Grocery Delivery Logistics: How to Optimize

Logistics plays a key role in grocery store delivery. No matter whether you transport dry goods from a distribution center to your customers' doorsteps or deliver fresh produce directly from the farms to the tables, success depends on three aspects of grocery delivery logistics: planning, routing, and scheduling. If you want your grocery deliveries to be successful and efficient, you need to optimize your logistics.

Your goal is to cut down on mileage, make routing more efficient to increase on-time delivery rates, improve customer service without hiring an army of support staff, and ultimately increase profits. The challenge is to find the right approach to optimizing your logistics. 

The Benefits of Optimizing Grocery Delivery Logistics

The purpose of optimization is to improve a process, a system, or a set of tasks in order to achieve a goal. If you own a grocery or food delivery business, this means improving logistics to increase profits. In other words, it's how you achieve higher revenue and profitability, no matter how big or small your business is.

Below are some of the benefits companies can gain when they optimize their delivery logistics:

• Reduction of mileage – Optimized routes are those using the least amount of mileage, meaning they’re the most cost-effective way of ensuring the fastest delivery of potentially perishable goods.
• Time savings – As scheduling, planning, and other processes are optimized, they should take less time to complete—time that you can spend on more value-additive tasks
• Improved customer experience – Faster routes and less time spent on route planning result in shorter turnaround times for your customers, leading to a more positive customer experience. As you incorporate visibility and customer communications into the delivery optimization process, the customer experience gets even better. 
• Scalability – Optimizing your delivery processes enables you to handle more deliveries and reinvest more in the business.
• Adaptability – Optimization assists businesses in dealing with problems like delivery delays, demand volatility, etc.

You can see why it's important to optimize your business operations in order to identify growth opportunities and save money, especially if your business operates on tight margins. A few tweaks can make a big difference.

Challenges in Modern Delivery Logistics

There are so many variables in delivery operations that businesses need to optimize constantly to stay competitive. Product demand and order volumes change over time. Before the COVID-19 pandemic, grocery shopping in brick and mortar stores was the norm. But today, more than 50 percent of consumers report that they have purchased groceries online in the past year, whether through a mobile app or desktop.

The pandemic spurred the exponential growth of demand for grocery delivery, but shoppers are still inclined to use grocers with delivery even after the pandemic ends, citing convenience as a key motivator. This is precisely why the processes of scheduling and planning need to be adaptable. There will always be, after all, fluctuations in demand, changes in driver availability, and maintenance needs to be done on delivery vehicles. There's no way you can keep the same schedule week after week.

Likewise, customer expectations regarding delivery experiences change over time. Thanks to technological advances, more than half of consumers expect that delivery orders can be tracked in real-time. Many big brands today offer same-day delivery and turnaround times as fast as one hour, eliminating the need for next-day delivery.

All of these factors, along with changing weather and traffic patterns, make optimization something that can’t be ignored. Businesses must incorporate it right from the start of their operations to ensure profitability throughout.

Grocery Delivery Optimization: How to Do It

Fortunately, there are delivery management tools that can be used to simplify grocery delivery logistics optimization. A feature-rich route optimization solution can help your company determine the most efficient last mile delivery routes by allowing you to schedule drivers more efficiently, provide real-time visibility to customers, and manage your field delivery service operations more effectively.

Route planning and scheduling

The right route optimization software takes a number of factors into account, including delivery volumes and capacity, service/delivery time, and overtime restrictions. Workload balancing needs to be adaptable based on your preferences. For example, perhaps you'd like drivers to drive the shortest route, or try to distribute grocery orders fairly among the team members.

Whatever your use case, you need functionality that enables easy, fast, and efficient scheduling and planning. A robust route planning solution allows you to match drivers with orders, plot routes, and set delivery times much more quickly than it would take to do it manually. After you enter your parameters, your software should take into account order delivery slots, driver constraints, delivery zones, and each vehicle's capacity, in order to ensure that you’re getting the most out of your capacity without risking late deliveries to customers.

Real-time visibility

The ability to adapt quickly is necessary if you want to succeed in today's real-world chaos. Fortunately, not every challenge you'll encounter will require a total overhaul. It might be as simple as rescheduling a delivery because an incorrect address was entered by the customer or redirecting a driver to avoid a road closure.

That’s why advanced route planning and optimization software needs to provide you with final mile tracking and visibility into your routes. With drivers dispersed over a large area, live tracking is the only way to effectively solve issues.

Trying to add a stop to your driver's route? The solution should show you which drivers are available in which locations, enabling you to plan routes accordingly. When a driver's tire blows, you can identify the closest driver to the blowout and ask that person to pick up items that are sensitive to temperature changes.

Smarter data analysis

Analyzing your data over time is necessary to optimize your delivery routes in the long term. When your software keeps track of the performance of your team and gives you detailed reports, you can adjust your routing and capacity plans or scale your business based on the analytics.

Automation of customer communication

In a survey conducted by Supply and Demand Chain Executive, 88 percent of consumers say they want to know where their purchase is in real-time. Your company can meet your customers' needs and enhance the customer experience with automated customer delivery notifications.

Create your own delivery messages and schedule them to be automatically sent at key points: when delivery is en route, when the drivers are nearby, and when the order has been delivered. Your customers should receive a real-time tracking link via email or SMS notification as soon as their order has been placed and at all other touchpoints—and your technology solution should make it quick and easy to send the right data to the right customer at the right time. 

With a powerful route planning and optimization solution, you can optimize grocery delivery logistics so you can always make smart decisions to meet your customer's needs, grow your operations, and take your business to the next level.