City logistics is a complex playing field with a multitude of actors involved. Increasing efficiency and greening last-mile logistics can only be achieved if all these actors play their part, governments included. This is how to get started.
First things first: Focus on Getting the First and Last Mile Right
If you’ve read the article on the challenges of last-mile logistics, you might already know that something needs to be done. Both in terms of efficiency and sustainability. The first and last mile are neither the sole nor the major source of emissions in transportation. Yet, regarding the total distance covered by a parcel, this last mile still causes major problems. And not just that, it’s the most visible part of the whole logistics process. It’s what happens right in front of our eyes.
Rob King, Co-Founder of Zedify, put it in a nutshell: “If you can get the first and last mile sorted, then everything else is actually relatively straightforward and relatively efficient.” In that sense, let’s focus on what cities and logistics companies can do to get this part right. Because ultimately, it’s not just about traffic. It’s about life in cities.
It’s one thing to say that companies need to change the way they deliver goods, shift towards zero-emission vehicles, bundle goods where possible and increase efficiency. But that won’t be sufficient if cities fail to implement regulations that accelerate and facilitate this transition too. Here is one possible way how to get started.
Create an Environment for Better Goods Transport.
Around the world, more and more governments are taking steps to keep polluting and unsustainable delivery vehicles out of their cities. Among others, Shenzen implemented a green delivery zone in 2018, Rotterdam officially announced the implementation of a zero-emission freight zone by 2025 alongside other Dutch cities, and even the first US city, Santa Monica, has recently introduced a voluntary green delivery zone in the city centre.
This is an important and much-needed step. Because currently, several actors in the field of logistics feel that governmental policies don’t go far enough. As Birgit Hendriks, Co-Founder of Binnenstadservice, puts it in a nutshell, “What we really need are stricter rules by the government. Companies are not going to change the way of delivering their stuff automatically just because we are there at the edge of the city”.
And it’s true. Responsibility does not lie solely with the shippers, logistics companies, entrepreneurs or consumers. Local and national governments can contribute substantially to better goods transport, more efficient and sustainable deliveries, too. They only need clear strategies and new forms of cooperation.
As mentioned before, one possible way is to implement low- or zero-emission delivery zones. Depending on the exact design of such a zone, only zero-emission vehicles, e.g. electric vehicles or cargo bikes, are allowed to enter the zone, while other vehicles are banned from entry or have to pay a fee. ZE-zones often come within a larger ecosystem of regulations and should not be considered separately.
Cities that are planning to implement a ZE-zone should consider some kind of transition period to allow companies to adapt to the new regulations. This can be in the form of a step-by-step expansion of the zone, starting with a single street, a certain quarter or the historic centre of the city and gradually enlarging the area where the rules apply. A strategy might also include financial or non-financial incentives that facilitate the transition to ZE-vehicles for companies, or the provision of necessary charging infrastructure.
Ultimately, cities shouldn’t underestimate the power of data and stakeholder involvement. The first, to understand current challenges, define objectives and evaluate the degree of success of a green delivery zone. The latter, to understand the obstacles companies are facing and their needs, to increase the acceptability of and compliance with the measures.
Collaboratively for Consolidated and Green Deliveries.
While governance and leadership form the base layer of a successful transformation of last-mile delivery, it’s the operational aspect that needs to change too. The two magic words in this context are consolidation and collaboration. To increase both the efficiency and sustainability of logistics, new forms of collaboration can lead to increased load factors and reduced vehicle kilometres. In the end, it should be the goal to keep half-empty trucks from entering the city and driving to different addresses within the city, causing well-known problems.
There are several ways that this issue can be addressed.
- Urban Distribution Centres or Urban Consolidation Centres (UCC): Having some sort of hub close to the city centre allows carriers and 3PLs (Third Party Logistics Providers) with less than truckload deliveries to drop off these goods at the UCC. They are then grouped according to the delivery address and delivered to the final address via green transport mode. Having a network of these hubs across the country, such as in the case of Goederenhubs (NL), can be even more attractive for shippers which operate on a national level.
- Micro hubs, micro depots or cycle logistics hubs: Every sort of hub located closer to the consumer than the average warehouse, distribution centre or depot is valid since it enables the use of ZE-vehicles for the delivery or pickup of goods. These hubs can be temporary or permanent, mobile or stationary, depending on the business model and options at hand. As for the question of location, apart from parking lots in city centres, some more creative concepts have been trialled too, such as using public transport facilities for logistical operations.
- Pick-up stations, parcel lockers and similar installations: One important goal is to provide the consumer with great flexibility while at the same time keep the number of failed deliveries to a minimum. One possibility is to install more pick-up stations or parcel lockers that allow consumers to pick up their deliveries at a time they choose (preferably by bike or foot). That way, a second delivery attempt can be avoided and unnecessary vehicle kilometres reduced to a minimum.
From the set-up of a UCC to the implementation of a micro hub, collaboration is key in all these efforts. Whether it’s 3PLs using services of a UCC, a CEP company collaborating with the operator of a cycle logistics hub, or bike couriers collaborating with a logistics company that also provides the bike couriers with the necessary IT platform – all of them are more successful when working together. That way, each can focus on what they can do best and thereby contribute to the common goal of making last-mile delivery more efficient and greener too.
In a Nutshell
Ultimately, it’s on every one of us to make a difference. The government in its role both as a facilitator and consumer, shippers, logistics companies, retailers and every individual as a customer. We are all involved in this system.
Each decision – may that be a company transitioning towards a ZE-vehicle fleet, an individual redirecting a parcel to a pick-up station knowing that he or she won’t be home at the scheduled delivery time, or a city implementing a green delivery zone – is a step into the right direction. However, if we want to make even bigger steps, leaps, we have to join forces.