At the end of every busy retail season comes the drop off in freight volumes. The first quarter of the new year is typically an economic lull not just for freight volumes but also for work in construction and other industries that are serviced by fleets.
Fleet management systems have a number of tools that help companies plan ahead to keep the bottom line from falling during the winter months.
“One of best things a business can do with the data they have, especially those that experience fluctuating job cycles, is to leverage that historical data to have better viewpoints into the future,” says Kevin Aries, head of global product success, Verizon Connect.
Verizon Connect has fleet management platforms for all sizes of fleets. Mobile and back-office routing and planning applications have troves of data that can be analyzed for predicting seasonal trends, he explains.
Besides predicting business volumes, fleets can compare planned versus actual route performance to identify areas of opportunity to increase efficiency. Analyzing historic job locations is another pathway for identifying important trends to determine how to change or adjust routes for the winter season — or any season for that matter.
Will Salter, chief executive of Paragon Software, a provider of fleet route planning and execution software, says that companies are interested in fine-tuning the execution of their routes by knowing where all drivers are at any time against the plan.
“In the past, a transportation office would not know what was going on,” he says. “We are seeing a huge amount of interest in that information flow for keeping an organization informed.”
Taking a deeper dive into worker productivity metrics can also uncover hidden cost savings. How many jobs did drivers complete? How long did they spend on each job? Perhaps time and money could be trimmed out from their workday by shortening transit times or taking out unnecessary time and fuel spent idling.
Solving a year-round problem
Seasonality is a factor for Al Khayyat Investments (AKI Group) in Dubai, but the company didn’t really need to invest in fleet management technology. The company operates in an area of the world with the cheapest fuel and cheapest labor.
“Not a lot of people automate (in the UAE),” he says. With the low cost of resources, “it is tough to justify a payback” by implementing technology, says Gary Grindlay, supply chain director.
AKI Group has a diverse range of business units in retail, consumer, contracting, healthcare and automotive that generate $2 billion annually in sales. The company’s in-house transport operation is responsible for delivering goods across the seven UAE emirates to a wide range of customer locations that include hospitals, pharmacies, shopping malls, retail stores and restaurants.
About one year ago, AKI Group decided to implement a routing system from Paragon Software Systems. By using the cloud-based software, the company is automating the planning and execution of routes for 25,000 orders a month. This equates to approximately 12,500 deliveries to 5,500 customer sites.
The routing software automates a complex routing problem by considering drivers’ hours-of-service restrictions, the vehicle licensing in each emirate, and stocking multiple compartments of vehicles with food, non-food and pharmacy products.
In the past year, the company has been able to reduce its fleet from 94 to 52 vehicles while the number of annual deliveries increased from 110,000 to 140,000, he says. Altogether the company has saved $1 million in direct labor and fuel costs.
For the next phase, the company plans to use features in its Paragon system to notify customers in advance of scheduled deliveries. When a customer receives an alert that a vehicle is 15 minutes away, for example, they will know to plan on when to be ready to merchandize goods on the shelves, which will save its drivers more time during stops, he says.
Besides using routing software to stay on top of business needs, especially during seasonal fluctuations in revenues, the technology can help smooth the transition to the future of electric and alternative vehicle powertrains. Paragon has new modules that fleets are using now to plan routes for vehicles with limited range by accounting for the locations of charging stations and charging times, Salter says.