Vehicle Routing Problem: What, Why and How to manage?

Written by Kingsuk Bhowmik on Apr 18, 2022

Any business that involves fleet and product delivery, is familiar with the intricacies and hurdles of the Vehicle Routing Problem. It has been present in many different forms for many years—for example, The Traveling Salesman problem dating back to the 1800s. Vehicle routing can be considered as a problem of finding an optimal path for a vehicle between two or more points. The problem has applications in transportation, logistics, and others. In this article, we will discuss the vehicle routing problem in detail, with an emphasis on its important properties and recent advances. In short, what is a vehicle routing problem, why does it happen and how to solve it.

What is the Vehicle Routing Problem?

One of the most crucial matters for distributing or manufacturing businesses to complete their orders properly is to make sure the product safely reaches its destination. And it is equally important to optimize the routes to be cost-effective and complete the deliveries on time. But it’s not just one destination where products get delivered per day. As a result, the route optimization needs to be done taking multiple stops, traffic signals, distances of one-stop from the other and a few more things into account. And this is when vehicle routing problems arise. Now, one can think it is easy to optimize routes for each delivery manually. However, with multiple stops, optimizing and picking out the best route which covers all the stops in a circular manner, is very tough. For example if you have 10 different stops to cover in one ride by one vehicle, the roundtrip can have more than 300,000 permutations and combinations to pick out the most cost and time effective option from. It is safe to say that it is almost impossible to get it manually done. Some examples of the VRP that occurs on a daily basis are;

  • Delivery Mans who deliver packages to multiple destinations each day.
  • Distribution businesses that needs to restock products in multiple locations.
  • Food catering services availed by multiple events or offices.

And a lot more. To achieve the goal of cost-effectiveness and time efficiency and reduce driving time of your fleet, the only wise solution for this Vehicle routing problem is opting for the right route optimization software for your company.

The intricacies of VRP

Even though it might just sound like regular route optimization, there is much more to the problem to deal with in order to get the right solution. There are many different factors that play big parts in the problem, and it is important to understand all of them in order to solve it correctly and understand the role of software.

  1. Logical sequence of the stops: When route optimization involves multiple stops, it is important to organize the routes in a circular manner. By which the vehicle can travel back to the depot while covering all the stops it possibly can in one trip. There are two factors that contribute to this. One is optimizing by time, this means choosing the route that will occupy the shortest time while delivering. And the other one is optimizing by the distance. Which is making sure the optimized route has the shortest distance while covering the stops in order. Both are done taking things into account like traffic congestion, unexpected roadblocks, properly spacious roads for the vehicle in route and of course distance from one stop to another. All of which can only be done by automated software within a matter of minutes.
  2. Computational support for unpredictable factors: Amongst all the factors that have an input in solving VRP, few factors like customer requirements, sudden traffic jams and unpredictable road blocks cannot be taken care of ahead of time. For that, real-time data optimization is crucial to ensure customer satisfaction and also fleet performance. Using advanced algorithms allows you to get real-time data support to avoid these scenarios.
  3. Eliminate unnecessary delays: To avoid paying for the added costs of unplanned stops and unnecessary diversions which occurs due to manual dependency on urgent situations,the need of an integrated and automated vehicle routing system is unavoidable.

All of these and a few more recurring issues can play a big part in making vehicle routing problems a big hindrance in the way of your company’s growth if the right measures are not taken in due time. And as suggested, the most rational and effective measure towards eradicating this problem is choosing the right software for your company. Nuport’s route optimization software might just be what you need.

Nuport Route Optimization software

Nuport’s route optimization software can support your businesses and accelerate growth by solving vehicle routing problems by providing the best solutions. It doesn’t only include recommending the best-optimized route for your multi-stop delivery process but also provides,

  1. Superior geocoding capabilities: With the help of geocoding facilities, your fleet will never lose time or money getting caught in the confusion of wrong or clumsy addresses. This improves delivery planning and reduces the chances of delayed deliveries and keeps the fleet on time.
  2. Real-time tracking: This allows stakeholders to stay updated on all the delivery statuses in real-time and also unpredictable matters. It also helps provide customers with accurate ETAs and helps enhance customer experience by meeting their expectations.
  3. Proof of delivery: Speeds up payments cycles and adds a layer of security in transactions.

Automatic re-routing capabilities: As traffic congestions and unexpected roadblocks do not always come with a warning, the auto re-routing feature by picking the next most optimized route helps drivers to avoid lagging behind and meet daily goals.

All of the above are the services you can avail for your business and solve vehicle routing problems, only through opting for Nuport’s route optimization software. Schedule your free demo today!