A pharmaceutical distributor · South Africa
Last-mile delivery brought in house
R5.97M
saved annually, around 35%
977
customers modelled as one network
530,829 km
of road network modelled
98.6%
of drops reachable same-day
8
vehicles in the recommended fleet
The problem
A pharmaceutical distributor was serving 977 customers from two distribution centres through an outsourced courier arrangement whose cost was rising. The question was whether running the fleet themselves would be cheaper, and if so, what that fleet should look like.
What we did
We modelled both distribution centres as a single combined network rather than two separate problems, which is what allowed the boundary between them to be optimised rather than assumed. The underlying road network ran to 2,606,875 edges spanning 530,829 kilometres, incorporating 3,099 turn restrictions and 393 priced toll edges, so that the cost of a route reflected what it would actually cost to drive.
What we found
An in-house fleet of eight vehicles and eight drivers, rostered in compliance with South African labour regulations, delivers the same service for R5.97 million less per year — a saving of roughly 35% against the outsourced baseline.
We also tested electrification honestly rather than optimistically. On the then-current generation of vehicles, 98.6% of drops were reachable same-day by conventional vehicle against 71.3 to 73.8% by electric vehicle. That gap gave the client a defensible basis for phasing the transition on specific routes as vehicle range improves, instead of committing the whole fleet prematurely or dismissing electrification altogether.