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Going the extra mile: developments in sustainable delivery

Sustainable delivery electric van

Fashion retailers are exploring solutions to reduce carbon emissions from final-mile deliveries, including promoting click and collect, and introducing electric vans

The traffic pollution outside Drapers’ headquarters in central London is palpable, serving as a daily reminder of the emissions cars, buses, vans and lorries are pumping into the atmosphere.

The fashion industry contributes to the pollution on the UK’s roads, as retailers and brands strive to meet consumers’ expectations of fast delivery to desks or front doors. But as pressure grows on the sector to become more sustainable, fashion retailers are looking at how to reduce their carbon emissions without sacrificing convenience for the customer – from promoting click-and-collect services to introducing electric delivery vans.

Although electric vans are reliable and do away with the emissions generated by traditional petrol or diesel vehicles, high initial costs, comparatively small delivery ranges and limited availability are preventing take-up from being as wide as it could be. Nonetheless, many retailers see electric vans as a key part of their sustainability strategies and are investing in their use. 

Beyond the home

“Taking your re-usable bags into the supermarket and a re-usable coffee cup to cafes are fast establishing themselves as habits for the majority – and yet 88% of consumers globally still opt for home delivery, which necessitates tens of thousands of small vans travelling millions of miles each week to make hundreds of individual drop-offs a day,” points out Tim Robinson, chief executive of click-and-collect delivery company Doddle.

Research published by Doddle in April suggests consumers’ fulfilment preferences are largely driven by habit – although there is a growing interest in more sustainable options, 74% of the 2,200 UK adults surveyed admit they still “automatically choose” home delivery at checkout.

Mike Daly, non-executive director of Clipper Logistics, which operates two electric vans for deliveries in central London, says: “The ‘Amazon effect’ is ingrained in our culture now – people expect next-day home delivery. We can’t stop putting vans and lorries on the road, but we can make sure we do it with less of an impact on the environment.” 

The rollout of electric vans is currently largely focused on London, where all vehicles that enter the city centre between 7am and 6pm from Monday and Friday, must pay the £11.50 congestion charge. In April, an ultra-low emission zone in the was introduced, covering the same area as the congestion charge. Under the new rules, motorbikes, cars and vans that do not meet tighter exhaust emissions standards have to pay an additional £12.50 a day to enter the zone, and lorries that weigh more than 3.5 tonnes are charged £100. 

One company exploring ways around the charges is courier DPD. It opened the UK’s first all-electric parcel depot in Westminster last October, and that same month all-electric delivery firm Gnewt announced a new partnership with Asos. The latter has since delivered more than 500,000 Asos parcels within the London congestion charge zone.

Electric dpd depot paxster charging 2

Charging at DPD’s Westminster depot

Customer deliveries and returns make up 69% of the total greenhouse gas emissions from Asos’s business operations. It says finding ways to reduce these emissions “is an ongoing priority”. The partnership with Gnewt, which is owned by Menzies Distribution and has a hub in Bow, east London, is expected to reduce Asos’s carbon emissions in central London by 62% annually.

Matt Rogers, delivery solutions and returns director at Asos says the tie-up with Gnewt is a “core part” of its delivery strategy moving into 2020, adding: “We are working with most of our strategic carrier partners on understanding their plans for expanding their services on electric vehicles.” 

When you buy online from a retailer, the logistics element is largely out of your control 

Sam Clarke, Gnewt

Gnewt delivers Asos orders using an all-electric fleet of vans, and has trialled using a group of human “porters”, who meet a van in a set location and complete the last part of the journey on foot. The company is in talks with “a number” of other retailers, and exploring the rollout of its service to other cities where air pollution and traffic congestion are a problem.

“There’s growing demand for a sustainable lifestyle, but the reality is that when you buy online from a retailer, the logistics element is largely out of your control,” says Sam Clarke, head of business development at Gnewt. “The second retailers start to offer a more sustainable alternative, it becomes a USP. We tell Asos customers their parcels are being delivered by electric vehicle – it is a differentiator.”

DPD is creating a network of all-electric micro depots across London, starting with the one in Westminster. It will have more than 130 electric vehicles on the road by the end of 2019, and plans to double that in 2020, and again in 2021 to more than 550 – 10% of its total van fleet.

DPD CEO Dwain McDonald tells Drapers: “Our view is that retailers shouldn’t have to sacrifice anything to have more sustainable delivery options. We’re building smarter, all-electric networks with zero-emissions vehicles that work every bit as well as their diesel counterparts. The technology is improving all the time.”

Tech troubles

However, electric vans have some significant drawbacks. Availability is limited, the purchase cost is typically higher – although they are cheaper to run – and the average range for an electric van on a single charge is about 100 miles. Charging points are still relatively few and far between. 

Rogers says: “The obvious limitation is vehicle range. However, as we are targeting high density areas this isn’t really a limitation for the service. Carriers will need to invest more in charging points within depots as they transition parts of their fleet to electric and this could take some time.”

Gnewt’s Clarke agrees: “The batteries have got progressively better, but the reality is all manufacturers are restrained by the limitations of the current technology. A small van of ours can do no more than 100 miles a day. However, the range and infrastructure are improving, slowly but surely.”

DPD’s McDonald argues that electric vans are “every bit as good as the diesel vans in terms of reliability, build and range for the job we do”, but admits there are availability issues: “We want to go faster but there just aren’t enough UK right-hand drive vehicles in production. We are talking to all the major manufacturers to try to get more vehicles.”

Any operation using a localised electric vehicle fleet will need to invest in charging stations

Gavin Williams, XPO Logistics

Gavin Williams, managing director, supply chain – UK and Ireland at delivery company XPO Logistics, says electric vans are well suited to the fashion industry because clothing loads will fill the van’s space before weight becomes an issue. The current range of XPO’s electric vans is between 80 and 120 miles per full charge, and an 80% charge in about 90 minutes provides another 64 miles of range. 

“At this time, the biggest obstacle to widespread adoption is the commercial cost of electric vehicles – up to four times the cost of a diesel or petrol van, largely due to the battery cost,” explains Williams. “The batteries have a life span of about five years and a replacement could cost more than the vehicle is worth. Battery costs are edging downwards, but are still prohibitive to widespread commercial use. We are encouraged to see that other sources of electric power are also moving forward in development, such as hydrogen fuel cells.”

He adds that, although battery life and the UK’s charging infrastructure are improving, there is still a long way to go: “Any operation using a localised electric vehicle fleet will need to invest in charging stations, and locations with a large number of electric vehicles may need to install their own substation to provide enough power for multiple charges at the same time.”

Electric vans are not the only solution. In April, Clipper put 11 liquid natural gas large articulated lorries on the road for longer-distance journeys. It estimates that this will save 500 tonnes of carbon emissions per year.

“If they prove to be reliable, we will increase our use of gas HGVs, as part of our fleet renewal strategy,” says Daly. 

Retailers should explore a range of sustainable delivery options. For example, McDonald says DPD has found one-hour delivery slots and “in-flight” options to divert parcels to another location cut down on unnecessary emissions, while Zara and Next are among those investing in pick-from-store options, minimising the need for multiple journeys to and from remote warehouses.

Cornish womenswear retailer Seasalt has more than 5,500 collection points across the UK and is working on a project to cut down the distance its products have to travel to get to the end customer, which it hopes will reduce its carbon footprint and speed up delivery.

Brand director Sonya Corrigan says the important thing is to offer the customer a choice: “We do that with our clothing collection and we do that with other aspects of our business, including delivery options.”

The Asos spokeswoman agrees: “There may be a consumer shift in future, with consumers more willing to prioritise sustainable options over speed, but we think it will be important to give customers the ability to choose more sustainable options if they’d like to.”

As consumers continue to swing towards more sustainable lifestyle choices, fashion retailers that offer a range of delivery options will command more loyalty. And with around 4 million parcels delivered every day in the UK, and the mayor of London taking a hard line on emissions in the capital, there is every reason for retailers to explore and promote sustainable alternatives.

Sustainable delivery by numbers

  • 4 million parcels delivered in the UK every day
  • One-third of consumers (33%) are shopping online more than they were 12 months ago
  • 74% of consumers say home delivery is their default habit
  • The click-and-collect market is set to grow 48.8% over the next five years
  • 50% of consumers would like in the future to shop exclusively with retailers that offer sustainable delivery options

Sources: Doddle; GlobalData

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