Fleet management or delivery management system refers to the process where companies oversee the transportation of finished goods from one location to the next.
Ecommerce businesses need to optimise their last-mile delivery for shipping customer orders to ensure they arrive on time and undamaged. Since online shoppers expect their parcels to reach undamaged, it’s necessary to maintain that. It helps to retain customers.
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Importance of Delivery Management System
As customer expectations rise, on-demand logistics are becoming essential in the supply chain. Online retailers need to deliver orders fast to keep customers loyal and stay competitive.
Effective delivery starts with a solid fulfilment and logistics plan. This includes picking, packing, and shipping orders quickly and affordably. However, without the right fulfilment systems and technology, delivering orders fast and accurately can be difficult.
So, to master the delivery management system, you can track the KPIs to ensure its smooth operations.
8 Important KPIs to Track for Mastering Delivery Management Systems
Here are eight KPI metrics that will be a boon for your delivery services:
1. Route Efficiency
This is the process of determining routes that are cost-efficient and productive. This involves finding the shortest path between the two points. It also covers all the relevant factors like delivery windows, vehicle capacity, driver schedules, traffic patterns, and the number of stops you can make on the delivery route, suggesting the optimal delivery route. All these factors ensure timely deliveries, improving revenue.
2. Fleet Productivity
The delivery management system also measures “fleet productivity,” a critical metric that assesses the driver’s behaviour, compliance, and service hours. They monitor the fuel usage, vehicle maintenance, and total usage as well. It examines the fleet’s overall performance, controls delivery costs, and enhances maintenance and efficiency.
3. Identify Delayed Deliveries
Identifying the delivery delays gives you insight into the efficiency and effectiveness of these routes. It helps management determine which routes are delaying deliveries; usually, mechanical errors, hardware malfunctions, and stock pickups cause these delays.
4. 3PL Performance
To keep delivery efficient when using third-party logistics (3PLs), it’s important to track deliveries. You can do this by measuring things like order accuracy, time to fill orders, on-time shipping rate, shipping accuracy, and cost per item shipped.
5. SLA and OTIF Adherence
A Service Level Agreement (SLA) is a contract between a customer and delivery provider that sets clear, measurable goals. A key part of SLAs is OTIF (On-Time, In-Full), which helps businesses ensure delivery consistency while monitoring the delivery process in the data warehouse. Digital tools make it easier to monitor SLAs and provide alerts for any issues.
6. Data on POC Effectiveness
Tracking measurable data in your proof of concept (POC) is essential to assess delivery success. Key metrics to monitor include auto dispatch rates, time on site, orders per driver, and on-time delivery. On-time delivery, which measures the ratio of orders shipped on or before the scheduled date, is a crucial KPI to follow.
7. Estimated Arrival Times
You can get the estimated time of arrival (ETA) using the best delivery management software and tools. It helps in customer and internal communication. To estimate the arrival time, businesses usually rely on reliable parameters, like predicting the actual time.
You can also calculate these parameters depending on the data histories from road network variables, traffic conditions, accidents, unprecedented events, or vehicle characteristics.
8. Customer Satisfaction
Another important metric that you need to monitor is customer satisfaction. This KPI significantly impacts your delivery business and profits. Many companies may not collect information about the customer’s feedback at every stage of their delivery.
For example, a 3PL provider may not offer the delivery experience customers expect, or a delivery partner might miss the estimated arrival time without notifying the customer.
This can lead to a poor impression of your delivery service, and if management is unaware, it could become a problem for the company later on. Thus, collecting and analyzing customer data is essential for a successful delivery business.
With that, let’s see the advantages of the delivery order management system.
Advantages of Delivery Management System
Here are some of the benefits you can reap with this system in your supply chain:
1. Delivery Profitability
Delivery profitability optimises existing business models through optimisation routes, fleet management, implementing the latest tech, and increasing fleet capacity. Good delivery is not only about timely delivery but also ensuring that the goods are not damaged. This ensures you achieve profitability by auto-scheduling and automating repetitive tasks.
2. Improved Customer Service
With the delivery software, you can constantly alert your customers via notification. They can always know the stage of the delivery process. Customers can live-track their parcels and stay updated regarding any delivery fast-tracking or delay.
3. Delivery Productivity
Delivery services must be prompt to prevent delays. Features like auto-scheduling, multi-drop route planning, smart order batching, and real-time route optimization can reduce manual tasks and boost delivery productivity.
4. Faster Delivery Turnaround Time
Delivery management software can analyze order history, study order profiles, pick zone efficiency, and product movement in the warehouse. This software identifies inefficiencies and finds ways to speed up delivery processes
5. Fuel Efficiency
Optimised route planning improves fuel efficiency. Delivery management system maps efficient routes based on urgency, customer location, driver availability, weather, and traffic. Smart route planning also reduces empty miles, saving fuel.
6. Reduced CO2 Footprint
Digital logistics tools cut fuel consumption by avoiding detours and vehicle idling. They also decrease miles travelled per delivery and reduce paperwork with electronic documentation. These changes help businesses lower their carbon footprint.
7. Better Compliance
The software ensures compliance needed to deliver goods and stay updated. Effective management of global trade compliance is crucial in a global supply chain. This accelerates customs clearance and regulatory compliance in other countries. With the information software, you can leverage information for improved visibility and real-time information for better compliance.
FAQs: Mastering Delivery Management Systems for Streamlined Operations
What challenges can you overcome with the delivery management system?
The 5 challenges a delivery management system can help you overcome are tracking shipments, improving communication, optimizing routes, reducing delivery times, enhancing customer satisfaction, managing costs, and ensuring timely deliveries with accurate data.
How does the delivery management software work?
Delivery management analyzes the process of moving goods from fulfillment centers to customers, optimizing packing and shipping, and providing order tracking for updates.
How can you improve your delivery management process?
To improve delivery management, implement technology and automation. This enhances visibility, real-time tracking, customer updates, and route optimization for better efficiency.
Conclusion
To sum it up, mastering a delivery management system is vital for streamlining operations and enhancing customer satisfaction. By tracking key performance indicators and leveraging technology, businesses can optimise routes, reduce costs, and improve delivery speed. This not only boosts efficiency but also strengthens customer loyalty.
To explore how Qodenext can transform your delivery management processes and help you achieve these goals, contact us today for a consultation!
