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Sustainable Solutions for Urban Logistics · Speaking of Supply Chain

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You're listening to Speaking of Supply Chain, a meboch podcast. This is a
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show for logistics professionals looking to learn more about the latest innovations in supply chain.
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Each episode will feature a conversation on topics such as mitigating supply chain disruption
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and reducing risk, current automation trends, sustainability initiatives, and more. Let's
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dive right in. Hello, and welcome to Speaking of Supply Chain, where
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we explore trends, current events, and innovations impacting the logistics and supply chain
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industries. I am your host, Ellen Wood. I am joined today by
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Anna Kim and Gregory Perez, and we are going to be talking about urban
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logistics today. Welcome, Hello, Hello, Thanks for having me. So
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it's great to have you both here today, and I know that this is
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going to be an interesting topic. Urban logistics was the topic of our very
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first Speaking of Supply Chain episode, so I'm excited to come back to it
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and see what is new, what else is going on out there in that
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in that arena, and this particular project that we're going to be talking about.
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Our first episode of Speaking of Supply Chain was about urban logistics, and
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that was very specific. It was about a study that we had done from
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a real estate perspective, but there are so many different aspects to the topic
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of urban logistics. What are we going to talk about today, Anna,
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do you want to start us off? Yes, maybe we can. I
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mean because the study we did, but it was conducted with the LLL together,
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was having a more general general focus and also focusing on maybe the issue
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of space in the cities very much the real estate or yours. It's your
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core business somehow, And I think maybe the insights today having Gregory as as
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a work at b Post, which is on the one side like more private
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company, but also like the the the transport or the cap parcel delivery.
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So we have, yeah, another view from from from this site. What
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in urban logistics are maybe struggles and where our potentials and and and what actually
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can be achieved because I think also today the cities are very struggling with Okay,
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what should be our solution or solutions, and I think it's hard for
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them to take the wheel and and start and driving into the connection in the
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into the direction they want. So yeah, I think this can be an
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inspiring example. All right, So Gregory tell us a little bit more about
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this project. It's it's a post all, the Belgium Post. Yeah,
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so so we're the Belgian Post, so initially a mail company, but evolving
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towards let's say parcel company also, so combining both post services because yeah,
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the world is changing and we're also going forward as a company. So yeah,
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the whole the whole concept we try to develop as a company, but
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also with the city of a Machelen and together with the city of Man is
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what we name the eco zone concept. It's first started, yeah, as
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as a how you say, purely a concept, but we decided to implement
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it as as a project and deployed it on a project city, which was
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Machlen, where first we changed our feet. So traditionally we delivered by bike
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or with typical diesel vents, and there we changed that model towards pure evan
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delivery models, so all the diesel vents were switched to an event. Quite
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easy would say, but still we're talking about infrastructure works also being implemented.
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So sixty four events were implemented in the city of Mechlen, and then on
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top of that we expanded or we added a heat trailer to do to thirty
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bikes, allowing to consolidate parcels and mail to be delivered by by bike at
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the end, so guaranteeing that all parcels in Mechlen and suburbs will be delivered
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sustainably at the end of the day. Today the whole city and suburbs are
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delivered without emission and also sustainably and many aspects I will come later on on
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that. On top of that, so that was the fleet change, that's
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an easy one from us. But then we added a dense network of pickup
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and drop off points total fifty three pickup and drop off points, which includes
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manned porcelain postal points, so those are the local shops that where you can
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go pick up your parcel. But also on top of that, we developed
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or we added to that network blockers and manlockers, and that was done in
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collaboration with private players but also with the city, which is very important because
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when we were talking about a dense network, we're talking about implementing the solution
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of pickup or drop off in a maximum range of around about four hundred meters
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or less of each and every city isn't within the city, so every right
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to make sure that there's something close to everyone. Yeah, indeed, so
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so to give an image, it's the idea behind it is you you take
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your coffee, you put your coffee on at home, and you have a
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person that has been delivered when you were in home, and you go on
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foot to the locker or to the pick up drop off point near your house
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and go back, and the coffee is still more avoiding avoiding taking the car
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or or or making a trip which can generate a lot of you two on
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your way also. And then finally there's a final stage on that, and
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that's the developing local solutions. So for local logistical solutions such as a city
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microhub or local services. When we are talking about local services, it's really
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services with the goal to avoid the necessary transport of those parcels because traditionally parcels
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travel a lot of distance, but sometimes it's not necessary and it can stay
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within the city. So they're with we're trying to develop such as solutions,
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and that's where we were on board of Bullets, trying to get partnerships with
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some company local companies in order to create to create a sustainable way of working.
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So yeah, and then combining all of that in mechlens or the results
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after after two years, whereas ninety seven percent. Let's see you to emit
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it by our by our activities, but also by the I would say,
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the ways that citizens or picking up their parcels, but not only COO two
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is important. We often mentioned COO two because that's kind of the big thing,
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but that's seventy seven percent of of microparticles and of particles as also being
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diminished. So it's not only about CO two, it's it's about the order
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thing that are also voluting that that our dimination. So that's exactly all those
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particulates. Yeah, indeed, and the consequence this is not as I mentioned,
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it's not only the consequence of the feet change, so going from a
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diesel van to an event or soft mobility solution, but it's also thanks to
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the increased density of those pickup and drop off points. Only the parts of
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the pickup and drop off point diminished by o point six tons cu two emissions.
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To give an idea, it means a reduction of eighty five percent of
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the emissions related to pick up a drop off of parcels by citizens themselves.
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So it's not measuring just what the fleet is able to accomplish in terms of
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sustainability measures. It's also measuring what the citizens and the people who are utilizing
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those postal services are able to reduce their own carbon footprint indeed, indeed,
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and that they're all doing that naturally, it's not it's a choice they made,
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but they it's not all I'm doing it green now. It's the easiest
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choice and it's the greenest choice. So it's it's it's kind of a thing,
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yeah, say it's it's it's going on itself, and it's it's very
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impactful for a city because you're diminishing also other impacts because we're all sustainability.
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We are talking about emissions, but we're also talking about other sustainability goals.
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So and then generally, we had a study conducted by the University of Brussels
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and there it showed us that in general, are social and ecological costs on
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society was reduced by thirty two percent. So those are the indirect costs that
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are generated, such as impact on urban congestion, no ex pollution, accidents,
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hospitalizations, infrastructure damage because all those things. As a company, we
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don't have to pay them directly, no, but you have to pay them
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in somebody, shape or form, everyone dies and throughout all taxes. But
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it's it's, it's part of it. So it's it's very important for us
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that we approach it really from several sites. So as you figured out,
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for us, it seems those are great results and better than expected when we
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launched a project a few years ago. So what were some of the biggest
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challenges in trying to implement this? Was this your Was this your vision from
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the beginning for this particular project or did it evolve throughout the process that this
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was going to be the end result? You know, how did you go
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about trying to implement this because this seems I mean, those numbers seem significant
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and to have that as a goal post and say we're going to reduce emissions
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by ninety seven percent, that feels like a huge amount of effort. Was
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that was that intentional or was that just you know, a great result?
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We didn't know what the results would be at the start of the project.
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We had some expectancies, but right you had an idea, Yeah, yeah,
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we had an overall d Okay, if we implement events and if we
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implement soft mobility solutions, but how great the impact would be. And it
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differs also because not every city has the same shape, has the same needs,
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So so it's possible that in one city were and at ninety seven percent
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and the other way at eighty two percent. But it all depends on how
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organizationally you can work on that and towards that. But the parts of the
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parts that really surprised us was the part where the impact is great for the
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local citizens and they don't even have to worry about it. It's it came,
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It came naturally. It was just a natural lifestyle change for them and
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so simple to do. And honestly, it sounds like based on the way
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that it's set up with those drop off points and those lockers that you know,
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going out to get the mail before your coffee gets cold. You know,
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that's that's a convenience, and it's I assume that it was marketed as
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a convenience as opposed to a sustainability initiative. We're going to have your mail
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closer to you, you can get it before you get your coffee, so
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you know that sounds like also parcels also parcels okay, So I would assume
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and and this is this is just a cultural difference. So in the US
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we have mail in in many places where it is delivered directly to the home,
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and I assume that that was that was the case, or that was
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not the case prior to this, it's still the case, still the case,
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it's still the case. Yes, So it's a combination the fact we're
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doing it by van and soft mobility. So the the main choice of the
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end customer is always to be delivered at home. Of course we're selfish,
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Yeah, just a choice, it's easy, it's yeah. But at the
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end we provide throughout the creation of this network, we provide an alternative solution
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where sometimes you're not home. So in bigger cities in Belgium, uh yeah,
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we realize that given number of of parcels cannot be delivered at home because
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we are just working at that time. So it's it's it's natural we cannot
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live deliver and and at that moment we propose an alternative and they can choose
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choose to be delivered there. So throughout an application we also developed each and
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everyone can give its home address. So log into the system and say,
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okay, my first choice if a parcel is delivered by B post is to
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be delivered in the locker at the corner of the suite or at at the
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mall where I'm planning to go after my work today. So it's it's creating
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a convenience and making the choice possible, because sometimes you just don't want your
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person to be delivered at your neighbor or an insecure place I would say,
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which or your neighbor isn't home as well because he's working else. Yes,
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yes, and and but but it can also be a choice to deliver at
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your neighbor, because that is one of the choices you can make. But
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creating that network creates a number of possibilities or an increasing number of possibilities where
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it is best fitted for you to be delivered. And that's that's kind of
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the mindset we are trying to provide our customers. So what were some of
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the hurdles that had to be overcome in this project? I mean, this
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is this sounds like a huge undertaking, and you've said it's it's been two
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years in the making, and you're and you're starting to discover some of these
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results and some of these uh, these facts and figures on emissions reduction,
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and you know, customer service and how much the citizens are enjoying the flexibility
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of this new system. But what did you have to go through to get
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this in place? Well, I think, as I understood it as well
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at Gregory, Mechelen was kind of your living lab, so you you had
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liked the chance to, let's say, play there a little bit, and
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I mean we visited it last year as well and it was really surprising and
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I think, yeah, it went well. But then, as you mentioned
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before them, the part where we tried to collaborate, for example, with
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other logistics players there that there was the point where we struggled because I think
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maybe the mindset in general is not ready yet or the pressure from from more
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a governmental respective or governmental side is not there yet to force companies to do
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joint some yeah to adventure or collaboration. So yeah, the I think the
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let's say the setup in Mechelen is very a good combination of one side,
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better fleet and also these pickup points on microhubs. But I think there is
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a further step where you say, okay, now everything that is moved let's
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say throughout the city is done with one yeah, via one one company or
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or one shipper and so to combine it because I mean, just imagine that,
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Okay, b Post has now it's it's parcel locker scheme and their fleet.
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But if there would be like with the same volume or or even less
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volume but UPS and DHL and name them all, and then the city would
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would get very crowded. So I think, yeah, this is a really
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challenging point for I don't know, maybe the next even five to ten years
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to to get there. Yeah on a on a on a thinking that is
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more collaborative and yeah, really working together. But that that's that's a challenging
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point for every city and for every company, I think, at least here
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in Europe everywhere. It's interesting that you say that because in that study with
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jail All that we did last year, that was one of the perceived risks
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that coordination efforts and who would shoulder the burden of the cost and the dependence,
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the interdependence of those various service providers, the you know, the b
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Post, the DHL, the the UPS, all of FedEx whatever those are,
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uh, in that in that local economy, they weren't sure that they
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were going to be able to play nicely together in the sandbox and cooperate and
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so it's it's interesting that that is still an issue because there's so much to
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be gained. I mean, Gregory, you were talking with some really big
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numbers there, and if each of those companies could make that significant of a
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reduction in their own carbon footprint, even in that one geographical area, that
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would be significant. That's a significant savings to those companies, and you know,
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in general in terms of sustainability and our ecology to make sure that that
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were you know, being good stewards of the planet that were on. So
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one of the other things in that in that studdy that I'm going to bring
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up, and that was that technology was going to play a large role.
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And you were talking about the e vehicles, the evans and now this this
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flexibility in terms of you know, where to get a package delivered and being
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able to have that that choice. You know what, other what other aspects
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of this this project needed to involve technology because I mean, is there an
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app that that people go and and select, is it a website? How
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do they interact with this? With this functionality? Now, because you said
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it is a lifestyle a lifestyle change, but you know, there's so much
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going on in the background. All you've talked about is is all the great
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things that happen, and of course those are the highlights. We want to
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highlight those. We want to share this success and be really excited about it.
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But I can only imagine the amount of work that had to go into
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this. Yeah, it's it's it's it's a project. I would say,
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it's true time. So it takes time to make change, and we see
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technology as a big part of it. We wouldn't have thought a few years
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ago that technology would be at the stage it is today. But we are,
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we are where we are yeah, and here we are yeah and there
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there's That's what we saw most of the time. It's not really the technology
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that was the issue. The technology change and people change with it. But
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it's accepting the change in technology that that seems difficult, not only for consumers
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that receive their parcels or mail, but also for the companies needing to adapt
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because they did some investment on older technologies and up until the moment that that
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investment is it's around it. Uh, the technology has evolved, and therefore
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it's it's accepting that technological change taking place. But that's also meaning reviewing our
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way of working. So generally and coming back on the on your question about
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solutions that are put in place. As I mentioned earlier, we have the
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that might be posted app so so customers or end customers, but also the
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senders for us have the choice of implementing. So the sender has a choice
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of implementing I hold to say choice when people are making a checkout for their
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for their goods. But on the other side, we give also the end
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customer the possibility to choose this himself on top of the choice on the website
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of the sender. So so yes, potentially two places. The fact that
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that's the sender implements it on its website. It's the choice of the sender
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to do it or not to do it. And and this the application or
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the app that that the end consumer can use. That's also it's a choice
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by the end consumer. So it's it gives it, it gives it diversity
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of all solutions and making it even more convenient. So but at the end,
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it's always a choice of somebody making and we are just implementing what they
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are asking us to do. So this this test, this test run was
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in Mechelen are there any other test sites currently in progress? Are are you
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expanding this to other locations? So we're not talking about a test anymore.
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We passed. Yeah, so the test has been confirmed and applied, I
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would say, and how we're rolling it out? How to say, our
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goal is to go to fifty percent of the Belgian population that is serviced this
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way by twenty twenty five. So that's aggressive. Yeah, So that includes
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twenty five of the biggest cities in Belgium that will be delivered in this manner
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by twenty twenty five. What is the average inhabitants of these twenty five cities?
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You know, like how to make a related mark. I mean,
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we're talking to somebody in the US. So if you're talking about Brussels and
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and and Antwerp, you're talking in millions of inhabitants. But I would to
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say the Second Trank cities. We cannot say Second Trank because almost all the
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cities are that size in Belgium, but it's run about fifty to seventy thousand
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people living there. So what is what is going to be your biggest challenge
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for those larger major metropolitan areas. Is that more challenging or are the smaller
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cities more challenging. Well, the I would say Brussels for example, it's
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we're talking about Brussels, but for US, Brussels are nineteen postal areas,
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so it's a postal area. Is similar to a city normally, right,
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It's it's an individual piece. Yeah, so so it's it can be divided
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into nineteen pieces. So what we try to do it at once but as
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good as possible. But there we're trying to do that and then evolving into
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into the full Brissels cities and Antwerp it's the same concept also, so we're
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not talking about only the city center but really the whole the whole of the
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city yet claims itself to be Antwerp or Bressels, yet the entire metro area.
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So we have we have an expression in English that is, you know,
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how do you eat an elephant and one bite at a time? Like
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you have to do it in smaller pieces because you can't you can't tackle the
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whole beast in its entirety. So that's that's interesting. So is the is
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the concept different in terms of going and taking this and rolling it out in
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a large city? Do you do things differently or do you just do it
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in those smaller pieces? I mean, does anything on the whole change when
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you're looking at that major metropolitan area with nineteen different postal areas, or does
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it change and and maybe expand a little bit in those smaller ones. I
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mean there has to be some difference, right, Every city is different.
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Every city has its own way of doing things. So we need to adapt
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to those ways that each city is working. Some of them accept us with
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open arms. So those are the easier parts. They are ready for the
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change. They want it, so of course it's easier. Yeah, they
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want it because because they have themselves issues. If I take two examples in
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Namur, which is the French talking part of Belgium, help say, the
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biggest city there three going back, So in Belgium you have two parts,
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and Namure is the city of Wallowing, and there we developed the project.
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At first, there was no sense of urgency of doing this so but it
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was really, oh yeah, it's great, it's a great idea. Okay,
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we will implemented, but there was no urgency there. And then suddenly
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the city decided, okay, the city center won't be accessible anymore to everybody
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all the time, and then things started changing because there was a limitation created
28:37
by the city and uh, but the fact we already were rolling out the
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equisone where we had already soft mobility for example, in place we were weren't
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really impacted that by that change. Okay, so you were ahead of that
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curve. Yes, indeed, and that's that's kind of the goal of of
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developing it into the twenty five bigg cities. Because we're going towards this.
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Europe is telling us or telling Belgium, you need to reduce your CU two
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emissions, you need to review the way cities work and everything. So at
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the end we're going there, so let's do it at once or try to
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do it at once. And then you have Brussels, which which is another
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example. In Brussels, you have a lot of congestion and it's it's a
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capital of Belgium, so so very a lot of congestion, card congestion and
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implementing those soft mobility solutions gave a solution that we are not blocking traffic during
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peak hours, but also the dense Spilo network make sure that we are not
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spending still in the middle of the street while ring and then somebody's door Bill
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and he's not home, So it's it's kind of a win win situation for
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us because we lose less time, but not at the other At the other
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hand, the helps, say the citizen or or or for people working in
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the city aren't impacted by our activities or less impacted by our activities, so
30:23
we say sure. So what on a from your perspective, I mean,
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obviously the b Post is hugely successful in rolling this out, and it's it's
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rolling out to more and more cities ongoing. Why are other companies not jumping
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on this bandwagon? Why are they not trying to do the same things or
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are they Well, I think they are maybe not to that extent, or
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they're not so present in one city to to to have it like yeah,
30:59
they're playground and their solution implemented there. But I also think, as Gregor
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mentioned, I mean, there is the goal of the year U to reduce
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your two missions in in the big cities until twenty thirty, but the cities
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haven't taken let's say, that much action until now. For example, I'm
31:23
living I live in Barcelona and we have for two years or yeah, two
31:30
three years now we have like an a mission zone in place, but if
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you're a resident in the area. For example, I have an old diesel
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it's not so old, it's ten years old, but okay, yet already
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considered old a diesel car. And if I wouldn't be a resident in Barcelona
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City, I couldn't go into the city. But as I live here,
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I'm still like I can still have it. Yeah, I'm still allowed to
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go in. And also that's not that there are they are like any fines
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or any It's not like they are starting to control it. Maybe a little
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bit, but they don't do Also like an action. Okay, if somebody
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is not playing by the rules, then he has to pay for it.
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So I think with more and more restrictions coming from the cities, the companies
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and they not only shippers, but also think of all the industry like food
32:37
beverage delivering to the supermarkets, they really have to then, yeah, to
32:44
consider changes. So I think it's still you know, it's I see it
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a little bit the way I worked during university until I haven't had enough pressure
32:54
that now the exam is like its two days, I wouldn't start studying.
33:00
So yeah, I have the feeling that, you know, human humanity works
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like this a little bit. If you don't have like somebody saying to you,
33:08
like look now you have to act, you say, okay, a
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little bit longer. Maybe it's working. And yeah, I mean that there
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are a lot of companies have already things in place, for example that their
33:21
disrebution vehicles are electric, and so yeah, there's there's a lot of change,
33:30
and yeah, I think we will see more of this as well in
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the next years. But clearly for me, there is missing a little bit,
33:38
let's say, more restriction parts from the government and also like directions or
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what is it. Is it more going to and having collaboration and having an
33:50
urban consolidation center outside of the city, or is it having parcel lockers or
33:53
is it having a shared fleet. So it's a little bit okay, what
33:58
direction should take of for each industry, let's say exactly, so many moving
34:02
parts, so many different players. I mean, post post and parcel is
34:07
only one industry. You know, as you were mentioning, when it comes
34:10
to just the restaurant and the food and beverage industry, trying to get those
34:16
deliveries of you know, fresh food into those city centers to those restaurants,
34:22
how does that look for that local you know, grocery wholesaler. That's a
34:27
completely different industry and it's a completely different model. They can't use a locker
34:30
to just drop off a you know, a crate of vegetables or fruit or
34:35
or you know food to a restaurant. That's not feasible. It has to
34:37
be different. But that that issue of having that that traffic, those vehicles,
34:44
those emissions in the city center still exist. So it'll be interesting to
34:50
see how some of these cities solve the the issue of those those urban logistics
34:55
in those city centers for the various different industries. Because it's not a one,
35:00
one size fits all solution, we would like to add the fact is
35:05
also it's a mindset. It's a mindset. As a company, we as
35:10
b Post made a choice not only to be the best in class, but
35:15
to become a reference and sustainability. So when when you say such things,
35:22
you need to act on it. And and sustainability as a way of working
35:27
in all its aspects, we want to be. We are also a sustainable
35:32
employee, for example, so we try to avoid working with subsidiaries, trying
35:38
to every employee is the people's employee. We still have services that are done
35:45
by by by service providers, but those are very limited in Belgium. So
35:52
it's it's also implementing generally into your buildings solar panels, making those changes end
36:00
to end, not only not only saying you're trying to do it, but
36:06
really acting on it and believing it can happen. Three years ago with equal
36:13
Zone, a lot of people were saying to us, oh, yeah,
36:17
it won't work, the world won't change. But we're standing now three years
36:23
later and we're just rolling it out nationally and it has been financially checked,
36:30
so as a company also sustainable financially or we need to be sustainable financially so
36:38
and therefore it was accepted, it was checked if if it was in line
36:45
with everything, and now the rollout is happening. So it's a mindset and
36:52
a choice as a company. Well, and I think you had mentioned that
36:57
you know, you had tried this and they thought you were going to fail,
37:00
and you've proved them wrong. You've proved them wrong and it's a fantastic
37:04
success. And thank you so much for coming on our show today to tell
37:08
us more about it. Where can our listeners learn more about the b Post
37:15
project and and what what the possibilities are in terms of what they could try
37:21
to accomplish on their own or within their own companies or within their own cities.
37:27
Well, we have the b postgroup dot com slash sustainability what page and
37:34
there you can't see your initiative initiatives, and one of it is the echo
37:38
zoning initiatives where you can't see you work all the impacts we're working on what
37:46
has been done already, all right, the ecozone initiative and it's on the
37:51
b post website. And Anna, what about you if if a company out
37:54
there is interested to learn about how they could try to implement some of these
37:59
things, can they reach you on LinkedIn if if they want to get a
38:04
little bit more insight on what it actually takes to make a project of this
38:08
caliber successful. Yes, definitely, I mean I'm on LinkedIn and the back
38:15
as well. And yeah, I think we're currently working on helping our customers
38:24
and if they have any issues or problems within the cities delivery or if even
38:34
the city itselves. You know, it's it's not only the perspective of the
38:38
companies that are, yeah, using the city of as as their delivery point
38:44
or whatever, but also the city themselves. They can reach out to us
38:49
and we can see how we can help them fantastic Well, that brings us
38:53
to the end of our episode. Thank you so much, Anna and Gregory
38:57
for joining me today to talk about this this project. I am so I
39:01
knew this project was taking place. I knew that this was going on,
39:05
but I had no idea that the results were so staggering and impactful and such
39:12
a positive result from it. I'm sure that that is so gratifying for all
39:15
of the hard work that you've put in for the past two years to be
39:19
able to come out and say this is what we were able to accomplish,
39:23
because it's just amazing. I hope that our listeners enjoyed the discussion as much
39:29
as I did. If our listeners, if you're listening out there, if
39:31
you have a suggestion for a topic, or you would like to be a
39:35
guest on our show, we'd love to hear from you, Please reach out
39:37
to me at podcast at meback dot com. As always, thank you for
39:42
listening to Speaking of Supply Chain. If you've enjoyed the show, please rate
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