Time to deliver: building sustainability into the e-commerce supply chain

(Image credit: Image Credit: Snowing / Freepik)

E-commerce has enjoyed a meteoric rise over the last decade, with more and more consumers preferring to shop online rather than head out to the high street. This has led to a greater number of parcels being delivered to homes and offices around the country, meaning there are now more delivery vehicles on the roads than ever before. As a result, congestion and transport-related carbon emissions have increased significantly—particularly in cities with large populations that are no strangers to busy transport systems and grid-locked roads. From a sustainability point of view, the impact is considerable. The emissions produced by idle vehicles as they sit in traffic is now one of the greatest causes of pollution, with the continuing growth of the e-commerce industry making it a challenging issue to address.

This is why reducing the environmental impact of online shopping is now such a prevalent issue. Various initiatives have already been put in place in order to reduce the number of vehicles on the roads and encourage businesses to embrace cleaner alternatives, such as the introduction of London’s Ultra Low Emission Zone. However, there is a wider challenge facing e-commerce businesses that makes prioritising sustainability difficult. Online retailers must meet consumer expectations around same-day and next-day deliveries and stay afloat in the hyper-competitive market, whilst also taking steps to increase their sustainability. So, how can e-commerce businesses navigate this issue and help build a more sustainable supply chain?

Fewer trips, bigger impact

One potential option for businesses is to roll out more sustainable mobility solutions such as electric vehicles, which have been touted as a viable way to reduce the amount of emissions produced by drivers in the future. However, while this will have a positive impact on pollution, the adoption of electric vehicles will not solve the congestion issue. Challenges such as the sheer quantity of deliveries and the frequency of failed deliveries therefore also need to be taken into account. For example, a significant number of online orders are not delivered at the first attempt, increasing the cost and time requirements for the retailer and courier while also contributing to emissions. To address this issue, it’s important to minimise the number of miles travelled by each courier in a way that reduces the amount of time they have to spend waiting in traffic or searching for parking spaces, without affecting the number of packages they are able to deliver. This is where the use of secure and automated parcel lockers comes into play.

Parcel lockers create a direct and clear route between retailer and consumer, while ensuring that deliveries spend less time in last mile transit. Couriers only have to deliver to a handful to lockers instead of hundreds of separate destinations, which reduces the complexity of the last mile and cuts the emissions produced by vans driving between homes to deliver individual packages.

From the point of view of the consumer, lockers add convenience by letting them choose when they want to collect their parcels, ensuring that deliveries are made at the first attempt. In turn, this reduces the number of failed deliveries for retailers – which research from Loqate, a GBG Solution suggests occur 5.6 per cent of the time. When put into the context of the four billion UK packages that are predicted to be delivered in 2021, the significance of this saving is made clear.

Attract environmentally conscious customers

One change we’ve seen in recent years is that consumers are becoming more interested in making environmentally friendly decisions when it comes to their purchasing habits. For example, eight in ten consumers are trying to reduce their plastic waste and half are willing to pay higher prices for eco-friendly packaging, highlighting the consumer’s shift towards being more conscious about their impact on the environment. E-commerce businesses have an opportunity to tap into this mindset by helping to build more sustainable supply chains. Although this alone may not be enough to motivate a consumer to make a purchase, it is likely to drive long-term brand loyalty and resonate with the growing number of environmentally conscious consumers.

This could have a major impact in today’s hyper-competitive marketplace, where retailers are constantly on the lookout for new ways to attract and retain consumers. Offering greener delivery options such as parcel lockers at the checkout is a simple way for online retailers to differentiate themselves from their competitors.

Of course, there’s no silver bullet solution to transforming sustainability in the e-commerce supply chain. However, parcel lockers have proven that they are able to address many of the biggest last mile inefficiencies—from reducing traffic congestion, to minimising the number of destinations for couriers and creating a direct route between retailer and consumer. Over the coming years, it’s clear that parcel lockers have a key role to play in helping retailers build a greener and more sustainable e-commerce supply chain.

Jason Tavaria, CEO InPost UK