Inflationary increases in grocery and household goods are some of the more noticeable rises hitting stores, and although consumers are just starting to feel it, logistics companies for some time have been grappling with the issues behind some of these price increases.
Prices of ingredients and raw materials have noticeably increased over the last year due to higher wholesale costs, especially in the consumer packaged goods sector. At the same time, transportation costs are also high in part due to elevated fuel prices, making margins tighter for those hauling freight.
“Transportation costs are definitely rising. With fuel prices and the shortage of truck drivers, it’s becoming a more difficult time to ship goods than ever,” Campbell Smith, account executive at PTV Group, said.
While many factors are out of their control, fleets have been able to find more control over their transportation spend using PTV Route Optimizer’s features designed to suit the specific logistical last-mile delivery needs for CPG items. Using the tool, savings of 17% or more are not uncommon, according to the PTV Group website.
Even during times of relative stability, the delivery of consumer packaged goods comes with its own unique set of day-to-day challenges, which have only amplified in recent years with the popularity of e-commerce and rising populations in urban areas.
“We see a lot of challenges with moving certain types of vehicles through certain specific urban regions,” Smith said.
Due to the nature of the goods being transported — like dry, cooled and frozen goods — and their various requirements, route planners have previously spent hours trying to determine what goods can be transported in what trucks. Vehicle types, capacity availability and size and weight attributes all also influence this load and route planning.
These factors, combined with the fact that goods are delivered the final mile through densely populated areas, further complicate the planning process due to legal restrictions, traffic patterns and construction zone considerations. With PTV Route Optimizer, this planning process has never been simpler.
Route planners handle many trucks at once and using PTV Route Optimizer, they can easily assign loads across all of their assets and vehicle types at once and find the best routes while taking these considerations into account.
This means reducing transportation costs by minimizing unnecessary miles along inefficient routes, reducing fuel consumption and vehicle wear and tear, overall adding up to serious savings each year.
At the same time, route optimization allows fleets to execute more orders in the same amount of time, further boosting revenue and freeing up the ability to take on more orders as demand for CPG items and e-commerce goods remains a critical part of consumer spending habits.
Using PTV Route Optimizer, carriers are able to avoid the arduous planning time, freeing up more time to fill with other productive tasks.
“Nothing is theoretical. It’s something very pragmatic. So in the end, it helps to save cost on the one hand and increases the reliability of the services you provide,” Matthias Hormuth, president for product management logistics at PTV Group, said.
PTV Group is soon planning on launching its tracking visibility tools, which will allow drivers to update customers on their estimated time of arrival, furthering relationships with the other side of the supply chain.