, but about the availability of kerb side space to stop and safely unload when the vehicle arrives at the delivery point.
For James, being able to route more efficiently and save fuel costs, reduce emissions, reduce driver time and free up congestion on the road could only be a good thing.
“What started as an efficiency plan, has enabled us to achieve a number of different benefits,” James says.
James knew that if he wanted to improve efficiency at ANC he had to better optimise the organisations route planning. “The first part of this journey for us was efficiency of our valueable resource – the drivers,” he says.
James wanted to enable ANC’s contractors to improve their profitability by becoming more efficient. The ultimate aim was to drive less kilometres, work less hours and achieve a higher density of work, he says.
ANC went to market for a route optimisation provider, and PTV RouteOptimiser was selected. “They were certainly the best that we had seen,” James says.
The ANC model uses contractors to make its deliveries, all drivers have their own vehicles. One area in particular that the drivers were not planning or driving as efficiently as possible was by making the common misconception that driving around the traffic was a good idea.
“Driving 20 minutes further is very tempting for drivers, but it is not as efficient as actually sitting in a traffic jam. By driving further, you burn more fuel and often waste more time than just waiting for the traffic to clear,” James says.
The PTV software ensures that drivers take the optimum route when on a consignment. “For our drivers, the software is a great tool. The drivers don’t always have the latest geographical experience in metropolitan areas. Their job is hard enough, now they don’t have to worry about trying to work out the most effective way to get to a location,” James says.
ANC’s contractors have seen significant benefits since the implementation of the PTV platform. “It has taken out a fundamental but important part of the job for our drivers and allows them to concentrate on customer service,” he says.
Much of ANC’s clients are retailers of large and bulky goods, so an important part of their job can be entering the home with the delivery and in some cases, installing the product. By taking out the complication of the driver having to plan their route, the drivers are now able to concentrate more on the delivery experience itself and providing the best service to the customers.
Delivering large and bulky goods through contractors has another layer of complexity. “We have drivers with different vehicle capacities but this was no problem for the PTV software. All variables are mapped out and put into the system,” James says.
In addition, the software will calculate a different delivery time slot depending on the type of goods that will be delivered. If there is an installation involved, it will allocate more time, James says.
ANC implemented the PTV offering almost two years ago, and from early on in the implementation the team found the platform both intuitive and easy to navigate.
“Implementation wasn’t tricky at all. Of course, with all new IT systems there is a learning curve but it was quite simple with PTV,” Lucy MacMillan, National Systems Integration Manager at ANC says.
Before implementing PTV, there was a lot more people working on route planning, Lucy says. “We’ve reallocated a couple of shifts since implementing PTV but at the same time we are doing a lot more work,” she says.
One area that ANC has been able to improve is in consistency for their big brand retailer clients. “We are doing a higher volume of work and our clients are reporting less issues,” Lucy says.
ANC has been able to be much more accurate with delivery times, Lucy says. “One of the most impressive things is that we have been able to be much more specific with our delivery window. The night before we can tell a customer a two-hour window that we will be delivering in,” she says.
Prior to PTV there was a lot of manual intervention, James says. “From a map full of dots the allocator would determine the best route. But now with this tool and the historical data we have, we can see what time we will be at what address and what time we will be completing the job, with greater accurately,” he says.
“We integrate our Transport Management System (TMS) consignments into the software and it filters through all kinds of complex data. It geocodes each address and provides our drivers with the most efficient route possible. This was the most cumbersome part of the routing process” James says.
As e-commerce and omni-channel retailers have grown significantly over the past couple of years, the implementation couldn’t have come at a better time for ANC. “All of our clients are growing in their own right – ANC has had solid growth every year. This routing tool make ANC more efficient and allows the drivers to be more profitable. These are key to both our growth trajectory and that of our clients,” James says.
“The whole idea behind working with PTV was to look at our delivery teams and work out how we can make them more money, but it’s delivered other benefits including better customer service, less kilometres driven therefore less fuel emissions, less vehicles on the road and less fatigue for our drivers,” James says.