Yes, yes. We know it's a promo piece for ESRI and the utility of GIS. But the article below from ESRI's ArcNews also highlights the company-wide utility of GIS for journalists, at least those who understand that what we do requires a wider vision than just writing well. Additionally, the article illustrates in-house expertise that folks in the newsroom could consider tapping
ArcLogistics Payback Period Is 2.5 Months for Newspaper Company
The Star Tribune newspaper of Minneapolis-St. Paul, Minnesota, is using ArcLogistics GIS software to route its delivery drops. It is projected to save the newspaper more than a half million dollars in the next five years. By employing ArcLogistics in its efforts to serve the Minneapolis-St. Paul metropolitan region, greater Minnesota, and surrounding states, the Star Tribune has found that using GIS technology for intelligent routing has delivered an economic advantage to the company.
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Using ArcLogistics, Star Tribune staff found that the existing newspaper delivery routes could be more efficient because some delivery trucks were unnecessary. |
Given current economic trends, the company began looking for new areas where the newspaper could save money. Traditionally, the newspaper used wall maps with pushpins to determine delivery routes for single-copy papers. Rerouting was a time- and labor-intensive activity that required three employees from multiple departments to sit in the map room for four hours a day over the course of a month. Determining new routes is a necessity each time one of the seven advertisement zone boundaries is shifted or when a threshold amount of new or removed newspaper drop locations is reached. After reviewing several options to increase the efficiency of delivery routes, the Star Tribune partnered with Truck Dispatching Innovations, an ESRI Business Partner from Chicago, Illinois, to implement ArcLogistics. After a two-week startup period geocoding more than 3,700 delivery drop points and the routes of 39 trucks, employees used GIS to create new routes. These outcomes had many benefits. Using this new methodology, one staff member inputs a list of delivery route changes into ArcLogistics and, in half the time of the traditional method, creates and shares maps displaying new routes. The staff perform what-if scenarios, such as including different ad-zoned papers on the same truck. These reveal route options that could further increase the efficiency of delivery routes.
The Benefits of ArcLogistics
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With the analytical tools of ArcLogistics, staff are able to decrease the number of delivery trucks on each route. |
The Star Tribune expects a payback on its investment in 2.5 months and a five-year net savings of $672,740. This positive return on investment provides evidence showing the success of the venture to the company's financial director. The Star Tribune analyzed the benefits of its investment in ArcLogistics by measuring fixed and variable costs. Fixed costs include the lease price and maintenance expenses for delivery trucks, as well as the initial cost and yearly maintenance of the software. One variable cost is the number of miles driven, which determines gas costs per route. Another variable cost is the number of hours driven, which determines the wage cost per driver per route. Fixed costs are added to variable costs to determine route costs. Combining cost savings in these four areas shows a more accurate cost savings, rather than just looking at the savings as stand-alone figures. The Star Tribune found significant savings of route costs, including the number of trucks needed, miles driven, and time spent delivering newspapers.
More Information
For more information, contact Al Olson, fleet logistics manager, Star Tribune (e-mail: aolson@startribune.com), or John Handler, principal, Truck Dispatching Innovations (e-mail: jhandler@TDInnovations.com). To learn more about ArcLogistics, visit www.esri.com/arclogistics.
