Climate change warnings and last mile delivery

posted by Paul Yewman
15 October 2018

As the dire findings of a landmark report from the United Nations’ scientific panel on climate change hit the news headlines, I’ve been grappling with an impasse of sorts.

On one hand, irrefutable scientific evidence indicates the need for drastic measures. On the other hand, we are living in a world where customer demands for convenience, control and lower cost continue to drive the upswell of delivery vehicles (and congestion) on our roads.

Coral Davenport, environmental policy and climate change correspondent for The New York Times described the level of change required as “transforming the world economy at a speed and scale that has no documented historic precedent”.

The report, the first of its kind issued by the Intergovernmental Panel on Climate Change (IPCC), a group of nearly 100 scientists convened by the UN in response to the 2015 pact to fight global warming, opens the doors to an onslaught of possible solutions.

For many, the answer is to put a price on carbon. For others it’s about eradicating the use of coal. For retail, delivery and logistics though, the solution lies in embracing a new era of partnerships.

Why three is no longer a crowd

While partnerships are not new to these industries, a lot of people consider alliances exclusively as between two partners; the brave new world of the delivery tech startup together with the bricks and mortar high street store. You mash them together and voila, something fantastic happens.

Trouble with this model is that it fails to account for a crucial third player that could help to combat the growing number of vehicles on our roads.

I’m yet to hear of a partnership model that capitalises on the existence of a vast and growing network of delivery carriers and vehicles, most of which are capable of, for instance, making multiple drops to one address.

The one notable exception to that is UK electric vehicle delivery company Gnewt, whose founder Sam Clarke said in a recent interview that congestion is one of the biggest failings of the last mile industry to date. “We’re doing something about air quality, emissions and electrification, but companies need to consider how goods are delivered not just what they’re delivered in,” he said.

“At Gnewt, we’re also looking into portering models based on the traditional method of one horse and cart with several porters dropping wares to buildings. If we could create a model that uses armies of walkers with each van rather than a one man, one van model, then that might make a difference.”

Were last mile partnerships to encompass three key players - a brand, a distributor and a tech solution provider - suddenly you’ve got a collaboration that’s going to get you where you need to go without doubling up on the resources required to get you there.

How to get retailers on board

When we gathered 25 tech vendors, delivery companies, food service companies and more for the latest Last Mile Consortium (LMC) to discuss partnerships, we heard about a number of ways in which retailers are, often inadvertently, blocking progress.

“The market is simply not set up or ready for the partnership culture we’ll need to fix the last mile,” said one of the participants in the LMC discussion. “We’ll start with any retailer open to working with us but it could take five years before the market really opens up.”

Granted, asking brands to partner with the same solution providers as their competitors seems to go against the grain of the capitalist marketplace in which we operate. Yet the greater risk comes from doing nothing at all.

The long tail of small companies hoping to embed themselves as valuable architects of tomorrow’s (and indeed today’s) age of ‘stay at home’ retail bring all the innovation, ideas and inspiration required to evolve the current ecommerce delivery market at the speed of the customer.

What they don’t have is scale, reach and resource. Those elements, necessary to drive real change, would ideally come from the third piece of a triangular partnership: large retailers.

Reluctance to embrace this new era in partnerships puts large retailers at risk of failing to deliver an above-average customer experience, as well as failing to nurture an environmentally and economically sustainable last mile.

Herein lies a very big problem that’s compounded by this month’s climate revelations.

The report’s findings speak for themselves - the world has just 12 years to significantly reduce greenhouse gas emissions or else face severe impacts of climate change by 2040.

Offering insight into the possible economic ramifications of global warming, The Times’ Coral Davenport highlighted the finding that, “The United States… could lose roughly 1.2 percent of gross domestic product for every 1.8 degrees of warming.”

“The report attempts to put a price tag on the effects of climate change,” Davenport adds.

Maybe it’s time we also put a price tag on the effects of the last mile - and how much it will cost us if we do nothing at all.

☛ Paul Yewman is CEO at PostTag and co-founder of the Last Mile Consortium.

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