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Route Optimisation for Retail Merchandisers

In the last few blogs I have been writing about route optimisation for retail delivery vehicles, using a furniture shop as an example of how to to achieve significant return on investment. Of course the principles apply to commercial travellers.

Take the example of a retail merchandiser. There are hundreds of people travelling around the country daily visiting supermarkets, dairies, pharmacies, liquor stores and pretty much every type of retail store. A large percentage of these people have a mix of urban and rural stores in their sales territory that they visit on cycles. Some of them are regular cycles that they repeat periodically, others may be more ad hoc.

Typically retail merchandisers change jobs or territories fairly often, which means that they will not be familiar with where their clients are, or what the best order is to visit them in. They are often under a lot of pressure to make as many visits in a day or on a trip as possible.

Route2GO is the perfect tool for these people and their Managers. Just like the retail delivery people in the last blogs, there are many factors that determine Return On Investment.

The first and most obvious one is travel distance and time. The obvious one is to look at a day’s calls, calculating the best order to do the visits in, putting in the start location which could be the office, warehouse or even the person’s home and then the end location. If it is local and just a day trip, it is going to be pretty easy to calculate the order. This will provide travel time and distance. It could also include driving directions.

If it is a longer trip which includes overnight stays, you could look at the entire trip as if it was on one day to optimise the entire trip and then cut it into chunks for each day. One of the things that is often difficult for a traveller is estimating the travel times. Barring traffic accidents, congestion etc, we can provide a very good estimate of travel time. The traffic information itself we also provide by way of the Roadwatch and AA Maps websites. For $1.95 you can also subscribe to real time traffic alerts which you can receive by SMS or email for a 4-day trip at AA Traffic. This would give you some advance warning if there are any real issues. For example over the last couple of months, many highways including State Highway 1 have had road closures due to slips and floods. Being forewarned means that you can plan ahead.

Now that you know the travel time from one retailer to the next, you can start to do some planning. In merchandising their are obviously a variety of types of call. Some are easy to plan because it is simply shelf management and the merchandiser will know which products are ranged and have an idea of how much time a call will take. In some cases they don’t even need to see the manager. By doing a spreadsheet similar to the one in this blog, you can get a pretty good idea of what you can achieve.

Obviously where there is actual selling going on, or even getting orders signed, there can be extra delays, waiting to see the buyer and time on site will vary. This comes down to experience.

As per previous examples, the immediate tangible ROI is that Route2GO can tell you the best order to make the visits in and advise you of time and distance. This can save you tie and money and we invite you to contact us and send us a couple of trips in the order they were done in and we can optimise them and return them to you so you can see the order we would recommend and what the savings would be. There is no cost or obligation to you for this evaluation.

The next obvious benefit is establishing whether, with the time saved, you can either make more calls in a day or maximise the time spent on the calls to find ways to generate more revenue. Perhaps managing shelf facings, recommending new products or doing product knowledge training. We all know that if you don’t manage your shelf facings, they can shrink as your competitors products squeeze them out. Another issue is out of stocks. In today’s economy many retailers manage their inventory on a Just In Time basis. That means that if you do not meet your call cycle, you could have a situation where you are not only missing out of sales, but the out of stock situation could be introducing the retailers’ customers to your competitors alternatives.

Optimising and planning your trips, especially out of the city means that you can also do some advance planning, making appointments with buyers, with a reasonable degree of certainty as to when they can expect you. This is of course a professional way of doing business that will help your customer relationships and give you a competitive advantage. Lets face it, everyone is extra busy these days and the easier you are to do business with, the more likely you are to get an unfair share of the shelf space.

Probably the best part of Route2GO is that it is really easy to use. You don’t need a specialist, just the ability to create a list, with addresses of the customers you intend to visit. There is no up front cost, you pay as you go, which means that it pays for itself from day one. Why not give it a try for your next trip?

October 5, 2010 Posted by | AA Maps, AA Traffic, Delivery, driving, driving directions, Freight, Furniture Delivery, geosmart, location based services, map tools, maps, Marketing, new zealand, new zealand maps, petrol, Retail Profit, Return On Delivery, ROI, route optimisation, Route2GO, Sales, software, Uncategorized, Web Map, web maps | , , , , , , , , , , , , , , , , , , , , , , , | Leave a comment

Route Optimisation for Retail Deliveries Return On Investment Part Two

In my previous blog I talked about the immediate dollar benefits of reordering your retail furniture deliveries so that you would drive the least distance, saving both time and money. I gave examples of actual returns using GeoSmart’s Route2GO Lite application which is designed for anyone to use. In other words, you don’t need to be a computer geek to be able to use it. You need to understand your business.

I gave the example of getting up to 1200% ROI on a single run and this is genuinely achievable. But there are so many more benefits to be had. Lets have a look at some of these.

First if you combine the knowledge of how long it is going to take to get from the shop or warehouse to each customer, you will be able to work out how much work the vehicle can do in the trip or in a day. This has a number of benefits. Firstly it provides clarity for sales people and the sales counter of what deliveries can be achieved in a day. Imagine if a customer came into your shop wanting to buy a bedroom suite as they have guests coming in the weekend. If you can’t guarantee delivery, your store loses the sale. That being the case, the sales person loses commission, your competitor gets your sale and the would be customer will be telling people not to visit your store, even if you have great product for a great price.

In the optimised example below, we have identified not only the driving time for each job, but based on experience, how long the driver would typically be on site unloading the truck and carrying the product into the customer’s home or premises. This is of course very important when planning the entire day.

The next thing that is really important for consumers is some sort of certainty as to when the truck will arrive with their treasured new purchase. They want the experience to be gratifying and they don’t want to be waiting around in the morning for someone who isn’t going to arrive in the afternoon.

Now you can actually provide some clarity. you wouldn’t of course tell Mrs Smith that her new bed will arrive at 9:43 AM, but it would be fair to say it should arrive between 9:30 and 10:30 or perhaps 11AM allowing you to under promise and over deliver. She may have had to take time off from work to be home for the delivery. We always hear complaints about delivery people who don’t turn up when promised and the flush of excitement can quickly turn into anger and frustration.

Deliver as promised and you don’t just have a happy customer today, you have a customer advocate who will be back at your store next time she is open to buy furniture and will be recommending you to her friends. People don’t buy furniture every day, but they may do so dozens of times during the lifetime of your business. There are loads of stories showing that people favour service ahead of price, so these repeat customers will also possibly be very profitable customers who will haggle less and make a decision more quickly because they like and trust your business.

Of course the delivery people will be much happier too. Who wants to deliver to a customer who is telling them off for not arriving on time. They are just doing their job, probably what they have been told to do. They don’t need to have their day soured by unnecessarily unhappy customers.

Because we know the order we are going to do the deliveries in, we can also produce a document that tells us how to load the truck in reverse order.

Lets face it, furniture is heavy and it makes a lot of sense to handle each item once onto the truck and once getting it off. There’s no benefit in having to move things around every time the truck stops, its inefficient, hard work and wastes time.

A list like this makes life easy for the truck driver and also for the warehouse staff, ensuring that all items get on the truck in the correct order. All it actually is, is the delivery list in reverse order. That’s what this is ultimately what this is about. It’s not rocket science, yet we do need a computer to work out the optimisation because the driver doesn’t know every one way street, no right turn, median strips where the truck can’t do a U-turn.

So now we have paid a few dollars to use this application on the web. We can see that we have enough resource to do some more deliveries if we get some more sales, which will inspire confidence in the sales staff. You get happy loyal customers who will come back and spend more with you and tell their friends to do the same. You can provide a better service than your competitors and your staff will be happy in their work knowing that their day will be less complicated and they will have happy customers.

The best part is you don’t have to take our word for it. Give us a few of your old runs in the order that you did them in and we will optimise them for you for free to prove our point. No cost, no risk, no obligation. You have nothing to lose and everything to gain. Why not contact us now?

October 1, 2010 Posted by | Delivery, driving, Freight, Furniture Delivery, geosmart, location based services, map tools, maps, Marketing, new zealand, Retail Profit, Return On Delivery, ROI, route optimisation, Route2GO, Sales, Uncategorized | , , , , , , , , , , , , , , , , , , , , , , , , , , | Leave a comment