For businesses & non-profits operating on thin margins, there’s high interest in strategies for how to reduce labor costs without cutting needed staff. One of the best, most affordable way to implement a labor cost control initiative is to deploy affordable route optimization software tools like RouteSavvy.
Route Optimization Software Shows How To Reduce Labor Costs With A Modest Investment
In addition to reducing miles driven and fuel costs, route optimization software tools like RouteSavvy can save time, allowing businesses & non-profits to handle more deliveries, pickups, service calls, or sales calls in the course of an 8-hour workday instead of having to go into overtime. This helps organizations minimize the need for staff to work after hours and is a classic study in how to reduce labor costs.
Let’s review how this works with an appliance delivery company:
- Acme Appliances has a fleet of 6 delivery truck drivers who earn $36,000 a year. Their hourly rate is $18/hour. Their overtime rate is $27/hour
- Each driver delivers and installs an average of 10 appliances per day.
- Each technician typically has to work 3 hours of overtime each week, which is paid at time and a half of their hourly rate. The cost of overtime labor for the 6 workers is $486 per week, or just under $2,000 a month.
- The cost of overtime labor is not passed on to the customer, because they’ve already paid for the appliance and a flat fee delivery charge of $50.
- By deploying route optimization software like RouteSavvy, Acme’s delivery drivers drive fewer miles in an 8-hour day.
- If RouteSavvy helps the 6 delivery drivers work just 2 hours less of overtime each week, the savings to the company is $324 per week; roughly $1,300 per month; and a whopping $15,552 dollars per year.
- For small to mid-sized businesses, these savings can have a significant and positive effect on a company’s bottom line.
Organizations that explore how to reduce labor costs will find that route planning software tools like RouteSavvy are one of the most cost-effective ways to do so, particularly if the goal is to reduce overtime labor. Any business or non-profit owner or manager looking to mitigate overtime labor costs should deploy affordable route optimization software such as RouteSavvy. RouteSavvy, for example, costs just $30 / month but can start saving time and money the day it is deployed.
Dealing with overtime labor issues & need to learn how to reduce labor costs, affordably? Check out RouteSavvy’s Free, 14-day Trial.
