By: G. Ray Gompf, CD
While most small business owner operator truckers sit down to plan ahead, they still think about getting the load to its consigned destination along the simplest, most direct route that will allow for the best fuel economy, avoid traffic as much as possible and get the load delivered on time. In addition, there’s the hope that there’s a load back with the fewest empty miles and producing a decent per mile rate while bearing in mind there is no such thing as a back haul. That’s not what is being discussed with strategic route planning.
I used the “pick-a-lane” method where I’d pick a destination that provided a decent per mile rate by averaging the amount potentially earned by the round trip. I didn’t need to go beyond that for potential earnings – I just did it.
From my starting point in Eastern Ontario, the best paying loads where in Florida to supply the food chain in eastern and southern Ontario and the greater Montreal area. I had a reefer and hauling produce was easy. My lane could produce 3,000 miles a week with only one major pull between North Carolina and Virginia, and then in Pennsylvania, some hills that never needed too much downshifting. And only one necessary rest stop each way. Oh yes. Knowing my exact costs and knowing where my lower point was to support my profit line. That was my planning. It worked for my operation.
So, I looked up the definition of strategic route planning. My methods didn’t stray too far from the definition below, but I didn’t use the flowery language to describe my strategic route planning.
“Strategic route planning is the long-term, high-level process of designing a transportation and resource network to achieve a company’s financial and customer service goals. It focuses on establishing fundamental policies and a “blueprint” for a company’s delivery operations over months or even years, rather than optimizing a single day’s schedule.”
And then the definition opens up to more explanation. I guess my pick a lane strategy worked after all.
“Strategic vs. Daily Route Planning:
Strategic route planning is distinct from daily, or operational, route planning, though the two are interconnected.
- Strategic planning: Involves modeling “what-if” scenarios to determine the optimal fleet size, location of distribution centres, and overall delivery strategy based on factors like customer demand, vehicle types, and operating practices.
- Daily planning: Focuses on executing the day-to-day schedule within the framework established by the strategic plan.
“Key Aspects of Strategic Route Planning:
- Optimal resource deployment: It determines the best combination and location of assets, including distribution centers, fleet size, and drivers, to efficiently meet customer demands.
- Performance modeling: Using technology, companies can simulate changes to their distribution network to evaluate the financial and operational impact before making potentially costly decisions.
- Adapting to market shifts: The process helps businesses understand the costs and capacity needed to enter new markets, handle seasonal fluctuations, or consolidate assets after an acquisition.
- Foundation for daily operations: It establishes the core routes and policies that daily routing software can then use to make dynamic, real-time adjustments for factors like traffic, last-minute orders, or vehicle availability.
“Core Benefits for Businesses:
- Enhanced efficiency: Optimized strategic routes reduce empty miles, fuel consumption, and vehicle wear-and-tear by creating more effective delivery schedules.
- Significant cost savings: By improving efficiency and minimizing transportation costs, businesses can lower their overall operational expenses.
- Improved customer service: Consistent and reliable service, driven by efficient route plans, leads to better on-time performance and higher customer satisfaction.
- Optimized resource allocation: It ensures that fleet and personnel resources are used to their full potential, maximizing productivity.
The problem of dealing with definitions is that while it explains in detail, the words used are anything but colloquial and leave as much confusion as it provides answers. I’ll leave this definition portion for you to see. English is my first and only language and I only think I understand it.
