How manufacturers can create a more sustainable last mile

Supply chain professionals — particularly those in manufacturing — know how resource-intensive it can be to turn raw goods into products and move those products to their final locations. Transportation needs to be arranged at almost every stage of the process and the carbon emissions can begin to mount quickly. Case in point, Europe’s transportation sector contributes nearly a quarter of the continent’s total greenhouse gas emissions.

In the era of Industry 4.0 and Logistics 4.0, we’re better equipped than ever to quantify all of the ins and outs of the typical value chain, which is precisely how we know that last mile deliveries — which already generate the largest portion of CO2 emissions in the supply chain — are poised to increase 30 percent by 2030. As the UK works towards reducing carbon emissions and other green initiatives, how can manufacturers respond by powering more eco-friendly last mile logistics?

Step 1: Measure and establish a baseline

The first step to making the last mile more sustainable is to quantify exactly what your emissions baseline is for this leg of the supply chain. To do so, you need to know not just what routes are being driven, but what kinds of lorries or vans are being used and what their loads are.

Ideally, you’d be able to customise emissions based on those specifications. From there, you’ll want at least two different views of your CO2 output:

• CO2 emissions per stop: If you can visualise this easily during the routing process, you can more easily spot high-emission stops and work to find more efficient sequences.
• CO2 emissions per route: By gaining a more holistic view of how each route is contributing to your CO2 emissions, you can more easily understand larger trends in your sustainability efforts.

One of the concerns that manufacturers have expressed about decarbonisation is how they can actually demonstrate their carbon impact — these baseline measurements also lay important groundwork for that.

Step 2: Optimise routes

Since most CO2 emissions in the last mile come from fuel consumption, which scales linearly with miles driven, the most important task here is to find a way to drive fewer miles. This is where route optimisation comes in.

Powerful route optimisation has the ability to reduce miles driven by 10%, which directly results in a 10% reduction in emissions for a given route. This is an area where the fundamental inefficiency of the last mile of the supply chain actually presents a big opportunity for decreasing emissions. Transportation network structure can be a big factor in last mile emissions as well. Accenture recently discovered that an increase in local fulfilment centres in London — effectively shortening the routes that vans have to travel for each delivery — could actually reduce van emissions by 17% between now and 2025.

Step 3: Ensure transparency to customers

One of the reasons that the last mile is so difficult to optimise is that it is, in some ways, the leg of the supply chain that your business has the least control over. Why? Because it’s the first time you’re introducing customers into the equation.

All of a sudden, the risk of your plans going awry because someone simply wasn’t there to receive the delivery when the van arrived can skyrocket. Across the UK, 8% of deliveries fail on the first attempt, and increasing that percentage can have a huge impact on your carbon footprint—considering that each redelivery attempt involves driving all those miles all over again. That’s why enabling transparency for your customers is so critical to success.

If you can keep them informed of when the delivery is going to arrive and let them track van and lorry locations in real time, you can cut out the carbon emissions that come from redelivery attempts. In many cases, you can even get customers to explicitly choose more eco friendly delivery options if you let them know the carbon impacts of different options at checkout.

Step 4: Iterate over time

No technology is going to make the last mile of the manufacturing supply chain carbon neutral overnight. That’s why the ability to track your progress over time via streamlined reporting is crucial to decreasing your carbon footprint. When you can actually show measurable results over time, you can do more of what works and less of what doesn’t.

This also puts you in a position to show off your success to potential customers and partners. Studies show that consumers are increasingly making purchasing decisions based on factors like eco-friendliness. As pressure mounts on retailers and similar businesses to go green — potentially pushing them towards greener suppliers — manufacturers who prioritise engaging customers with greener deliveries now will be at an advantage as expectations continue to grow across the board.

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About the author

Alex Buckley is general manager of EMEA and Asia Pacific operations at www.DispatchTrack.com, a last mile delivery platform that powers positive, predictable, and visible experiences, and recently led their launch into the UK. Global and UK clients already using the platform include Furniture Village, Vision Logistics, Coca-Cola, and Walmart.

Alex is a CX industry expert with more than 25 years of e-commerce, SaaS, and software experience. Prior to DispatchTrack, he served as the Chief Customer Officer and Strategic Advisor for Customer Service Action. He has held a variety of executive roles at Notional, Zigy, Highstreet Mobile, Datorama, NetSuite, Klarna, Venda Limited and others. As UK Country Manager for Datorama, he oversaw the company’s $850m acquisition to Salesforce.

Find out how DispatchTrack worked with Vision Logistics to reduce the latter’s carbon footprint per delivery: www.dispatchtrack.com/learn/resources/vision-logistics