Vehicle Routing Algorithms in the Logistics Industry

There are many types of algorithms used in route planning and route optimisation software within the transport logistics industry. Many seek to solve the “vehicle routing problem” and produce the optimal route plan with minimum-cost routes originating and terminating at the same or multiple depots. Sometimes a vehicle routing problem will include delivery time windows which are specific to the order and/or delivery location. Some algorithms specifically address frequency based requirements as compared to others that address dynamic, next day operations.
The Vehicle Routing Problem is related to the Job Shop Scheduling Problem but both are solved using differing techniques.
Route planning software and algorithms
An algorithm is a process defined by a computer that describes all the steps that are necessary for that process to have a successful outcome. Route planning and optimisation software connects two destinations typically by the ‘least cost’ route using a journey planning engine that consists of one or more algorithms. The ‘least cost’ is clearly subject to variables such as vehicle type, fuel consumption, load capacity, road network speeds, product type, etc.
By definition route planning is about a ‘plan’ – a theoretical view purporting the ‘optimal way’ to deliver or collect goods over a road network. There are also ‘real time issues’ to consider such as heavy traffic, unexpected road closures or diversions and so some route planning software enables users to update the plan ‘in real time’.
The planning ‘engines’ can be purpose built for road transportation; however, specific programmes are available for rail transport where multi-drop route planning software is often necessary.
Most route planning software solutions apply algorithms to ‘low density’ problems, that is, where the drops and collections are spread out across a wide area of many miles, or at least across a number of zip/post codes. There are a few ‘high density’ route planning solutions that can apply a different set of algorithms to enable door-by-door, street-by-street route planning as characterised by postal delivery, utility meter reading and domestic waste collection.
Route optimisation in a commercial setting
In the modern logistics sector it is still common for companies not to have specialised route planning software incorporated into the overall logistics operation. Route planning systems often incorporate related technologies such as GPS tracking, in-cab reporting and telematics that enable drivers to ensure that routes meet their target times and costs. These technologies help keep costs low by minimising unplanned stops (by keeping vehicles maintained to the highest possible standards), keeping mileage down and turning engines off during idle times.
In terms of route planning software the optimal path should consider factors such as the fastest route, which collection/delivery points exist on the route and any timescales for delivery that may be desired by clients and customers. Route optimisation is therefore concerned with finding and connecting different locations and using algorithms which are sufficiently advanced to compute all options enabling managers to determine the best choice under a given set of circumstances.