Company and costs: how route optimizations impact in megacities

When discussing the logistics and transport of goods, it is crucial to consider route optimization, especially when multiple shipments are in megacities.

These last-mile deliveries account for 53% of the cost of transporting goods, making it critical to optimize routes to reduce operating budgets.s.

5 influential factors in route optimization

If you are dispatching a fleet of vehicles in a big city, consider the following factors when planning logistics:

1. Vehicle traffic

A megacity has a myriad of roads, some of which are heavily congested.

By analyzing those traffic flows or predicting them using route optimization software, deliveries can arrive faster by dispatching vehicles on the fastest routes.

2. Time slot

Tied to the traffic factor, avoiding the times when a megacity has the heaviest traffic could make the difference.

For instance, if companies use traffic flow statistics, they could foresee peak hours for bottlenecks between 1-2 pm and 6-8 pm. Then, they can decide whether to send vehicles to alternative routes or avoid those hours.

3. Road width

Narrow streets will impact the delivery speed because a transporting vehicle will not be able to move or easily maneuver.

This is especially important for transportation and logistics planning in megacities with residential areas.

4. Lead time

The time window in which customers will receive their orders is pivotal. Products delivered before or after working hours (9 am to 6 pm) may inconvenience customers.

Satellite tracking and traceability are valuable tools to address this. They determine which route the vehicle will follow They also monitor the package status so customers can track their order minute by minute to avoid unpleasant surprises.

5. Vehicle speed

Besides complying with speed limits, vehicle weight and the fragility of the goods must be taken into account when making estimates.

Those two factors will indicate the proper speed, even if it is slower than other cars in the big city.

Dynamic route planning: its impact on costs

Dynamic route planning uses these factors to plan efficient routes based on data collection.

By alternating factors, this methodology runs simulations until it determines the most optimal routes, resulting in the following benefits:

• Reduced mileage and maintenance. Avoiding inefficient routes saves time and reduces the number of kilometers the vehicle fleet covers, reducing the maintenance frequency.
• Lower fuel costs. An optimized route also reduces fuel consumption, requiring fewer stops and less time stuck in traffic.
• More time for logistics personnel. Automated dynamic route planning leaves routing in the hands of traffic models ,saving employees time and letting them focus on more complex tasks.

Consequently, PTV Group¹ statesthat logistics costs could be 20% lower. Route optimization will lead a company to better performance of assets and while promoting team productivity.

If you are ready to improve your company’s logistics and warehousing, it’s time to contact us. At Advance Real Estate, we are experts in leasing industrial buildings at strategic locations.

Information source

1. company.ptvgroup.com/fileadmin/…/ptv_libro_blanco_que_es_la_optimizacion_de_rutas.pdf
2. thelogisticsworld.com/transporte/el-presente-y-el-futuro-de-la-optimizacion-del-ruteo
3. thelogisticsworld.com/transporte/tecnologia-para-optimizacion-de-rutas-logra-mayor-eficiencia-y-nivel-de-servicio-en-tus-entregas
4. thelogisticsworld.com/actualidad-logistica/trazabilidad-en-la-logistica-fundamental-para-el

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Advance Real Estate

Advance is a leading company in the acquisition, leasing and operation of industrial and logistics assets, with presence in 12 cities within Mexico and a portfolio of 11.5 million sf of industrial space.

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