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City distribution: an increasing challenge for logistics providers

City distribution: an increasing challenge for logistics providers

Increasing e-commerce and urban population growth are creating big challenges for city distribution. The solution is to be found in more efficient and sustainable delivery methods.

City distribution refers at the first glance to parcel delivery in urban areas. As urban areas are growing rapidly and thus becoming more complex, carriers have to rethink their traditional delivery methods. They need to improve the speed and effectiveness of delivery, and at the same time, the environment should not suffer and public life should not be disturbed. Due to e-commerce and the growing economy, consignments into cities are growing at record speed and the infrastructure has not been able to develop at the same pace. All this is challenging for both B2C and especially B2B deliveries, according to Stefan Hohm, who is Corporate Director Corporate Solutions, Research & Development at Dachser:

“The main challenge in the B2C sector is to meet the consumer at home at the right time and get a parking space in front of his house. A consumer wants the possibility to track his consignment all the way from the online shop and influence the delivery time of his order. In our core business, the B2B sector, the main challenge is to fulfil the requirements and restrictions specified by the receiver of the parcels or pallets. A company likes to be able to track the consignment only in the case of discrepancies. This, together with heavy traffic and environmental concerns, forces logistics providers to plan efficiently with flexible IT tools when planning routes as well as when forecasting traffic. A solution could be to treat B2C the same way as B2B, and apply the lessons learned in one segment to the other.”

With the City Distribution project Dachser aims to innovate deliveries in cities. The project consists of a closely collaborating team of more than 10 employees, located in several European countries. They are currently working on the development of a sustainable business model for City Distribution and on a tool box for European metropolitan areas. As all cities have their own individual and special requirements, the tool box will be a practical method for providing a variety of solutions to the local operational department. They will be able to choose between the relevant concepts and apply them regionally in their metropolitan areas, flexibly and according to their needs.

Everyone plays a part in the future of city distribution
Sustainable delivery involving micro hubs, night deliveries, implementation of new energies and technologies are just some of the components of what Stefan Hohm believes to be the solution for the city distribution challenge.
“We are working on different concepts e.g. micro hubs, we are employing several types of electric vehicles, and we have developed different products for different consignment flows. Our B2B products focus on speed as well as precise and flexible delivery times. And our B2C products concentrate on tracking, personal contact, installation and disposal of packaging materials. We continue to develop new solutions through our City Distribution project”, says Stefan Hohm. However, carriers cannot carry the burden of improving city distribution all by themselves. Authorities, enterprises and society need to step up and take part in making city distribution more sustainable.

“To truly optimise city distribution we also need to collaborate with authorities and share our observations and needs. It will also be necessary for enterprises, authorities and people to change their mindsets and set more priority on sustainable solutions. Not everything has to be delivered in one hour! I am sure that city distribution will be much more efficient in the future through IT solutions and electric vehicles, but due to the massive increase in shipments, the amount of traffic will not disappear overnight. City distribution will become a challenge for society as a whole and therefore politicians and public authorities have to participate more in this discussion,” Stefan Hohm concludes.


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