Commercial trucks on a highway

What is Route Optimization? Understanding the Technology and Its Benefits

For a commercial transportation fleet, time is money and route optimization is critical to maximizing efficiency and profitability.

When you want to optimize your fleet’s efficiency, route optimization is a must. The right route optimization strategy can elevate your route planning to save your fleet time and your business money. By leveraging the power of technology and data analysis, you can streamline your routes, reduce fuel costs, and improve overall operational efficiency. 

Of course, not all route optimization technology is created equal. Learn more about commercial truck route optimization, explore the benefits, best practices, and tools available to help you take your business to the next level. Whether you’re a fleet owner, logistics manager, or driver, optimizing your truck routes through technology is a game-changer.

What is Route Optimization?

Getting your goods to their destination quickly and cost-effectively is essential in today’s fast-paced business environment. That’s where commercial truck route optimization comes in. Route optimization is the process of finding the most efficient way to travel between multiple points while taking into account various constraints, such as time, distance, cost, stop sequencing and highway/road availability. In other words, it is the art and science of planning and optimizing a journey that involves multiple stops, also known as a multi-stop route or a trip.

Route optimization is a vital aspect of many industries, including transportation, logistics, delivery, and field service management. With the rise of e-commerce, last-mile delivery, and on-demand services, the need for efficient and optimized routes has become more critical than ever. Businesses that can optimize their routes can improve their operational efficiency, reduce costs, enhance customer satisfaction, and gain a competitive advantage.

There are several factors to consider when optimizing a route. These factors include:

  • Distance: The total distance of the journey and between stops should be minimized as much as possible to save time, fuel, and vehicle wear and tear.
  • Time: The time required to complete the trip should be minimized to improve productivity, reduce labor costs, reduce driver fatigue and meet customer expectations.
  • Cost: The cost of the trip, including fuel, labor, and vehicle maintenance, should be minimized to improve profitability and competitiveness.
  • Capacity: The capacity of the vehicle should be maximized to ensure that the number of stops per trip are maximized and all the stops can be completed in a single trip.
  • Availability: The availability of resources, such as drivers, vehicles, and goods, should be taken into account to ensure that the driver is HOS compliant and the route is feasible and realistic.

Route Planning vs Route Optimization

Route planning and route optimization are two key components of logistics management that are often used interchangeably. However, there are significant differences between the two concepts, and understanding these differences is essential for efficient and effective transportation management.

Route planning refers to the process of determining the most efficient path between two or more locations. This process involves analyzing factors such as distance, time, cost, and available resources, in order to identify the best possible route. Route planning may involve selecting the most direct route, the route with the fewest tolls or the route with the least amount of traffic, depending on the specific needs of the transportation operation.

Route optimization, on the other hand, involves improving the efficiency of an existing transportation operation. This process aims to minimize costs, reduce travel time, and improve the overall performance of a transportation system by identifying and eliminating inefficiencies. Route optimization typically involves the use of advanced algorithms and software tools to analyze and optimize transportation routes based on factors such as traffic patterns, vehicle capacities, and delivery schedules.

While route planning is a necessary component of any transportation operation, route optimization can significantly improve the efficiency and effectiveness of overall supply chain systems. By identifying and eliminating inefficiencies, route optimization can help reduce transportation costs, improve delivery times, and enhance overall customer satisfaction.

What are Route Planning Methods? 

To optimize a route, various methods and tools can be used. Some of these methods include:

  • Manual planning: This involves using a map and a pencil to plan the route and estimate the distance and time required. This method is not ideal considering the amount of technology available to fleet owners but can be suitable for small-scale operations with a limited number of stops.
  • Web and application based planning: The use of websites like mapquest, google maps, and applications like Waze offers satellite imagery, aerial photography, street maps, 360° interactive panoramic views of streets, real-time traffic conditions, and multi-stop route planning.
  • Spreadsheet-based planning: This involves using a spreadsheet software, such as Excel, to input the stops, distances, and time estimates and then using formulas to calculate the optimal route. This method may be used in conjunction with fleet management technology for medium-scale operations with a few dozen stops.
  • Optimization software: This involves using specialized software, such as route optimization software or fleet management software, to automatically generate the optimal route based on various constraints and criteria. This method is suitable for large-scale operations with hundreds or thousands of stops.

What is Route Optimization Technology?

One example of route optimization technology is a transportation management system (TMS). A TMS is a software application that helps transportation companies plan and optimize their delivery routes. TMS uses algorithms and optimization techniques to identify the most efficient routes based on factors such as delivery locations, shipment sizes, delivery windows, traffic patterns, and carrier availability.

TMS also provides live supply chain™ visibility into delivery operations, enabling companies to track the progress of their shipments and make adjustments to their routes as needed. This helps transportation companies reduce transportation costs, improve delivery times, and increase customer satisfaction.

Another example of route optimization technology is GPS-enabled routing software, which uses live data to optimize delivery routes based on traffic conditions, road closures, and other factors. This technology is often integrated into a robust ELD (electronic logging device) solution. Transportation companies using GPS-enabled ELDs can adapt their routes on-the-fly to avoid traffic congestion, accidents, and other obstacles, ensuring that shipments arrive at their destinations on time.

Overall, route optimization technology helps transportation companies streamline their operations and improve their bottom line by reducing transportation costs and improving the efficiency of their delivery routes. 

What are the benefits of integrating ELD and Route Optimization Software?

Integrating an electronic logging device (ELD) with route optimization can provide several benefits for fleet management, including:

Increased Efficiency:

By integrating ELD GPS technology with route optimization software, managers can ensure that drivers take the most efficient and shortest route to reach their destination. This can help reduce fuel costs, improve delivery times, and increase overall efficiency.

Better Compliance:

ELDs are designed to help drivers comply with Hours of Service (HOS) regulations. When combined with route optimization, managers can create routes that ensure drivers have enough time to complete their routes while remaining compliant with HOS regulations.

Improved Safety:

Route optimization can help reduce driver fatigue, which is a major cause of accidents. By planning efficient routes that minimize drive time and maximize rest periods, drivers can be more alert and focused on the road, which can improve overall  safety.

Enhanced Visibility:

With ELD and route optimization integration, managers can get live supply chain visibility into their fleet’s operations. This can help them track driver performance, monitor vehicle utilization, and make more informed decisions about their operations.

Reduced Costs:

Optimizing routes can help reduce fuel costs, vehicle wear and tear, and overtime expenses. By using ELD data to optimize routes, managers can reduce unnecessary mileage, idle time, and other inefficiencies, which can ultimately lead to cost savings.

What are the Benefits of Route Optimization? 

Route optimization has several benefits, both for businesses and consumers. As many carriers worry about a freight recession, implementing a route optimization initiative will bring many money saving benefits.  Some of these benefits include:

  • Reduced costs: Optimized routes can reduce fuel consumption, labor costs, and vehicle wear and tear, resulting in significant cost savings for businesses.
  • Improved productivity: Optimized routes can improve the productivity and efficiency of drivers and field workers, resulting in more stops completed per day and higher customer satisfaction.
  • Faster delivery: Optimized routes can reduce the time required to complete a journey, resulting in faster delivery times and improved customer satisfaction.
  • Lower emissions: Optimized routes can reduce the carbon footprint of a business by minimizing fuel consumption and reducing the number of vehicles requiring creating more green logistics solutions. 

What is the best Route Optimization Software? 

There are several route optimization software available in the market, and the best one for you will depend on your specific needs and requirements. The best route optimization software for you will depend on your specific needs, budget, and industry. Ideally, carriers and fleet professionals should look for a TPaaS (transportation platform as a service) solution to optimize and improve fleet efficiency in all aspects of fleet operations. It’s best to evaluate multiple options and choose the best fleet solution and route optimization software that aligns best with your needs. 

Features to Look for in a Route Optimization Solution

There are several key features to look for when you are evaluating a route optimization solution. Typically, fleets who have integrated solutions (ELDs, fleet management, dash cameras, asset tracking, digital load execution, etc) see increased efficiency and lower costs across fleet operations. With an integrated ELD and route optimization software, live supply chain visibility gives fleet owners or administrators a live look at the driver’s route. Back office staff can manage routes for trucks, buses, delivery vehicles, and more. Instead of manually calling drivers to see where they are, the Konexial dashboard lets you instantly track vehicle location, route progress, and late or missed stops. Geo-intelligent ELDs and asset trackers can notify shippers and carriers of departures, arrivals or delays. Automatic geo alerts upon arrival and departures can reduce the amount of calls to drivers which improves the driver and customer experience. Geo intelligence also allows fleets to track delays at pickup and delivery for detention charge purposes.

What’s Next?

Route optimization is a crucial aspect of many industries, and it can provide significant benefits for businesses and consumers alike. With the help of modern technology and advanced algorithms, businesses can optimize their routes to improve their operational efficiency, reduce costs, enhance customer satisfaction, and gain a competitive advantage. Whether it’s an over the road truck, a field service vehicle, or a taxi, optimizing the route can make the journey faster, cheaper, and more sustainable.

Looking for a fleet solution? Contact us today!

Konexial provides superb technology to the transportation industry through the PaaS (platform as a service) model featuring fleet management, video, and safety management, asset tracking, fuel savings programs, and more.

3214 Tazewell Pike Suite 101 Knoxville, TN 37918

865-888-MY20 (6920)

contact@konexial.com