Software provider strives for same-day delivery, holds world records for efficiency

As internet retailers move to brick and mortar and brick-and-mortar retailers use stores to fulfill online orders, the move to same-day delivery of goods has come into focus for retailers. And recently, solution architect Robert Oliver of Quintiq showed how the company’s software could work to achieve same-day delivery at world-record efficiency.

E-commerce company Amazon took another step toward same-day delivery when it received a patent on plans for its delivery drones. Plans show how the drone would fall apart in the event of an issue related to “weather conditions, equipment malfunctions and other problems,” according to the patent. Parts of the drone would fall off in specific areas such as over water, forests, fields and “other locations more suitable for dropping components of the UAV (unmanned aerial vehicle).” Amazon’s Prime Air drones are expected to deliver shipments up to five pounds in 30 minutes or less, according to the company.

Quintiq is based in the Netherlands and is a subsidiary of Paris-based Dassault Systems.

In a recent Logistics Management webinar, Oliver said customers want narrow delivery windows, such as being able to select whether they can receive their item in the morning or afternoon, and they want to be able to track and trace their shipment to know when it will be delivered, Oliver said. Shipments aren’t only those going to distribution centers but also store to store shipments. And when a customer returns an item to a store it might need to be shipped out.

The Quintiq software offers the ability to shape delivery demand and provides incentives to customers who select a shipment time that could lower shipment costs. Figuring out which deliveries to put on which trucks is a “difficult puzzle to solve,” Oliver said. A supercomputer can plan a route shipment with 10 deliveries in a “fraction of a second,” but planning for a route with 24 to 30 deliveries could take years for the same computer, causing a “combinatorial explosion.” The Quintiq software plans the most efficient routes and creates forecasted stops within planned routes.

“We use mathematical optimization,” Oliver said. “This allows you to achieve on-time delivery,” while reducing the number of hours worked and trucks needed.

With forecasted delivery, customers can choose to receive a shipment at a lower rate if near a forecasted stop. If selected, the shipment can be added to the planned route at a lower cost than if it were added to the shipment at a different point during the route. The dynamic pricing range is based on when the customer wants the item shipped.

Quintiq offers users projected key performance indicators (KPIs), and can operate on a mobile app for iPhone or Android or be integrated with a carriers’ on-board computer system. While the truck is on the route, the dispatcher can see the steps taken during the shipment process.

If a truck were to break down, it can show how late the shipment would be or the new timeframe if the items are placed on a different truck. For unplanned orders, the software has an optimizer that suggests the best route. It can also generate routes for continuous moves or “triangle routes” and complex shipments that aren’t just shipments from the distribution center to the store and back.

Quintiq users can subscribe to use the software or purchase a perpetual software license.

The software company has broken more than 80 world records for generating the fewest routes required for pickup and delivery within time windows, and it set out to break the records because the company “had the best optimization around,” Oliver said. Breaking the world records allowed it to prove this, and the company still holds more than 70 of the records.

“We are the only commercial software vendor that holds any of these world records.”