Route optimization

Route optimization in freight transportation identifies the best routes to complete pickups and deliveries across multiple destinations. Route planning and optimization are used by transportation service providers that make many stops during a single day—most commonly last-mile delivery services, white-glove service providers and less-than-truckload (LTL) carriers.

Depending on business needs, delivery route optimization can focus on:

• Fastest delivery, fewest stops and fewest miles

• Delivery time windows, driver schedules and traffic or weather conditions

• Vehicle capacity, type and location

Delivery route optimization completed manually may require a review of millions of possibilities—a process route optimization software executes in seconds. Route planning and optimization software rapidly produces the best delivery routes based on diverse parameters.

Transportation route optimization software plans the sequence of stops a delivery driver follows to create routes that more closely align with the organization's goals of reducing costs and improving delivery service. An optimized route plan limits time and fuel consumption while protecting delivery service quality and efficiency.

Advanced delivery route optimization considers internal and external data to continuously manage and update freight transportation routes from origin to destination. As a result, shippers, carriers and logistics service providers (LSPs) can reduce transportation costs and improve service and communications for all customers.

Dynamic route optimization adjusts transportation routes automatically—based on real-time information—to maintain the driver's or the fleet's ability to meet service goals. Street-level optimization adapts routes in real time based on conditions such as mechanical issues, traffic congestion or inclement weather.

An important component of dynamic route optimization is dynamic rerouting: ensuring freight pickups or deliveries are assigned to the best driver. Routes are adjusted and communicated to accommodate changes with minimal impact and limited human intervention.

Route planning and optimization software delivers significant benefits for fleet owners and operators:

• Reduce fuel costs with routes optimized to limit distance, idle time and stops

• Improve the experience for end consumers through real-time estimated time of arrival (ETA) updates

• Increase driver productivity by running optimal routes and avoiding delays

• Eliminate time-consuming manual route planning and dispatcher intervention

Routing technology integrated into a transportation management system (TMS) helps fleet managers:

• Use automation to reduce route planning time from several hours to a few minutes

• Expand services and improve driver productivity

• Respond more quickly to exceptions

Within a shipper's transportation carrier network, route optimization software provides additional management support:

• Streamline workflows and communications with one system of record

• Standardize processes to improve record keeping

• Access deeper performance insights with one normalized data set

A TMS supports route optimization by automating and streamlining exception management from the first mile to the last mile. This includes communicating with stakeholders during any necessary change in route, delivery ETA updates, appointment changes, new deliveries or pickups—all from a centralized platform for shipment data.