Tactical Transportation Planning and Backhaul Optimization
By: SupplyChainBrain August 21, 2014
Solutions that allow users to tactically plan transportation routes and optimize backhauls enable significant efficiencies, says Sara Curtis, principal consultant at Peak 5. She explains how Peak 5 works with clients to implement and leverage these applications.
Vehicle route optimization programs are a marked improvement over past systems that generally were limited to looking at simple trips from a DC to one store and back to the DC, says Curtis.
Programs like LLamasoft’s Transportation Guru enable users to plan multi-stop routes so they can hit all stores in a defined area on the same trip, she says. Backhaul optimization is an additional capability that leverages workflows that occur repeatedly on a daily or weekly basis. “The use of Transportation Guru to optimize backhauls has been very successful at creating savings for our customers,” Curtis says.
Some of Peak 5’s customers have taken this capability outside the four walls to find backhaul opportunities with their suppliers, she says. “A lot of time inbound transportation and outbound transportation are handled by different groups, but with backhaul optimization you can figure out how to deliver to retail stores on the outbound and on the way back pick up shipments from suppliers to replenish the DC. This saves miles and dollars and benefits both sides.”
The great thing about the LLamasoft suite of solutions is the integration between supply chain design and transportation design, says Curtis. “Integrating these two capabilities gives users an opportunity to do network design and transportation design collaboratively and simultaneously,” she says. “You get better results with fewer assumptions. This makes users feel more confident in the plans and recommendations that they take forward to management.”
Integrating the different mathematics behind network design and transportation design into a single framework and interface represents a great step forward, Curtis says. “I think the next great step will be to solve the problems of where to locate facilities and optimize transportation at the same time.”