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Keeping Those Moving Vans Moving: Cort Furniture Rental's Washington D.C. branch struggled for years with manual processes. Dispatchers relied on printouts to calculate routes and posted updates on paper copies of each truck's manifest. But with hundreds of thousands of pieces of furniture to pick up and drop off each year, efficiency began to suffer and costs skyrocketed. "Our overtime hours soared and our fuel costs were way too high," says Tom Mattingly, director of operations at Cort's D.C. headquarters in Capital Heights, Maryland. The company decided to implement the Cheetah Delivery System by Cheetah Software Systems Inc. of Westlake Village, CA. It offers real-time optimized routing, delivery and dispatch in a package that's currently installed in hundreds of locations around the country. "By implementing Cheetah Delivery, we have reduced overtime by 27 percent in the first month and cut fuel costs due to having more efficient routes," says Mattingly. "It's great to have our managers managing instead of spending most of their days doing unproductive work or chasing pennies." Furniture Network Cort Business Services Corp. based in Fairfax, Virginia, trades under the name of Cort Furniture Rental. It has over 200 rental or retail locations nationwide offering a wide variety of furnishings, including residential and office in styles ranging from traditional to contemporary. Customers range from college students furnishing one room to Fortune 500 companies needing to fill an entire building. The company is divided into 54 districts, each semi-autonomous. The D.C. operation is by far the biggest in the country. Between the nation's capital and metropolitan Baltimore, its 135 employees look after 25,000 pieces of furniture that are housed in a 120,000 square foot warehouse. That adds up to 350,000 pieces of furniture picked up and delivered each year. 15 trucks ferry furniture between the warehouse, five clearance centers and hundreds of customer locations. Every day of the week, company trucks make four to five stops per day. Manual Dispatching is Too Slow While Cort's data center in Dallas provides much of the IT needs for its 54 districts, local branches still have IT matters to take care of. Mattingly, for example, has a local area network (LAN) running proprietary applications used in various parts of the operation. Unfortunately, neither the corporate nor local networks were set up to automate the complex dispatching and transportation side of Cort's operations. In D.C., dispatchers and transportation managers were left to cope with cumbersome manual processes. The corporate Oracle system printed out the orders based on a 6 p.m. cut off for deliveries scheduled for two days later. It took up to four hours to establish the best routes based on dispatcher experience. "We were totally at the mercy of the know-how of our dispatchers and transportation managers," says Mattingly. "Fortunately, we had a great crew, but a paper-based system consumed way too much time and was riddled with inefficiency." Once the routes were set, the warehouse staff spent much of the following day picking the various items and arranging them near the loading dock. The trucks were loaded up next morning in the necessary order for the following day's deliveries. Fine in theory, but a hundred variables could and did wreak havoc with this arrangement. Elevator availability, for example, could ruin an entire day. Some building managers dictate that furniture can only be delivered after hours, or during a one-hour window. But if a truck ran late and that window was missed, the driver had to rearrange his load mid-route and that delayed him further. In such cases, dispatchers scrambled to keep up. They wrote changes on pieces of paper in the dispatch office. This required constant phone calls between drivers, dispatchers and CSRs to sort out route changes, brief drivers and inform customers of delays. As the overtime hours mounted, profitability faltered. Rush orders were another random element. Cort allows next-day delivery for an extra fee. So well thought out routes could be nullified by several customers requesting rush deliveries or pickups. This could sometimes mean having to change the delivery structure for more than one truck as the load changes ripple through the routes. "Changes to the routes were the rule, not the exception," says Mattingly. "The whole system was too slow, relied on intuition and was monitored inefficiently over the telephone. I have never believed that a human can evaluate all the information needed to do the best possible job routing."
Automated Dispatch Improves Margins Accordingly, Cort automated its routing and dispatching operations using Cheetah Delivery. The company opted to use Cheetah's low-cost application service provider (ASP) model. Instead of purchasing all the hardware and software, Cheetah acts as an ASP using its own secure servers to host the logistics software for Cort. As well as greatly reducing costs, this approach provides for extremely easy implementation and rapid return on investment (ROI). It also enabled the company to implement an automated system without adding in-house IT staff. "It took a matter of a few hours to get the entire system running and the software downloaded to the drivers' phones," says Mattingly. "We're really happy to have the application hosted by Cheetah, it's working really well and we don't have to worry about it." Managers and dispatchers can now see graphically where each truck is on the assigned routes. If a delay happens, the system suggests alternative arrangements along with the impact they might create on other routes. Decision-making, therefore, is made easy. Instead of spending hours shifting around the various pieces of paper on the route plan, the system coordinates the variables so managers can determine the most optimum solution. Mattingly reports that the company has recorded its lowest ever total overtime hours in the months following the Cheetah implementation. Overtime is down 27 percent on average for the month. And in one recent week, overtime hours dropped 45 percent. Drivers know that the company views what they are doing and where they are going. If anything off route occurs, they are called immediately. At the end of the day, transportation managers use the information gathered to coach drivers on ways to save time and improve service levels. "Gone are calls from unhappy customers because our drivers failed to arrive at their final stop for the day due to delays," says Mattingly. "Since we know where our trucks are and identify problems well in advance, we can reroute vehicles more efficiently than ever." The system has proven so successful that Cort is using it as a competitive advantage. Mattingly has demonstrated Cheetah to the sales staff of the D.C. office so they understand how the system works and the advantages it gives them in servicing their customers. "None of our competitors have such a sophisticated system so we plan to loudly tell our customers about it," says Mattingly. "The return on investment and the increase in profitability from Cheetah Delivery has exceeded our expectations."
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