The purpose of this case study is to illustrate two things:
- Blue sky distribution network development.
- The ability to optimise the balance between own fleet and carrier deliveries.
Background
The client was a company with its packing site in West London that carries out domestic deliveries of parcels on dedicated vans to the South-East region and uses a parcel carrier to cover the rest of the country. The rising costs of using the parcel carrier coupled with the company’s rapid growth lead to this study to determine how much of the country could be served economically on dedicated own fleet vans and how much would have to remain served by parcel carrier.
Findings
- The map represents 23,400 orders per week.
- None of the regional sites existed at the time of the study.
- The coloured areas can be served economically on dedicated vans (80 % of orders).
- The black crosses are orders that are more economic to deliver by parcel carrier.
- Satellites in Carlisle, Newcastle, Swansea, East Anglia and Plymouth were proved to be uneconomic so were discarded.
- The solution offers a 17% saving over the base case.
- Forecasted growth would allow in due course up to 90% of orders to be brought onto the van fleet economically.
