It’s a common misconception that working towards sustainability goals has to come at the expense of operational efficiency or profitability. Especially when it comes to something like delivery management, the reverse is often true: if you can take control of your CO2 emissions, you can make your entire operation radically more efficient and ultimately optimize costs.
Things like boosting your route efficiency, bridging the gap between planning and execution, and decreasing wastage all dovetail nicely with both green logistics initiatives and improved profit and loss numbers. That makes it easier to prioritize these initiatives—but it doesn’t necessarily make it easier to accomplish them. After all, legacy processes and technology have historically made it hard to create and execute optimal strategic plans, and transforming that dynamic overnight seems difficult.
No one approach to either of these problems is a panacea, but one of the most impactful ways to advance your sustainability goals and improve your bottom line is to focus on improving your strategic planning.
What Impacts CO2 Emissions in Delivery Management?
Before we talk about what we mean by improving your strategic planning, let’s take a second to go over what the biggest contributors to carbon emissions in the delivery process actually are.
Here are some of the top culprits:
- Fuel consumption: Simply put, nothing else in the delivery process impacts your carbon footprint as much as fuel consumption on the road. This is a direct function of how many miles you drive, which means that inefficient routes and multiple redelivery attempts can increase your CO2 emissions significantly.
- Idling: This is really a sub-category under fuel consumption, but it’s important enough for its own bullet point—in part because it’s another issue that can be improved via delivery optimizations around smarter planning and better visibility.
- Warehouse/distribution heating, cooling, and powering: Your warehouse footprint typically translates directly into your carbon footprint. Of course, there are more and less eco-friendly ways to keep the lights on and the temperature right in the places where you store your goods. At the same time, shrinking your inventory footprint relative to the volume of goods that you’re moving can make a big difference as well.
For a lot of businesses, it might seem like electrifying one’s fleet is the obvious answer to a lot of these problems—and one day, it probably will be. But at this exact moment, it’s not always a viable model for green logistics. Why? Because electric trucks and vans simply aren’t being manufactured quickly enough to meet demand from delivery organizations. Amazon bought up the right to an entire supplier’s stock multiple years into the future, and even they haven’t been able to get EVs on the road as quickly as they’d like. The upshot is that, for the time being, most businesses are going to have to employ a multi-pronged approach to going green that involves tackling the three items we discussed above.
What Does Better Strategic Planning Really Mean?
Based on the descriptions of the main causes of carbon emissions in delivery management that we gave above, you’re probably already thinking of ways that your strategic planning impacts this. When you run trucks at half capacity because you haven’t updated your plans since the last time your biggest customer changed their recurring order volumes, you’re probably using up fuel unnecessarily. When you have to make a second delivery attempt because the ETA for your original delivery time was unrealistic, you’re driving those miles twice, and emitting twice the amount of CO2.
When we talk about better strategic planning, we’re talking about processes that speak to those concerns directly. Whether you’re painstakingly building out plans for your distribution network to other businesses, or you’re delivering to a new slate of consumers every day, you need route plans that are optimized for drive time, cost, miles driven, etc. and you need the infrastructure and tools to be able to execute on those plans.
Mixing great plans with flawless execution is hard. It requires you to be incredibly agile, with the ability to update your plans on a dime to ensure that they match up with the current realities of your business. You need to have full visibility across your entire operation both before and during the day of delivery. And you need to be fast enough to plan at the speed that your business actually operates at.
What we’re describing is a far cry from the way that most delivery organizations did things in the past. For distributors, planning routes would be a laborious, months-long process that required manually calculating the results of what-if scenarios. Even in a B2C context, truck route planners mostly had to eyeball it, meaning they couldn’t easily factor in things like driver skill, customer time window requests, etc., and determining accurate ETAs was a crapshoot.
Now, the right technology makes it possible to transform the way your planning process works. With a true, AI-powered SaaS delivery software solution, you can run what-if scenarios in seconds. The result? You can make sure that you’re delivering in the most efficient way, day in and day out. This has a huge impact on your ability to go green.
How Improved Planning Powers Sustainability
Okay, let’s take a second to talk about how the kind of fast, agile, connected planning that we’ve been discussing impacts carbon emissions, based on the areas that we identified above.
Rapid what-if scenarios
If you can plan delivery routes in a matter of seconds, you can run what-if scenarios whenever it seems like your operations aren’t as efficient as they could be. Whenever something changes in your network, the marketplace, or your customer base that might spur a change, you can immediately analyze possible responses and choose the best one. This means that you’re never going to be stuck running trucks at half capacity to a particular stop for months because it’s too time-consuming to update your plans. Instead, you can immediately pivot to something more efficient. In this way, you’re able to consistently find ways to drive fewer miles.
AI powered routing
Of course, you can only actually save miles if you’re able to execute on those plans and deliver at the right time—otherwise, there’s a good chance that you’re trucks will arrive late and your customer won’t be able to accept the deliveries. To make sure this doesn’t happen, you need to leverage AI and machine learning to create route plans with consistently accurate delivery ETAs,
We saw above how complex it can be to create route plans across an entire network that actually meet your and your customers’ needs. When you try to predict exactly when the truck is going to show up at the delivery site, you add an entire additional layer of complexity. Calculating these times by hand requires you to account for variations in service time, differences in driver speed, traffic patterns in different regions over the course of the day, and much more—all of which can be incredibly difficult and labor intensive;. But with an AI-powered algorithm that understands the way these factors impact one another, you can generate highly accurate ETAs in a matter of seconds.
The result is that you show up at the right time, every time—and thereby significantly reduce the carbon emissions that come from return logistics and redelivery attempts.
Real time visibility
Again, a lot of your ability to reduce carbon emissions in delivery management comes down to execution. When your deliveries are firing on all cylinders and you can match your plans to demand, market realities, and the needs of your own organizations, you don’t just drive fewer miles, you can also power inventory shrink, decrease wastage, and find other areas to increasing sustainability. But making that happen requires you to have a strong handle on exactly what’s happening across your operations at all times—from driver locations and statuses to customer ordering patterns to auditable records of each delivery.
Making that possible requires real-time visibility throughout the entire delivery process. When you have true visibility, you can rapidly gain clarity into any element of the delivery process—without wasting time hunting for data as it goes out of date. When you can do this, you can tackle sustainability from a more holistic perspective, decreasing waste and taking greater control over your carbon emissions.
The need reduce carbon emissions in delivery management isn’t going away any time soon. It’s something that’s increasingly going to determine winners and losers in an incredibly competitive marketplace. That’s why it’s never been more important to power up your planning capabilities.