|Study Period:||2018 - 2026|
|Fastest Growing Market:||Asia Pacific|
|Largest Market:||North America|
Need a report that reflects how COVID-19 has impacted this market and its growth?
The route optimization software market is expected to witness a growth at a CAGR of 10.9% over the forecast period (2021 - 2026). Companies across industries providing delivery services face several challenges during the crisis faced due to the ongoing COVID-19 pandemic. Several companies are formulating mitigation strategies to ensure uninterrupted and fast delivery services. For instance, due to the lockdown restrictions, a sudden surge of online grocery shopping was witnessed. This led to a sudden rise in the demand for grocery deliveries, which led to a major challenge for e-commerce and online retail and grocery companies to deliver groceries on time. Hence, route optimization software is expected to grow during the crisis.
- Several industries, such as food and beverages, retail and e-commerce, logistics, and many more are increasingly transforming their business processes to provide delivery services, including on-demand food delivery, retail and grocery delivery services, and e-commerce delivery. Such developments are expected to act as a major catalyst for the increase in demand for route optimization software.
- Route optimization enables the companies to optimize route planning, delivery time, and enhance customer experience by maximizing completed order delivery. Automating route optimization by adopting route optimization software integrates real-time data and visibility in route planning and improves and enhances their fleet management strategies. It primarily helps in optimizing the vehicle routing and route progress tracking in real time. It also helps in reducing fuel costs by providing the most optimized route.
- According to a global survey conducted by Verizon, in 2019, among the surveyed fleet managers, more than one-third of fleet managers who do not use route optimization solutions believed that they would expect an increase in productivity implemented the technology. The survey also indicates that over 53% of companies that make use of route optimization software reported actual productivity increases, with most of the respondents reporting positive growth in productivity (53% respondents) and compliance (52% respondents).
- Businesses across the world are increasingly adopting smart transportation strategies to enhance their delivery service. This has led to a substantial rise in the adoption of commercial fleets. According to the Automotive Fleet data, in the United States, sales of vehicles to commercial fleets witnessed an increase of 17% to 69,726 in September 2019, compared to the previous year. Hence, the adoption of route optimization software is expected to rise.
Scope of the Report
The study characterizes the various dynamics of the route optimization software market based on its deployment across various end-user industries and geographies. Route optimization software technologies are used to plan and optimize the routes of the drivers of the fleets to increase route efficiency and deliver the task in less time. It includes real-time and dynamic routing solutions that support on-demand operations. These route optimization software have a wide variety of applications in numerous end-user verticals, such as on-demand food delivery, retail, field services, and ride-hailing and taxi services.
|End User Vertical|
|On-Demand Food Delivery|
|Retail and FMCG|
|Ride Hailing & Taxi Services|
|Other End User Verticals|
|Size of the Organization|
|Small and Medium Enterprise|
|Middle East and Africa|
Key Market Trends
Growing Focus on Reducing Environmental Impact and Increasing Productivity of Fleet is Expected to the Market Growth
- Nike Inc. mentioned that logistics are also the main contributor to carbon emissions, apart from raw material and manufacturing. Logistics is estimated to contribute over 10% of the total carbon emission by the company. The company has been focusing on reducing 30% CO2 emission through logistics by the end of 2020.
- Spelthorne Borough Council, England, mentioned adopting route optimization software for its kerbside collection services. With this implementation, the department was able to achieve a reduction in CO2 emission by up to 30% and driving time. Also, the company claimed that it increased the fleet's productivity and was able to reduce its fleet size by over 15% and support future fleet planning.
- DHL, one of the largest courier and logistic companies operating in over 220 countries and territories, mentioned using route optimization software as its last-mile B2C delivery product and orchestrate key last-mile processes. With this implementation, the company achieved a 15% increase in the productivity of delivery agents, reduced operational costs & increase profitability.
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North America is Expected to Hold Largest Market Share
- North America is expected in dominating the market, as there is a considerably high penetration of vendors offering route optimization software solutions. In the year 2019, it was estimated that over 35% of the companies that deployed "Asset Management" solutions in the region had installed basic GPS location tracking equipment, while more than 45% of such users have customized asset tracking systems, more precisely for route management and optimization.
- Also, several regional delivery services companies are collaborating with route optimization software providers to enhance their delivery planning and optimize their supply chain management. For instance, UPS enhanced its On-Road Integrated Optimization and Navigation (ORION) platform with Dynamic Optimization, which is expected to automate and analyze individual package delivery routes throughout the day, as traffic conditions, pickup commitments, and delivery orders change.
- Also, in January 2020, a global supplier of integrated software and vehicle technology, AMCS, acquired the Canada-based software solutions provider for the waste industry, TRUX Route Management Systems Inc. The acquisition is likely to enable AMCS to expand its business in North America.
- In October 2019, LiteLink Technologies Inc. launched PerfectRoute, a delivery route planning and fleet optimization solution for all the types of vehicles designed for last-mile delivery, powered by the 1SHIFT Logistics platform. The route optimization solution is expected to be provided to enterprise customers via LiteLink’s flagship 1SHIFT platform. Such initiatives by various solution providers and delivery service providers are expected to boost the adoption of route optimization software in the region during the forecast period.
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Route Optimization Software Market is despite been moderately fragmented has increasing growth opportunities. The market has been witnessing continuous new entrants offering similar route optimization software solutions. Due to these new entrants, companies are focusing on making product innovations to gain on competitive advantage. Also, the companies are viewing fundraising as a lucrative path to expand their market presence.
- May 2020 - DispatchTrack, a provider of SaaS-based last-mile logistics Route Optimization solution, announced to raise over USD 144 million from Spectrum Equity. With this funding, the company plans to transform the last mile deliveries for more businesses across categories and around the world.
- May 2020 - Dynamic Route Optimization - Route4Me announced to provide its last-mile route optimization platform to support its fight against Covid-19 in The Red Cross of Rome, Italy.
- February 2020: OptimoRoute, the route planner tech startup founded by former Yelp and Google engineers, announced that it had raised a USD 6.5 million funding, to expand its reach and further develop its offerings for a multitude of mobile workforces.
Table of Contents
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET DYNAMICS
4.1 Market Overview
4.2 Industry Value Chain Analysis
4.3 Industry Attractiveness - Porter's Five Forces Analysis
4.3.1 Bargaining Power of Suppliers
4.3.2 Bargaining Power of Buyers/Consumers
4.3.3 Threat of New Entrants
4.3.4 Threat of Substitutes
4.3.5 Intensity of Competitive Rivalry
4.4 Assessment on the Impact of COVID-19 on the market
4.5 Market Drivers
4.5.1 Increasing Use of Logistics-Specific Solutions
4.5.2 Declining Hardware and Connectivity Costs
4.6 Market Restraints
4.6.1 Handling Structured and Unstructured Data
5. MARKET SEGMENTATION
5.1 End User Vertical
5.1.1 On-Demand Food Delivery
5.1.2 Retail and FMCG
5.1.3 Field Services
5.1.4 Ride Hailing & Taxi Services
5.1.5 Other End User Verticals
5.2 Size of the Organization
5.2.1 Small and Medium Enterprise
5.2.2 Large Enterprises
5.3 Deployment Mode
5.4.1 North America
5.4.3 Asia Pacific
5.4.4 Latin America
5.4.5 Middle East and Africa
6. COMPETITIVE LANDSCAPE
*List Not Exhaustive
6.1 Company Profiles
6.1.1 Trimble, Inc.
6.1.2 Caliper Corporation
6.1.3 Descartes Systems Group Inc
6.1.4 ESRI Global Inc,
6.1.5 Google LLC (Alphabet Inc.)
6.1.6 Llamasoft Inc.
6.1.7 Microlise Group Limited
6.1.8 Omnitracs LLC
6.1.9 Ortec BV
6.1.10 Paragon Software Systems PLC
6.1.11 PTV Planung Transport Verkehr AG
6.1.12 Route4me LLC
6.1.13 Routific Inc.
6.1.14 Verizon Connect Solutions Inc.
6.1.15 WorkWave LLC
7. INVESTMENT ANALYSIS
8. FUTURE OF THE MARKET
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Frequently Asked Questions
What is the study period of this market?
The Route Optimization Software Market market is studied from 2018 - 2026.
What is the growth rate of Route Optimization Software Market?
The Route Optimization Software Market is growing at a CAGR of 10.9% over the next 5 years.
Which region has highest growth rate in Route Optimization Software Market?
Asia Pacific is growing at the highest CAGR over 2021- 2026.
Which region has largest share in Route Optimization Software Market?
North America holds highest share in 2020.
Who are the key players in Route Optimization Software Market?
Trimble, Inc., Caliper Corporation, Descartes Systems Group Inc, ESRI Global Inc,, Google LLC are the major companies operating in Route Optimization Software Market.