VERITICO FLOW

Once you reach a higher transported volume through your network, you need to start planning your distribution. The efficiency and resilience of your distribution can make or break your bottom line and either support your business’s growth or stand in its way.

VERITICO FLOW allows you to perform complex simulations on a scale to verify the proposed solution’s suitability and evaluate it against specified KPIs. After you create a model of your current distribution network, simulating new scenarios takes only a margin of additional time, allowing you to search through many possibilities until you identify the best one.

VERITICO FLOW is a powerful engine that allows you to simulate a network of any configuration, but a higher demand for user inputs accompanies this flexibility. In addition to the underlying core software, we offer a customized interface and optimizer, allowing you to model and find the best strategy for your needs easily.

Distribution Strategy Planning

In today’s fast-paced market, an effective distribution strategy is vital for any business. Surprisingly, nearly 60% of a company’s success can be attributed to its distribution network efficiency. This means that a significant portion of revenue hinges not just on what you sell, but how and where you distribute it.

Distribution channels are often overlooked for many products, with some companies relying on outdated or inefficient methods. This leads to bottlenecks, delays, and ultimately, lost sales opportunities. Nearly half of all distribution strategies fail to align with the company’s overall goals, resulting in fragmented efforts and reduced profitability.

The key to unlocking full market potential lies in strategic distribution planning. This involves not only selecting the right channels but also optimizing logistics and supply chain operations to meet customer demand swiftly and efficiently. By leveraging data-driven insights and integrating them into your distribution strategy, you can ensure that your products are always at the right place, at the right time. This not only boosts sales but also enhances customer satisfaction and loyalty. Remember, in the world of distribution, it’s not just about moving products, but moving them smartly.

Examples of use cases addressable by FLOW

The fundamental problem that companies face is the topology of the distribution network. The objective of this problem is first to identify the optimal number, location, and function of each distribution node. The function of a node can be a distribution center (DC) or a cross-dock, for example. The objective can be achieved by simulating the different distribution network scenarios considered in FLOW and then evaluating the associated logistics costs. The most suitable topology can be selected based on analyzing each scenario’s KPIs and the business context knowledge. The figure below illustrates the problem of choosing a new distribution center.

Each company operating multiple distribution centers (DCs) decides which customers to serve from which DC. Segmentation is a complex issue that translates into operational efficiency of the entire distribution network, customer satisfaction, and other aspects. The problem cannot usually be solved simply by allocating to the nearest DC, as synergies in the shipments of different customers can often compensate for the relatively greater distance from a given DC. Again, this raises the need to simulate the actual operation of the distribution network. FLOW allows modeling of the network operation costs for different customer segmentation alternatives between different DCs. The segmentation whose cost and service level best match the company’s requirements can be selected by analyzing the resulting KPIs. FLOW can thus answer a question like the one illustrated in the graphic below.

The pricing of services to individual customers is a vital issue that is not only addressed by freight forwarders. By calculating the distribution routes, it is possible to determine for each customer what its relative cost-effectiveness was, taking into account the frequency and volume of loading, the total cost of the route, and its distance from the DC. This then allows a pricing policy to be set that respects the actual costs of each individual customer, which translates positively into the margin of each customer. FLOW answers these detailed questions by an appropriate choice of simulated scenarios.

Companies whose product portfolio consists of multiple segments, as in the case of fresh and dry grocers, are faced with the decision of where to ship which products to a given customer. This task may seem simple at first glance, but in reality, it is a very complex task with many factors. Correctly linking and considering these factors usually leads to many alternative scenarios that must be considered for a correct evaluation. The results of these tasks cannot be determined intuitively, and the whole task hides considerable potential. The graphic below illustrates the problem.

The term FTL (Full Truckload) refers to full truckloads, and LTL (Less Than Truckload) refers to less than full truckloads. FTL/LTL management is concerned with finding the optimal distribution of FTL/LTL shipments by distribution region and customer, optimizing delivery schedules, and fleet management. FLOW enables the simulation of individual FTL/LTL transport scenarios, considering all key parameters such as frequency and volume of shipments, shipment destination, product specifics, and other specific transport conditions. At the same time, FLOW can provide the optimization algorithm with different vehicle variants for the available fleet. This allows the optimizer to select the suitable vehicles for the simulated problem. The configurations best suited to the company’s needs can be chosen by analyzing the FLOW outputs for different scenarios. This situation is illustrated below.

All of the specific cases described higher can be loosely classified under distribution network optimization as such. Examples of parameters reflecting the efficiency of the network are shown below. The optimization aims to discover the cause of the problems shown and to propose steps that will lead to their elimination and, thus, an increase in efficiency. The benefit and the specific form of each step can be defined using FLOW, which enables consultants to estimate the benefit of all the measures considered accurately.

Distribution network simulation

Distribution network simulation is an essential tool in the modern business landscape, where efficiency and precision are paramount. It is estimated that optimizing distribution networks through simulation can reduce logistical costs by up to 10%, a significant margin in any industry.

Integrating distribution network simulation into your strategic planning opens the door to a world of possibilities. These simulations allow diligent testing and evaluation of various distribution scenarios without the risks and costs associated with real-world experimentation. Businesses can anticipate potential challenges, adapt to market changes swiftly, and optimize routes and inventory levels. This not only ensures a more resilient supply chain but also leads to increased customer satisfaction and loyalty. In essence, distribution network simulation is not just a tool for efficiency; it’s a roadmap to a more adaptive and successful business model.

FLOW Customization

FLOW is a powerful engine capable of simulating a network of any configuration, providing users with exceptional flexibility. To simplify this experience, we offer a customized layer built with Microsoft Power Apps. This additional layer enables the creation of tailored applications that suit specific customer use cases, allowing for an intuitive and optimized interface to model and identify the best strategy for your unique needs.

FLOW in Scientific Research

Veritico Flow empowers researchers in logistics and optimization tools designed specifically for large complex Vehicle Routing Problems (VRP). This platform supports the exploration of various VRP variants, including Capacitated VRP, VRP with Time Windows, Multi-Depot VRP, Open VRP, and more. Its comprehensive capabilities enable users to model many scenarios and simulate diverse problem variations, establishing Veritico Flow as a valuable resource for academic exploration. The software has already been applied in published research, demonstrating its impact within the academic community.

The simulation engine facilitates the creation of detailed, multifaceted models, allowing for extensive scenario analysis that aids researchers in validating hypotheses. This functionality makes Veritico Flow an essential tool for those looking to progress their work in operational research and logistics optimization.

Veritico Flow in Education

FLOW supports hands-on teaching, providing educators with the tools to integrate practical logistics challenges directly into their lessons. With pre-prepared demo datasets and teaching materials, instructors can create engaging, real-world simulation experiences that deepen students’ understanding of logistics and optimization. Veritico Flow offers academic licenses, enabling universities to incorporate high-powered tools into their curriculum and prepare students for real-world applications. Additionally, our team can provide specialized lectures or workshops to enrich the learning experience, offering students direct insights from experts in logistics and optimization.

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