Inefficient route planning was causing headaches at Arctic Glacier, a manufacturer and distributor of packaged ice products serving 75,000 customers throughout the U.S. and Canada. Rising costs, seasonal market fluctuations, and fast-paced corporate growth necessitated a flexible routing solution that would allow the company to quickly reset and adjust its transportation network to keep up with demand.
Company leaders turned to Descartes Systems Group and its automated route-planning solutions to solve the problem.
“Given the rise in input costs, like fuel and driver wages, and our acquisition-driven growth strategy, we wanted to lower costs by reducing miles and routes while running the optimum number of vehicles and drivers to meet customer needs,” Elizabeth DiFazio, Arctic Glacier’s routing director, said in a statement describing the recent IT project. “The Descartes solution helped us maximize fleet utilization, curb labor and transportation costs, and increase delivery efficiency across peak summer highs and lower winter volumes.”
MEETING THE CHALLENGE
Arctic Glacier serves customers via a privately owned fleet of 1,500 trucks and more than 100 warehouses, production facilities, and distribution centers. Given the business’s dramatic, weather-dependent fluctuations in order volume, company leaders say they needed to be able to flex more quickly to capture peak revenue during seasonal spikes, while maximizing last-mile delivery efficiency during periods of both higher and lower demand.
With a growth strategy focused heavily on acquisitions, the company sought a solution that could help it scale distribution without additional labor. Arctic Glacier also wanted to curtail rising fleet-related costs, optimize fleet composition, and boost profitability while supporting a continuous cycle of delivery improvement.
And it needed to move beyond traditional route planning toward a more advanced, optimized approach.
APPLYING THE SOLUTION
Ultimately, leaders at Arctic Glacier determined they needed to transition from a territory-based route-planning approach to strategic route planning to better accommodate the company’s growing distribution network. Using Descartes’ advanced planning and optimization technologies, the company moved to strategic route plans—master routes, for example—and daily dynamic planning to maximize productivity.
Here’s how it works: By analyzing variables such as customers, volumes, service policies, asset types, and operational constraints, the solution determines the optimal combination and location of Arctic Glacier’s resources—its distribution centers, fleet size, and drivers, for example—to control costs while meeting customers’ delivery expectations. Policies, practices, and capacity can be flexed to accommodate new or altered routing strategies to keep pace with fluctuations in demand or new business goals, such as supporting acquisitions.
Arctic Glacier can now replan master routes more frequently to boost delivery efficiency, reduce operating costs, and scale easily to manage seasonal demand swings.
“We have up to 1,500 trucks delivering in the summer, dropping to 400 in the winter months,” DiFazio explained. “With Descartes strategic route planning, we can create master routes every [one to two] weeks, instead of monthly or quarterly, to continually fine-tune delivery productivity and cost-effectiveness.”
REAPING THE REWARDS
Among the benefits of the project, Arctic Glacier says its route planners have become more productive and its drivers more efficient. As one example, each of the company’s route planners can now singlehandedly manage 30 branches compared to just 12 before the project.
“In fact, we were able to acquire two large businesses at a quick pace—with approximately 30 additional trucks across three facilities—without adding any new routers to the team,” DiFazio said.
On the fleet side, the new system’s operational route-planning execution capabilities keep managers aware of progress, provide customers with an ETA for deliveries, and capture essential proof-of-delivery details—all of which supports customer service excellence and order accuracy through real-time mobile communication.
