Soham Chokshi, the CEO, and Co-Founder of Shipsy, says more than 50% of logistics inefficiencies occur in the last mile
How does technology contribute to sustainability?
Technology is a front-runner in contributing to environmental sustainability goals. AI and automation enable logistics-powered businesses to gain visibility over their operations and operate more efficiently. It automates the prioritisation of eco-friendly modes of deliveries within a specific radius, reduces the distance travelled per package, consolidates orders for planned deliveries, and lowers the overall carbon footprint of operations.
What sort of sustainability efforts does your company practice?
Our technology empowers 220+ retailers, manufacturers, on-demand delivery providers, eCommerce players, and express logistics providers globally to automate and optimise their core logistics processes to curb their carbon footprint. Dynamic routing capabilities and intelligent clubbing parameters help shrink the distance travelled by 5%, prevent engine idling, eliminate empty miles, lower trip volumes by 6%, and reduce incidents of reattempts through active customer communication.
Smart logistics tools also increase overall delivery productivity by boosting deliveries per driver by 14% and vehicle capacity utilisation by 32%. Indicators of Carbon Emission (ICE) help businesses gain visibility into the carbon emissions of their freight movement across multimodal transportation even before the shipment journey begins.
Do we need to look at sustainability beyond the use of “green energy”?
Even though using green energy is integral to the sustainability shift, it will take some time to actualise its implementation and benefits at scale. Green and clean energy fuel types must complement sustainability best practices for a profound environmental impact. In fact, immense business benefits can be achieved while adhering to sustainability goals.
Logistics is the third-largest contributor to global CO2 emissions. International trade-related freight transport alone is responsible for 7% of total global carbon emissions. More than 50% of logistics inefficiencies occur in the last mile. Hence, consideration should also be given to optimising logistics processes and choosing the right vehicle type besides fuel type.
Eliminating the use of single-use plastic for packaging needs and reducing the number of packaging materials through order consolidation is also desirable. Shrinking miles travelled, eliminating empty miles, lowering trip volumes, prioritising greener delivery modes, reducing returns, and increasing capacity utilisation and overall delivery productivity is critical to attaining sustainability.
How can companies reduce their carbon footprint?
Reducing the carbon footprint necessitates lowering fuel consumption, exploring alternative/green fuel and vehicle types to execute logistics operations, lowering the overall distance travelled, and increasing resource capacity utilisation, be it a vehicle or a rider. Additionally, shrinking the use of packaging materials and partnering with logistics providers with the least CO2 emissions.
The five key drivers of supply chain sustainability are the dynamic delivery landscape, consumer demands, economic benefits, brand conscience, and potential future regulations. Governments in the Middle East play a vital role in encouraging companies to embrace best practices to actualise their goals, such as Saudi and Egypt’s Vision 2030 or UAE Net Zero 2050 goals.
For instance, the Dubai Green Mobility initiative offered incentives on electric vehicles, both commercial and personal, to facilitate and promote their use. As an emerging global logistics hub, UAE has shown immense transformation, focusing on sustainability initiatives.
What challenges do companies face today in their journey toward net zero, and how can technology help solve those issues?
Cost, supply chain emissions, and measuring the impact are the top hindrances for small-to-medium-sized businesses in becoming net-zero emitters. Integrating smart logistics management technology to optimise logistics operations and embracing sustainability best practices into the supply chain will empower companies to attain their sustainability objectives.
Distance travelled per package is a critical metric to measure the impact of logistics and supply chain operations. AI-powered smart logistics management technologies leverage advanced territory optimisation, dynamic order batching, route optimisation, and intelligent route planning capabilities to lower miles travelled per package and completely eliminate empty miles across the first, mid, and last mile.
What factors can help companies advance toward their sustainability goals?
When it comes to logistics, the distance travelled per package should be the north star to ensure eco-friendly operations. Businesses should focus on reducing miles travelled per package and ensure that the remaining distance is covered using greener delivery modes. Prioritising electric vehicles and bicycles, choosing the suitable carrier, and increasing the first-attempt delivery rate, help tackle the latter.
Advanced territory optimisation, dynamic order batching, route optimisation, and intelligent route planning help reduce the distance travelled. For instance, advanced territory optimisation capabilities help logistics stakeholders plan resource utilisation to serve their demands and cover geographies optimally. Delivery managers must leverage dynamic automated order batching to significantly reduce the distance travelled for order picking with similar pickup locations to execute 10-minute or 30-minute deliveries.
Advanced route optimisation considers multiple constraints like delivery type, order volume, weight, costs, distance, traffic considerations, and more to chalk out the shortest and most efficient route possible and hence reduce fuel consumption. Intelligent route planning helps businesses find the most efficient route based on mapping consignments with the vehicles. Efficient logistics planning and increasing fleet capacity minimise the distance travelled, fuel consumption, and delivery time.