This is the second article in a series on sustainability in last-mile delivery.
Last mile delivery may cost a lot for companies that have goods and services that need to be delivered, but its cost to the environment is far greater.
Transportation as a sector is the single largest contributor of greenhouse gas emissions in the U.S., standing in at 28.9%. And with all its benefits, the recent revolution in transportation models has only aggravated the issue.
One recent scientific study stated that Uber and Lyft are responsible for more than half of San Francisco’s rise in traffic congestion. Often carrying only one passenger, these inefficiently-filled vehicles clog the roads and are massive contributors to our global carbon footprint.
Delivery needs to be greener, but it doesn’t have to be a costly burden. In fact, an environmental focus goes hand-in-hand with efficient delivery operations.
Here are five ways to ensure that your delivery operations are as eco-friendly and efficient as possible:
5 ways to mitigate the carbon footprint caused by delivery:
- Optimize routes
- Use zero-emission transportation
- Manage resources efficiently
- Use in-store inventory (delivery from store)
- Incentivize eco-friendly delivery options
Optimize delivery routes
It’s simple: the less mileage your drivers consume on the road, the lower your contribution to greenhouse gas emissions.
With effective route optimization, drivers reach more stops per run while covering fewer miles when compared to a less-than-optimal route.
Route optimization is an important first step on the road towards creating greener delivery operations, but it’s just a starting point. Make sure you first understand the logic behind route optimization software, as well as their benefits and their limitations.
Use zero-emission transportation
The ever-growing fulfillment demands and the associated increase in delivery costs are driving businesses to get creative with zero-emission forms of transportation.
Drones, delivery bots and autonomous electric cars could put a stop to delivery-related emissions, especially for same-day delivery. Fedex, for example, is trying to tackle the issue of same-day delivery with a battery-powered delivery bot that can easily maneuver on sidewalks and quickly get orders to customers.
More and more metropolitan fleets are also encouraging their providers to bike to work; almost all Postmates couriers in New York city deliver on foot or by bike.
The bike option is also being pushed on the legislative level, with bodies like the Ministry of Transportation in the UK deciding to subsidize electric bikes for delivery providers and brands making last mile deliveries.
So switch out your gas-dependent trucks and cars for clean, green transportation options such as electric or hybrid vehicles, and the old-fashioned bike for local deliveries whenever possible.
While it’s important to reduce the reliance on gasoline, the only way to truly tackle the environmental delivery conundrum is to target efficiency on a broad scale, across the entire delivery flow.
Manage resources efficiently
Every enterprise at any scale can reduce its delivery-related emissions through more efficient delivery processes. However, companies that manage on-demand deliveries will face different challenges compared to those that stick to planned deliveries.
With planned deliveries, time is on your side. Dispatchers can ensure ahead of time that all trucks or other modes of transportation are filled to capacity, and use route optimization to make sure that drivers do as few runs as possible.
If dispatchers and drivers can communicate during the run, and the dispatcher has good visibility into returns, then the same delivery trucks can also perform returns while they’re on a delivery run. This saves time and money for both the customer and the company – and it’s a great customer experience as well.
On demand delivery
While urgent SLAs leave minimal room for route optimization, there are other ways to keep on demand delivery eco-friendly, starting with making local deliveries by bike or on foot.
Automated batching tools can ensure that a single run can include multiple orders going to the same area, even if they are ordered separately, and even if they are placed at different times.
For example, if one group of employees orders lunch at 11:30pm with a one-hour SLA, and another group of employees from the same company or building orders at 11:55, a point-of-sale system that is integrated with an automated batching solution can delay the first order until the second one is ready to go as well. This ensures that you don’t deliver twice to the same area around the same time, and saves the company money as well as time (and gas) spent on the road.
Aggregators like Uber Eats do this by providing incentives to add orders to existing ones for a discount. This incentivized batching reduces delivery fees for the delivery provider, as well as the order cost and waiting time for the customer.
Use in-store inventory (deliver from store)
If companies have inventory visibility and a healthy integration between inventory data and order data, they can offer delivery directly from a local store.
In a recent study, Rakuten Intelligence reports that the average domestic package travels over 1,000 miles before arriving at its destination. This is astonishing when you consider that the same item may be available at a retail location just a few miles away from the customer.
‘Hyper-local’ deliveries from local brick-and-mortar stores and dark stores not only drastically reduce the carbon footprint per order, but also help by getting rid of inventory with a short shelf life. Grocery chains and fashion retail chains in particular can increase their revenue using the deliver-from-store model.
Think about it: If pizza shops can offer 30-minute deliveries to local customers, why not retail stores?
In combination with bike couriers and delivery providers on foot, hyper-local deliveries can save hundreds of miles of vehicle-related expenses, while offering brands a way to get a competitive edge in their market.
Incentivize eco-friendly delivery options
On-demand delivery is incredibly wasteful, with couriers delivering a single item in a vehicle that could easily fit multiple packages from multiple vendors headed to multiple locations. Yet while on-demand delivery is almost decadent in its waste of resources and inefficiency, it’s not as necessary as you may think.
Believe it or not, many customers will choose to save money and get their order a bit later. According to an Accenture Strategy report, 36% of online shoppers are happy to wait longer for free delivery. Even moving an order from same-day to next-day delivery gives time for more optimized dispatching and routing, and generally results in lower costs for the business.
Incentivizing planned delivery is a triple win: The customer pays less, you pay less, and the environment pays less.
With so many ways to reduce your carbon footprint, it’s important to first decide on a business strategy; it could be to build deliver-from-store operations, route optimization, integrating with a bicycle fleet, or a host of other options.
Enterprises that target operational efficiency through eco-friendly delivery tactics will find that it pays to be green.