A white-glove delivery operation losing $1,156 on 13 orders — and the fix isn't routing, it's pricing.
White-glove furniture delivery · 13 customers · Bay Area · a national luxury furniture retailer
Service standard is fixed: no split orders · full install + staging + cleanupThe operation, the loss, and the answer — in one screen.
Optimize routes, truck loading, and the daily schedule for 13 customers — then answer whether flat-rate delivery fees should change, by how much, and why.
$6,043 in cost against $4,887 in fees. Eight of thirteen customers lose money; the five smallest orders subsidize the rest.
Volume-based pricing at $150 + $0.25/cu ft — or +$88.94 per delivery on flat fees. Bigger truck as the capital lever: it flips the loss into a $508 profit.
How the optimization was structured — and what was deliberately not optimized.
Group customers by proximity to minimize travel between stops — six Bay Area clusters around the SF SOMA warehouse.
Bin-pack orders into the 1,700 cu ft truck without splitting any customer's order across loads.
Assign loads to days inside the 540-minute (9-hour) work window, keeping 3 loads per day.
| Constraint | Value | Binding? | Impact |
|---|---|---|---|
| Daily work window | 540 min (9 hrs) | YES | Limits loads to 3 per day |
| Truck volume | 1,700 cu ft | YES | Requires 21 loads for 26,369 cu ft |
| Truck weight | 7,000 lbs | NO | Volume fills first in most loads |
| Operating days | Tue–Sat | NO | 7 working days span two weeks |
| Service standard | White glove, fixed | YES | No split orders, no rushed crews — rules out cost-only moves |
The 7-day schedule: 21 loads, every day inside the work window.
| Day | Loads | Travel | Service | Total | Miles | Buffer | Status |
|---|
Buffer = 540-minute window minus scheduled travel + service. Days 1–3 run tight — they carry the reschedule risk.
Six geographic clusters around the SF SOMA warehouse. Select a day to see its route; same-day stops stay inside one cluster.
Where the money goes — and what the flat fees cover.
Defaults are the case-documented values. Every figure on this page recomputes live.
Three alternatives tested against the base case — tune the inputs and watch the verdicts move.
| Metric | Base case | Speed | Luxury | Capacity |
|---|
Speed: parallel crews, 10% coordination overhead per truck, 15% deadhead fuel per extra truck. Luxury: 7.5 hrs/day at premium pace. Capacity: fewer trips in a bigger truck.
Should flat-rate fees be reviewed?
+$88.94 per delivery to break even — local becomes $387.94, extended $487.94. Simple, but it doesn't address the volume disparity.
$150 + $0.25/cu ft. A 276 cu ft order pays $219; a 3,970 cu ft order pays $1,143. Aligns price with actual delivery cost.
| Customer | Volume | Zone | Current | Proposed | Change |
|---|
The spreadsheet plans the week. Running the day takes a system — for the dispatcher, the salesperson, and the driver.
+----------------------------------------------------------+ | DELIVERY OPERATIONS | +----------------------------------------------------------+ | | | +----------+ +----------+ +----------+ | | | PLANNING | | DISPATCH | | SALES | | | | (weekly) |----->| (daily) |<---->| (quote) | | | +----------+ +----------+ +----------+ | | | | | | | +-----------------+------------------+ | | | | | v | | +--------------------------------------------------+ | | | SHARED DATABASE | | | | orders · truck GPS · buffer remaining | | | | pricing rules · reschedule history | | | +--------------------------------------------------+ | +----------------------------------------------------------+
iPad/POS plugin — salesperson enters cubic feet, gets the price instantly.
$150 + ($0.25 × volume)
Surcharges: stairs +$50 · expedited +$150 · assembly +$100
Live truck locations, buffer remaining per day, one-click reschedule, overtime alerts.
Buffer signal: >60 min · 30–60 · <30
Navigation plus three exception buttons — the driver taps, the system handles the logic.
Traffic delay → ETAs update · No answer → wait timer starts · Reschedule → logged, new slot found
Working calculators built on the same cost model.
Rule: 15-minute increments, round up at 7+ minutes. Rate: $104/hr.
· 1st reschedule: free
· 2nd+ reschedule: $75 concierge fee
· No-show: $75 fee + next available window
Wasted trip cost: $208 (2 hrs × crew rate) — the fee covers a third of it; the rest is the price of the promise.
Total cost: $6,043 · Labor 92% ($5,564) · Fuel 8% ($479)
Loads: 21 · Days: 7 · Miles: 396 · Utilization: 74%
"This is a pricing problem, not a routing problem."
"Delivery is a cost center, not a profit center — at current prices."