Hermes, one of Europe’s leading home delivery specialists, has made substantial savings in its transport costs using optimisation software from Paragon Software Systems. Hermes uses Paragon to automate planning of deliveries from 14 of its 18 depots to final mile couriers throughout the UK mainland. The routing and scheduling software has already helped Hermes achieve significant efficiencies, with annual savings of £300,000. This figure is expected to increase following the use of Paragon at the remaining depots.
"Paragon has provided us with a range of tactical benefits already. It helps us with developing very accurate routes and has already saved us about £300,000 annualised, thereby paying for itself several times over. It is a good, easy to use, and fully functional solution for our operation. The software allows us to reduce our mileage – and this amounts to an average cost saving of £162 per year for every mile we don’t drive on a daily basis," says William Ellis, Network Development Manager.
Hermes uses Paragon Multi Depot to plan optimised set routes allowing for narrow delivery windows of no more than 4 hours. Each delivery point – where drivers drop parcels to couriers – varies from urban to rural and, therefore, routing accuracy is essential to maintain maximum efficiency within delivery times. The software also enables the network management team to optimise use of the fleet, ensuring that the most appropriate vehicles are used for each delivery.
"Paragon gives us a big picture view of our delivery network allowing us to maximise the use of the fleet and fit the right vehicle to each route. Because the delivery points vary, the software helps us decide where we need to deploy 7.5 tonne rigids and where we are better using – or can only use – long wheelbase vans. It also helps us to identify where we are best using two vans rather than one ‘7.5 tonner’ and vice versa," says William Ellis.
Hermes re-runs its delivery routes every 6 months to ensure that each depot is running at peak efficiency. This is important as couriers can change, leave the job or move areas.
"With Paragon we don’t really need to worry about the churn rate of our couriers. To ensure we are managing resources efficiently we simply re-run routes from each depot twice a year and that way we are confident of maintaining optimum routings," says William Ellis.