What did we find when customer assignment was reviewed?
In a distribution optimization project carried out at WEBLET, distribution centers that operated with a fixed regional assignment were examined.
The analysis showed that some customers were served from centers that were not the most efficient option in terms of travel time. Road structure and traffic during operating hours created a gap between geographic distance and the time required to reach the destination.
After the customer assignment was adjusted, one driver was able to serve 13 customers instead of 10 in the same working day.
This was an increase in the number of customers a driver was able to serve in one working day, not a measurement of cost savings and not a promise of the same result in every organization.
In this case, the improvement did not start by adding a truck, extending the working day, or looking for a slightly shorter driving route. It started by asking again who should serve the customer.
Micro logistics is not necessarily another warehouse
Micro logistics is sometimes associated with small urban centers, inventory points close to customers, or splitting a distribution network into smaller operating units.
Those are real options, but before investing in a physical change to the network it is worth asking whether the infrastructure that already exists can be used better.
Two neighboring distribution centers may be serving areas that no longer match demand patterns. A delivery route may cross a congested corridor every day, even though another center could reach the same customers by an easier road.
In such cases, changing service boundaries or the allocation of tasks can be useful without investing in another building.
Opening a logistics center is a strategic decision. Customer assignment and route planning can change without opening a new center.
Why is distance only part of the calculation?
In distribution to business customers, it is not enough to know how many kilometers separate the warehouse from the destination.
A store that receives goods only in the morning, a customer whose unloading takes a long time, and a site that requires a suitably qualified vehicle or driver create very different service conditions.
Order volume, vehicle availability, the sequence of stops, and the time spent at each visit also affect whether an assignment makes sense.
A sound allocation should therefore be based on the full set of constraints, not on geographic boundaries alone.
An optimization system that analyzes tasks and resources together makes it possible to examine alternatives that are hard to assess manually, especially when dozens of routes and hundreds of delivery points are involved.
Daily planning instead of boundaries that never change
Suppose that in a given organization one driver is permanently assigned to Rishon LeZion and another to Tel Aviv.
On a day when most tasks are concentrated in part of the two cities, a different split between the drivers may make better use of working hours and vehicle capacity.
This does not mean every driver should change area every day. It means a fixed assignment does not have to be a constraint that cannot be reviewed.
AI based optimization can help plan the work before departure, taking into account orders, drivers, vehicles, delivery windows, and the constraints the organization has defined.
The decision to apply a broader change to customer assignments or service areas remains with operations managers.
Field knowledge can stay in place, and each alternative can be checked against the numbers.
Managing delivery zones?
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How do you check whether the change is actually worthwhile?
Before changing the organization's entire distribution map, it is possible to choose an area or a number of routes and test different scenarios against the same order data.
It is worth comparing not only route length, but also working time, the number of delivery points completed, vehicle utilization, adherence to receiving windows, and operating cost.
Service stability should be considered as well. A solution that reduces driving but increases delays, or places an unreasonable load on drivers, is not necessarily an improvement.
The check can be done gradually, without immediately changing the whole distribution operation. The result can then be seen in practice before the method is extended.
The Bottom Line
Reducing distribution costs does not always start with a shorter route. Sometimes the important change is in the decision that comes before departure: which center will serve the customer, who will carry out the task, and how the work should be divided.
Micro logistics and data based optimization make it possible to examine decisions that once seemed obvious.
The way to avoid unnecessary trips often begins with changing the map used to plan them.
Further reading: מיקרו-לוגיסטיקה ופתרונות המייל האחרון - הסוף לעלויות ההפצה המטורפות? (original article in Hebrew by Irit Lotan, published on People & Computers).
