When companies begin exploring delivery management software, one of the first questions asked is about cost.
After realizing the software handles many tedious delivery and logistics tasks, the cost calculation looks much more appealing.
However, there is a wide range of options to review, and the cheapest software may not be the most lucrative.
In this article, we’ll look at the many aspects of the cost of delivery management software.
What Is Delivery Management Software?
Delivery management software automates and simplifies the delivery process.
Instead of managing orders, drivers, scheduling, and logistics across several disparate systems, you can consolidate these functions into a single delivery tracking app.
Some features of delivery management software may include:
- Order management
- Driver management
- GPS tracking
- Optimization of delivery routes
- Automated customer notifications
- Proof of delivery
- Scheduling
- Performance reports
- Driver mobile apps
A delivery tracking app for small business can streamline the complicated process of delivery tracking and management.
What Determines the Cost of Delivery Software?
Unfortunately, there is no universal cost for delivery management software.
Every company has different needs depending on the total number of drivers, the deliveries, required features, automation levels, and more.
We’ve listed some of the most common price influencers below.
1. Total Number of Drivers
The number of drivers is one of the most frequent influencing factors.
Five drivers typically require a much lower subscription than 100 drivers.
Some companies base the cost on the number of drivers, while others sort by the number of delivery orders, or the number of deliveries you make monthly.
If you are unsure how many drivers you’ll have in a year, estimate the number and choose the software plan that suits your needs best.
2. Total Number of Deliveries
The total number of deliveries is also an influencing factor.
Some software plans allow you to choose how many deliveries you make every month, and you sort the cost based on the number.
If you operate a local delivery service while another company handles thousands of deliveries every week, the cost will undoubtedly be different.
The number of deliveries can increase with your business, so it’s essential to review your current and future projections when choosing delivery management software.
3. Features
A higher number of features typically corresponds to a higher subscription cost, but not all of them might be required for your business.
For example, small-scale delivery services may only need the following features:
- GPS tracking
- Route optimization
- Order assignment
- Driver communication
- Delivery confirmation
Larger logistics companies might benefit from more advanced delivery tracking software that offers automated dispatching, scheduling, route optimization for multiple delivery areas, driver fleet management, API access, and multi-stop routing.
4. Level and Quality of Automation
The level and quality of automation can affect software subscription prices.
For example, some applications include automated dispatching while others require a person to assign deliveries to drivers.
If you work for a delivery company and manage the drivers personally, you may choose the cheapest plan since you will be handling most of the logistics tasks anyway.
What Is the Cheapest Software for Small Business Delivery Tracking?
Small-scale delivery services often believe that delivery management software will be unaffordable.
A delivery tracking app for small business doesn’t have to be unreasonably expensive.
In fact, some delivery services with small teams of drivers benefit most from using delivery tracking software.
Managers can spend fewer hours calling drivers, assigning orders, and chasing late deliveries when automation handles some of these delivery logistics tasks.
For small companies, the most crucial factor should be how much time and money the software can save, not how much the subscription costs.
If the delivery app for small business saves you a few hours every week, the value depends on how much you earn per hour.
Hidden Delivery Costs of Manual Processes
The software subscription cost may be a considerable expense.
However, companies often forget to calculate the cost of managing delivery manually across multiple systems and apps.
Think about the time and effort spent managing the following delivery logistics tasks manually:
- Assigning orders to drivers
- Providing directions to drivers
- Updating customers on delivery status
- Investigating missing or stolen deliveries
- Managing fuel or gas consumption
- Addressing customer concerns
While these expenses may not be as apparent as the software subscription, all of these delivery logistics tasks require resources to complete successfully.
You can reduce the time, effort, and money spent on delivery logistics management by automating these processes with delivery management software.
Fuel Costs and Route Optimization
Fuel costs are often one of the largest expenses for any delivery company.
Route optimization plays a significant role in reducing costs and cutting unnecessary driving.
Route optimization logistics software looks at all the addresses that need to be delivered to and determines the most efficient delivery route.
Even slight improvements in delivery route efficiency can have a substantial impact on the amount of fuel consumed if you make hundreds or thousands of deliveries every week.
Besides reducing operational costs, route optimization software also helps you save money by reducing fuel consumption and the likelihood of delays.
Improved Customer Experience Has a Monetary Value
Most customers today expect the ability to track their deliveries in real-time.
The inability to do so may result in customers asking for updates via phone or email.
Asking for delivery updates can become extremely tiresome if these questions come in hundreds or thousands every month.
A delivery tracking app can be used to update customers on the progress of their deliveries.
An improved customer experience leads to more satisfied customers who are likely to become repeat buyers. As a result, improving customer experience has a monetary value.
Extra Charges and Expenses to Consider
When comparing subscription plans between delivery management software providers, keep an eye out for additional charges and expenses.
Some companies add extra costs for:
- Extra drivers
- Extra deliveries
- GPS tracking
- SMS
- API access
- Third-party software integration
- Setup and installation
- Premium customer support
- Extra users
A cheaper-looking option can be much more expensive when you add the additional delivery logistics expenses.
Always calculate the expected monthly cost of using the product based on your individual or company needs.
Cost Versus Value Ratio
The most important metric for choosing the best delivery management software is the cost versus value ratio.
Calculate how much delivery tracking software can reduce your spending on delivery logistics tasks.
You can begin by reviewing how much you spend on:
- Manual order assignment
- Coordination and communication with drivers
- Gas or fuel consumption
- Lost or stolen deliveries
- Customer support and complaint resolution
- Administrative tasks and documentation
- Delivery disputes
Next, consider the value that technology can bring to your business.
A more expensive option might be the best choice if a lower-cost delivery tracking app would cause you to waste more time and resources.
Final Thoughts
When looking at the cost of delivery management software, remember that the value it provides extends far beyond the subscription price.
A delivery tracking app for small business can allow you to perform tasks that only large logistics companies could afford.
On the contrary, as your business grows, you may require more features from delivery tracking software.
Before making a purchase, review the number of drivers, deliveries, features, value, and future growth projections.
Finally, remember that the best delivery management software should save you time and money instead of costing you extra.
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