Four key benefits of improved transport management
Whether automotive supplier, manufacturing company or logistics provider, the entire industry is suffering from enormous cost pressure and a shortage of skilled workers. At the same time, delivery deadlines must be met and measures to reduce emissions must be taken. Read this blog post to find out how holistic transportation optimization with AI can help companies better meet these challenges.
Transport optimization – what does it involve?
The aim of transport optimization is to improve the efficiency of transport processes by optimizing routes, vehicle utilization and schedules. It reduces costs, minimizes empty runs, lowers emissions and increases delivery reliability.
Ideally, transport management is deeply integrated into the value chain. Only then can it reach its full potential, because transport optimization begins in production. Here, improved synchronization of time slots can reduce waiting times, save storage capacity and take delivery dates into account. Subsequently, it ensures that the appropriate means of transport, optimally loaded and taking the most efficient route, arrive at their destination on time at the appropriate rate.
Adequate transport management also fulfills controlling tasks: It should check whether the route selection was actually the most efficient and whether the means of transport were found at the customer’s premises in accordance with the loading strategy.
Optimal loading space utilization, production synchronization and intelligent route selection may have many potential advantages, but what about in practice? What can transportation optimization do for a company?
1. Reduce costs by a quarter with transportation optimization
The average truck capacity utilization in Europe is 67.4 percent, which results in a savings potential of 205 billion euros – a gigantic sum that could potentially be saved, provided that all trucks were optimally utilized. This demonstrates that transportation offers enormous savings potential. A holistic transport optimization takes advantage of this potential by consolidating shipments and thereby maximizing transport capacity.
At the same time, a transport management solution must automatically take agreed delivery dates and its own storage and capital commitment capacities into account when bundling shipments. It must ensure that its own resources and agreed deadlines are met. Otherwise, transport optimization fails in its purpose and is practically unusable. The S2data platform always seeks the sweet spot, i.e. the best possible consolidation of deliveries that can be implemented while meeting delivery deadlines and taking into account your own production and storage capacities as well as material procurement.
In addition to maximizing transport capacity, improved route planning is an important lever for reducing costs. The route planning feature of the S2data platform, for example, automatically finds the most efficient delivery routes together with the appropriate rate – whether FTL, LTL or LTL. Normally, this would only be possible with a high level of manpower: a dispatcher would be solely responsible for planning the optimal route together with the appropriate rate. A digital solution for transport optimization, on the other hand, can do it in seconds.
The combination of maximizing delivery capacities with more efficient route planning can achieve cost savings of up to 25 percent compared to manual transport planning.
2. Save 20 percent of CO2 emissions
One positive side effect of improved route and loading planning is that it not only saves fuel and costs, but also, logically, CO2 emissions. Every transport operation and every kilometer that is reduced shrinks the ecological footprint.
The savings potential for emissions through transport optimization is just as high as for costs. Since, as mentioned at the beginning, trucks are only 67 percent full on average, there is plenty of scope for making better use of capacity and avoiding unnecessary trips. Fewer trips mean lower resource consumption: improved planning can save around one-fifth of the emissions caused by transportation.
3. Better prepared for ESG reporting requirements
In addition to the positive effects on the environment, CO2 reduction offers another advantage that will be particularly important for many companies in the near future: From 2026, small and medium-sized capital-market-oriented companies will also be required to disclose their ESG measures on the basis of the EU’s ESG legal framework. ESG stands for Environmental Social Governance. Together, these three criteria form a set of rules that should make it possible to evaluate companies based on their sustainable and ethically responsible actions.
If a company optimizes its transportation and demonstrably saves resources and emissions as a result, it can also prove specific improvements to its environmental balance.
4. Intelligent planning really does reduce the workload
Digital transport management takes the pressure off dispatchers. It can be easily docked to all common Enterprise Resource Planning, Transport Management or Warehouse Management systems and an automated data transfer can be established. Based on the data generated by the ERP system, it intelligently plans the transports automatically using algorithms and AI – an incredible relief in day-to-day work. At the same time, dispatchers always have an overview and control over the bookings. They can see how the transports are planned and can make adjustments on demand, to which the transport management can react.
Incidentally, the transports are also fully optimized for the operational business. This means that stackability, a loading plan and axle loads are also taken into account in the loading planning.
Conclusion: Those who optimize remain competitive
Intelligent transport optimization not only increases efficiency, but also significantly reduces costs and emissions. Improved truck capacity utilization, optimized route planning and the use of digital solutions maximize transport capacities, avoid empty runs and achieve savings of up to 25 percent. At the same time, it helps to reduce CO2 emissions by up to 20 percent – an important step towards more sustainable supply chains and compliance with future ESG requirements. Transportation optimization also makes life easier for dispatchers by automating manual planning tasks, thus enabling more efficient processes.
Holistic transportation optimization is more than just a cost issue – it is a strategic necessity. Those who consistently optimize their transportation are better prepared for future challenges and sustainably strengthen their competitiveness.
Find out here what savings potential your transportation management has.
Further sources:
https://logistik-heute.de/sites/default/files/public/data-statische-seiten/nexolab_schmitz_0.pdf
https://www.lawcode.eu/blog/esg-reporting/
Sources are in german