Soham Chokshi is the CEO and Co-Founder of Shipsy, India’s first and only end-to-end Global Trade and Logistics Management Platform that helps customers reduce logistics costs, achieve transparency and improve on-time delivery of goods across Ocean, Air, Rail and Road with an intelligent approach. Under his supervision, the company has rapidly blossomed into a leading SAAS-based solution provider dedicated to reducing logistics costs and improving on-time delivery of goods across the ocean, air and road transportation through its pioneering ‘Bloomberg for supply chain’ model. In his professional capacity, Soham spearheads the overall business growth of the organization.
Logistics activities significantly contribute to global carbon emissions. But, there’s a whopping difference in the carbon emissions generated across different logistical modes. For example, for one metric ton of freight, sea freight (10-40g) generates the least CO2 emissions, followed by rail (30-100g) and road (60-150g) per kilometer. The bigger beast here is the air freight which emits the highest, 500 gms of CO2 for the exact freight weight and distance.
Unfortunately, the rapidly growing levels of CO2 emissions are triggering unprecedented levels of weather changes, flash floods, forest fires, and even causing glaciers to melt. In fact, our planet is now losing 1.2 trillion tons of ice each year, which drove a 21% rise in sea level over the past two decades.
Asia accounts for almost half of the global greenhouse gas emissions. It is also one of the most vulnerable regions that see the wrath of climate change. If the problem goes unaddressed, SouthEast Asia’s economy could shrink by 11% by the end of the century.
The approach to sustainability should be more proactive than reactive. Hence, making supply chain and logistics operations more sustainable and knowing the carbon footprint of our logistical activities is the only logical step ahead. This will help preserve the environment and empower businesses to reap excellent results with optimized costs, greater productivity, and lesser energy consumption.
But what’s the secret to brewing this magical concoction of environmental sustainability and business sustenance?
Enabling Sustainable Logistics
Wisdom lies in taking correcting supply chain and logistics operations on the go. Using alternative sources of energy for various legs of the logistics process is an excellent way to begin. For instance, rather than a fleet of vehicles that run on fossil fuels like petrol and diesel, deploying a fleet of electric vehicles can majorly cut down carbon emissions. Order bundling is another good way to reduce emissions. Consolidating multiple orders from the same customer in one carton and getting them all delivered on a single trip lowers the carbon footprint and the consumption of packaging materials.
Additionally, intelligent logistics management solutions help optimize logistics processes. Here’s how:
Optimizing Routes to Reduce the Distance Traveled
The delivery route plays an instrumental role in executing efficient logistics operations. AI and ML-driven dynamic route optimizers plan the most efficient route across multiple touchpoints, reducing time spent on the road. It is constructive in addressing last-mile inefficiencies, a headache for 61% of transport and logistics companies globally. Besides, 40% of trucks in Asia run empty, followed by the US (36%) and Europe (27%). This highlights the gaps in logistics planning operations, and a solution to counter/minimize empty miles traveled is badly needed.
Dynamic route optimizers help eliminate empty miles by smartly combining pickups and deliveries. They reduce the distance traveled by 5%, prevent vehicle idling, and lower trip volumes by 6%.
ETAs, real-time tracking of delivery progress, and flexible deliveries also empower customers to request a change in delivery timeslots at their convenience. The capability plays a crucial role in increasing first attempt success rates, reducing trip volumes, and hence, the CO2 emissions due to multiple reattempts. Delivery managers can also configure and prioritize eco-friendly modes of transportation such as bicycles, EVs, or autonomous vehicles for short-distance deliveries using a pre-fed logic.
Enhancing Address Quality to Lower Returns
For express parcel delivery providers, a poor quality address or the drivers’ inability to navigate to the customers’ location on time is a big asterisk to driving sustainable logistics operations. It leads to greater fuel consumption and unnecessary CO2 emissions.
Geocoding converts poor-quality or human-readable addresses on the parcel into precise coordinates (latitude-longitude). The address appears as a polyline on the driver’s app that leads them to the specific street/delivery location. This feature lowers fuel consumption by reducing delivery reattempts and carbon emissions and facilitates accurate and timely deliveries, leading to lesser returns.
Improving Capacity Utilization to Boost Vehicle Productivity
Enhancing delivery performance by automating capacity planning is imperative. AI-powered logistics management tools seamlessly club vehicle and consignment data. They can optimize a vehicle’s capacity by considering delivery location, order weight, volume, time SLAs, storage capacity, etc. This will allow them to enhance fleet capacity without hindering mileage, vehicle life, or efficiency. Vehicles running on optimum capacity mean better productivity and fewer emissions. Such innovative tools increase vehicle capacity utilization by 31%.
Clubbing Orders to Reduce Trip Volumes
Logistics management platforms consider drivers’ current workload, order volume, delivery routes, and proximity to the delivery location to assign multi-stop pickup and delivery tasks on the go intelligently. En route order clubbing combines pickups and deliveries to reduce trip frequencies and ensure 14% more deliveries per driver.
Monitor Carbon Footprint to Ensure Compliance
The advent of technology and rapid digitization has blurred geographical boundaries. Cross-border logistics has become increasingly popular recently, with more and more brands engaging in it. Gaining visibility of a shipment’s carbon emissions even before it commences its shipping journey is crucial for reducing CO2 emissions. Innovative logistics tools help cross-border logistics stakeholders gain insights into tank-to-wheel and well-to-wheel CO2 emissions. Sustainability dashboards allow logistics stakeholders to track emissions across a shipment’s lifecycle and identify areas needing immediate attention. Dynamic routers reduce miles traveled, shrink returns, eliminate empty miles and vehicle idling, and enable greater rider productivity. Moreover, technology-led logistics strategies can reduce shipment returns by 18%.
More and more companies are looking to minimize their carbon footprint and build more resilient and sustainable supply chains. Incorporating the technology capabilities and a mindset for eco-friendly operations can put supply chains on the right track.