There are many challenges when it comes to running a food delivery business. Especially if you are a smaller business with only a limited number of employees and vehicles, it can be extremely difficult to manage all of the moving parts necessary to ensure you are delivering a quality experience in a cost-effective way. As your business grows, small inefficiencies can really add up and start to affect your performance and profitability. This is why it is vital to understand the real costs of doing business and take advantage of tools such as automatic scheduling, data analytics, and routing software.
In today’s blog, the delivery management experts from GetSwift want to dig deeper into route optimization and discuss the real cost associated with drivers going just a few miles out of their way. While no business is perfect, and there are always exceptions that fall outside of the rules, focusing on having your drivers take the most optimum routes for each and every delivery can make a huge difference to your bottom line. Keep reading and then contact GetSwift to learn more.
Extra Miles Add Up
If you’re in the business of food delivery, you know that if your deliveries aren’t well-executed the cost can eat into profit. And worse yet, your customer service can suffer. If you aren’t at the top of your game, there are plenty of other businesses standing in line to take your place. The market for delivery services has exploded over the last handful of years, and there is more and more competition every day. So how can driving a few extra miles out of the way make or break your success? Consider the full picture.
Let’s look at an example. Let’s say you own a small food delivery business where you employ 5 drivers to cover a 20-mile radius. Since you are small, you decide to just let your drivers plan their own routes. After all, they are only spanning the north end of town — do you really need routing software for that? After 6 months in business, you notice that you are barely covering costs, and it looks like you’ll have to hire another driver, which is something you don’t have the budget for. You sit back and wonder “What am I doing wrong?”
It’s entirely possible that inefficient delivery routes make your delivery costs much higher than they should be. Let’s break it down to see just how your business is being affected:
It goes without saying that if you drive more miles, you’re going to have to pay more for fuel. While a couple of extra miles might not equate to much, when you look at it over dozens of deliveries, multiple drivers, and over the course of the year, it can really add up.
Many people don’t consider vehicle maintenance when analyzing their delivery costs, but the truth is, vehicles are very expensive to maintain! More miles means they’ll require more frequent oil changes, there’s more opportunity for needing major repairs, and a decrease in overall vehicle lifespan. Again, when you look at each piece individually it seems like we are talking about nominal costs that aren’t even worth tracking, but in actuality, it all adds up.
Do More with Less
Optimizing your driving routes doesn’t just help with the direct cost of fuel or vehicles, it also allows you to do more. If your drivers are taking longer to complete deliveries, then you’ll have to hire more people to get the work done. Hiring more people is very costly and should only be done if deemed necessary to accommodate your growing business and not to make up for inefficiencies. If each person can deliver just one extra delivery per day because their routing software has taken them around heavy traffic areas, that means your overall cost to do business goes down and your profit will go up.
Time is Money
When you optimize driving routes, you’re not just able to do the same amount of work in less time, but in the food delivery business, time is of the essence. Your customers expect to receive their pizza hot, their milk cold, and if you take too long on the road, the end result won’t be good. To meet the demands of a finicky food delivery business, the best thing you can do is reduce the time between pick up and delivery.
If you want to make sure your drivers are taking the best routes so you can reduce delivery times and put money back into your budget, contact the delivery experts at GetSwift. We have a 30-day risk-free trial and can have you up and running in no time. If you want your business to thrive, it’s often necessary to invest in the tools to help you get there. Give us a call today or ask questions through a live chat with our 24/7 support team. We look forward to hearing from you!