Route optimization affects all aspects of a solid waste and/or recycling collection service provider organization. Efficient and cost-effective fleet and resource management through planning is the most important step in enhancing an organization’s bottom line.
Gary Lima and Bob Wallace
The waste industry has seen more changes than most of us can keep up with, not only within the most recent few years, but largely over the past three decades. Most company owners and solid waste industry management say the same thing, “I remember when we picked up the trash and took it all to the landfill”. A far cry from where the industry is today.
Now there are rules, ordinances, franchise agreements, municipal collection—processing, transfer—disposal contracts, collection service constraints and other regulations that dictate what collection service providers can and cannot do. For example, diversion, recycling, green waste, food and organics, C&D, medical, wet, dry, etc. It also seems the industry went from one truck type to several specialized vehicles, each unique and seemingly needed in its own way. Keeping up with the routing of all these services and collection vehicles has become an important part of efficiently managing any organizations’ or companies’ solid waste and recycling collection operations.
The economy has affected organizational goals for solid waste and recycling collection for all lines of business—residential, commercial and industrial—in today’s market. The motto is, “Do it cheaper, faster and with less resources and equipment now.” Maintaining service levels, contracts and franchise compliance have become more competitive often eroding profit margins.
The rapid growth spurt, preceding the recent recession, happened faster than anyone expected, and it led to adding more routes without having the time to create them efficiently. This resulted in a wide range of collection routes throughout the nation so unbalanced and inefficient that, now that the new growth has halted, it is time for both public sector agencies and private sector companies to strongly consider rerouting their customer base and begin running their routes more efficiently.
Route Optimization
Route optimization refers to choosing the best element from some set of available alternatives. Rebalancing routes for reducing hours and miles, it involves improving fleet and manpower productivity and profitability.Route optimization affects all aspects of a solid waste and/or recycling collection service provider organization. Whether private or public sector, efficient and cost-effective fleet and resource management through planning is the most important step in enhancing an organization’s bottom line. Understanding all the parameters and how they create impact an organization’s service objectives allow collection service providers to choose the right tools for the job.
To begin route optimization, reducing route hours and miles driven are accomplished by benchmarking an organization’s current operations and driver procedures, then analyzing that data to identify key areas of needed improvement and make the necessary changes. There are a variety of decisions to be made with respect to collection vehicle routing, customer service impacts, day of service changes, whether or not to purchase routing software, GPS, onboard systems, etc., and, more importantly, which professional experts to hire to assist in helping make the critical decisions and the implementation of the needed changes. One thing that is certain, those who invest in route optimization will be more profitable.
Software and Technology
Routing software has been around for a while now and is widely used, however, a large portion of the industry still uses more traditional methods of physical maps and pins to improve collection vehicle routing.
The most significant changes have been in the digital mapping technology. Back in the 1990s when computer routing software was first introduced, the biggest obstacle was geocoding an organization’s customer locations. This is the process of assigning an address to a digital map. The problem was all streets were not included or they didn’t have an address range entered. One could use latitude and longitude coordinates to place the customer on the map but it wouldn’t route by the street address.
Back then, the biggest goal was to reduce the number of hours it took to service all customers. The more a person worked with the software and were able to analyze the results one began to realize many advantages to using a program that used algorithms to find the quickest way to route vehicles through your service area. As a result, the need for becoming experts at benchmarking was apparent. The key is to break down the processes and know the details allowing one to manage better and make more informed process improvement and waste management collections operational decisions.
Other advantages of the use of software and technology become apparent when a collection service provider organization is trying to determine where the most optimal place is to purchase an office or yard for their vehicles. Some software offers great logistical uses for this type of facility siting studies. The software allows organizations to identify the best location for a depot in a service area or geographical location. The right software also allows organizations to review the impacts of adding a transfer station or MRF to see how that would affect drive times to and from the collection routes, as well as non-driving times—thus being able to better calculate collection costs.
As stated before, GIS mapping has come a long way. Some haulers have already starting using Google Earth maps in their routing processes. New technology has been, and will continue, to be an important function for waste collection service providers (organizations/haulers) in being as efficient as possible.
Routing Parameters and Constraints
There are a multitude of parameters that need to be included during the routing process and the more detail that is used, the better the results are versus using estimates or averages. For example, having actual stop times always allowed for routing more stops per day. The same goes for travel speeds and time windows—one can calculate the most optimal time to service any given street.
Another area that plays a key time constraint role—impacting driver productivity, collection vehicle on-route time and fleet maintenance—is the time at the disposal or processing facility (transfer station, MRF or landfill). As part of the route optimization, review the transfer station, MRF and landfill traffic congestion (scale and dumping queuing line times) in order to determine an adjustment in start times and changing load commodities. This can be accomplished, in part through the use of certain types of routing software, allowing changes to the parameters that lead to greater efficiencies.
There are so many different services, terrains, weather conditions and seasonal customer bases and set outs that having a tool to help plan for these differences is critical to using labor and equipment the most efficient way.
Route Optimization Best Management Practices
There is no one method or way of producing optimized routes. Waste and recycling collection service providers look at this process from many angles. Some organizations simply want better driving directions from route optimization. They feel this method will help not only the driver, but also any relief or new drivers to figure out the quickest way to complete their routes. Interest in this method becomes particularly popular when fuel prices increase.
Another method for route optimization is setting up parameters to route all collection vehicles by the shortest driving distance. The biggest difference when using driving directions for residential and commercial routes is the sequencing of commercial stops. There are multiple ways of accessing a commercial property especially in strip malls and corner locations. This means sitting down with the drivers and manually sequencing each route. Quite often, software cannot distinct all the ways to access a property or know the exact bin placement location needed for optimization.
Route optimization provides collection service providers the advantage when bidding or proposing on a new service contract. Knowing how many collection vehicles and hours it will actually take to service a city or service area helps organizations set reasonable and competitive rates.
Safety has become an important part of everyone’s business. Route optimization and route auditing through driver ride-alongs, identifies many safety issues on route and once those are exposed, it gives the collection service provider a better way of making changes to prevent injuries or accidents. This helps organizations decide if they need to put a helper on a truck or create a scout service for the route, increasing efficiencies, reducing on route collection costs and improving bottom-line profitability.
Routing and Customer Billing
Route optimization also can be linked to customer billing (invoicing). Knowing where a collection service providers’ customers are is one thing, but knowing where the competitor’s customers are is another, at least in “open” not contracted or non-franchised markets. Identify potential growth areas that would make routes more profitable. On–board computers, AVL and RFID are starting to play a role in optimizing routes. Though each of these products has their advantages, there is still room for improvement.
A Strong Recommendation
There are many ways to accomplish route optimization. When it comes to enhancing an organization’s bottom line, take the time to evaluate any product or service and realize that there are experienced people in the industry that can assist you and your organization in route optimization, route auditing, benchmarking operational process improvement and providing you with software and technology solutions recommendations and post purchase/back-end support.
Additionally, and as a strong recommendation, consider the software or technology service providers’ back-end (post purchase and product or technology install or implementation) customer service support when purchasing routing or other software and technology tools to allow time to use the software for what ifs.
Gary Lima is Founder, President and CEO of Stealth Marketing (Yorba Linda, CA), a service provider for major and smaller haulers and municipalities across the nation offering owners and operators unparalleled, specialized waste management services. A pioneer of proprietary route auditing techniques and best practices, Stealth Marketing is experienced in route smart, caps logistics, GIS, GPS and ESRI software, digital mapping and geo-coding services, professional consulting and policy and procedure implementation, cost analysis services and special waste programs. Programs and findings are tailored to improve all areas of a company’s business, providing the ultimate validation that operations are running optimally. This provides peace of mind to clients and the satisfaction that they’re doing all they can to maximize their businesses and growing profits. Gary can be reached at (714) 469-3571 or via e-mail at [email protected]
Bob Wallace, MBA, is a Principal and Vice President of Client Solutions for WIH Resource Group (Phoenix, AZ), providing diversified services and extensive experience to clients in both the private and public sectors. Bob has more than 25 years experience in solid waste and recycling management, transportation/logistics operations, fleet management, alternative vehicle fuel solutions (CNG, LNG, Biodiesels, etc.), WastebyRail program management, recycling/solid waste program planning and development. Bob has expertise in the areas of solid waste and recycling collection routing and route auditing, disposal and transportation rate and contract negotiations and strategic business planning. He has extensive experience in conducting both solid waste collections and transfer station operational performance assessments OPAs (a business improvement process). Bob previously served as a board member for the Arizona Chapter of SWANA and has served on the National Solid Waste Rate Committee for the American Public Works Association. He is also a former board member of the California Refuse and Recycling Association’s Global Recycling Council. Bob can be reached at (480) 241-9994, via e-mail at [email protected] or visit www.wihrg.com.
Lessons Learned from Experience
Staff from Stealth Marketing (Stealth) and WIH Resource Group (WIH) have been performing special projects for the last 15 years. They have seen waste hauling operations from Alaska to New York, ridden with hundreds of drivers, worked with countless waste management and executives, analyzed operations, billing, sales and customer service, safety and maintenance managers.
Most of the work related to route optimization consists of performing route audits, vehicle routing and billing audits, creating new routes or optimizing current routes and implementing new programs. Both firms’ staff have worked with GPS, GIS, digital mapping, handhelds and various kinds and types of route and route optimization software. Both firms’ client-specific efforts have produced millions of dollars in savings and new revenue for clients.
Some of the key takeaways from all of this experience, specifically from riding on trucks on collection routes and tracking productivity, has allowed staff to see which routes are most profitable. Experience shows that it quickly becomes evident in determining who a collection service providers’ most profitable drivers, routes and customers are.