Can retailers overcome the challenges of urban deliveries?
Photo: UPS

Can retailers overcome the challenges of urban deliveries?

Pity the poor city apartment doorman. In the past, the job entailed screening guests, shoveling snow outside after the occasional storm and helping out with the rare delivery. With the rapid expansion of online selling, however, the front lobby now resembles a warehouse.

“With hundreds of residents now buying 10 or 20 percent of their goods online, a concierge who used to handle a flower delivery or two now may be running the equivalent of a package sort center in the building lobby,” states a press release from the University of Washington.

The release announced the university’s formation of a new lab that will bring together a multitude of stakeholders — urban planners, city officials, researchers, truck freight carriers, logistics experts, commercial developers, and companies like UPS, Nordstrom, and Costco — to study urban goods delivery and test new ideas. The lab will initially focus on the “Final 50 feet,” or the last leg between delivery drivers finding a place to park and handing off a package in a private building.

In the case of apartment and condo buildings, owners are being asked to design loading and common areas to handle the daily stream of packages. But the broader challenges involve limited curb and parking space where delivery trucks, bicycles, pedestrians and cars all need to coexist.

The project will map existing the freight infrastructures like private loading bays as well as delivery patterns. Solutions will be tested, such as managing curb space or alleys differently and exploring centralized drop-off lockers. Off-hour deliveries, for instance, may alleviate traffic and parking headaches but also drive noise complaints.

Eventually, the project hopes to develop an “Urban Freight Score” — similar to a Walk Score that rates walkability for pedestrians —to evaluate the ability of trucks to access different locations around Seattle.

“The ‘final 50 feet’ highlights the challenge of coordinating across numerous, diverse stakeholders,” said Anne Goodchild, the university’s civil and environmental engineering associate professor. “It’s a problem that isn’t going to solve itself and no one can solve independently.” 

BrainTrust

"As long as consumers demand delivery, retailers must accommodate or risk losing business."

Lee Kent

Principal, Your Retail Authority, LLC


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Adrian Weidmann

Managing Director, StoreStream Metrics, LLC


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Adrian Weidmann

Managing Director, StoreStream Metrics, LLC


Discussion Questions

Discussion questions: How will the challenges of urban delivery affect the growth of e-commerce in cities? Do retailers have much opportunity or leverage to support improvements in urban delivery?

Poll

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Tony Orlando
Member
7 years ago

I said quite a while back that this will become a nightmare for urban areas as more and more consumers want their goods delivered. And who could blame them? I don’t see a simple solution for this, as most of these delivery areas already are jammed with apartments with very limited parking and old narrow streets where tempers flare just to find a parking spot. Add in all these trucks to the equation and it is going to get ugly, as they will block the streets all day long.

This is the new normal for America, as the promise of free delivery and no-hassle returns from the likes of Amazon have already caused chaos on the side streets. With exponential growth long into the future, something magical needs to happen to keep our streets flowing and, above all, safe for the local citizens, as UPS drivers think that they own the streets. This will get confrontational as it gets worse.

Solutions? Let’s see. Can we convince a landlord to maybe empty out a first floor apartment in their buildings to allow a safe storage area for all these packages? Only if someone, be it Amazon or UPS, pays a stiff rent and they also pay to renovate the inside, to make the pickup area safe, and make sure that the customers get their packages and not another customer’s. Who will run this little storage area to make sure that theft is not an issue? Or will they have to provide a paid employee at each apartment who receives these daily packages and actually runs them up to the individual apartment, kind of like a concierge? Something must give, as landlords will not give up their precious spaces for free, I can assure you.

The biggest problem to me is the traffic jams which already are a problem. Again, as I mentioned, the delivery vehicles think they own all the roadways and rules need to be established and I’m sure someone on either side will be upset with the final ruling in each city or town.

Technology is awesome, but finding solutions to this without the consumer having to walk a quarter-mile to a pickup zone, which defeats the purpose of free home delivery to your door, is going to take some logistical smarts to get it right. Let’s see if they can all get along and figure this out, but someone has to pay for this.

Lee Kent
Lee Kent
Member
7 years ago

As long as consumers demand delivery, retailers must accommodate or risk losing business. What can they do? It’s a whole new ball game out there and retailers should be participating with these urban delivery projects to see where they need to be and what they can do to help. The use of lockers and BOPIS are already good alternatives but there is more work to be done and miles to go before we sleep.

Doug Garnett
Active Member
Reply to  Lee Kent
7 years ago

I guess what’s missing for me is, a.) how many are doing the demanding and b.) are they willing to pay enough for there to be profit doing those deliveries?

From what I can see, this is a highly vocal minority doing the demanding. And the only places in the U.S. where there is a high enough concentration of them for profit to be possible are the largest cities — and in the high density cores of those cities.

Shifting to the services … I don’t believe most started based on consumer demand. These seem to be a result of a desperate search for high-profile announcements (especially tech) to be covered by the press. And with that goal in mind, maybe not a bad strategy. Because high-density city cores mean their services work for the press and that increases page space.

But I think the PR far outpaces the incredibly weak consumer demand for these services where the mass of Americans live.

Lyle Bunn (Ph.D. Hon)
Lyle Bunn (Ph.D. Hon)
7 years ago

Do we doubt that shippers and other parts of the delivery supply chain (including the municipalities that issue parking tickets) do not benefit as much as consumers who enjoy its convenience? Let productivity prevail as inefficiencies are driven out of the system through “pay for benefit,” drop and key-lock boxes, alternate “last 100 feet,” air and street drones and other approaches.

Camille P. Schuster, PhD.
Member
7 years ago

Space for deliveries is one challenge — having a secure place is another. In buildings with no concierge packages are left by mailboxes or in the hallway by the apartment door. Creating a secure place for deliveries is as much of a challenge as finding a way to make deliveries more efficient for trucks. With the current volume of online purchases this challenge exists now. With increased online purchases the problem will become more severe.

Zel Bianco
Zel Bianco
Active Member
7 years ago

I’m already seeing newer buildings in NYC being designed with holding areas behind the concierge desk. Even with these new spaces, the number of boxes spill out into common areas anyway. As mentioned, an even bigger issue is where to park the UPS truck when these deliveries are being made. With more and more Uber and Lyft cars virtually everywhere, Citi Bikes, yellow taxis and tourists, I don’t know how it will get better anytime soon. Now that Uber is delivering food, perhaps they need to drop off your Amazon deliveries with your take-out.

Ryan Mathews
Trusted Member
7 years ago

It’s a real problem today and it will be a REAL problem tomorrow. Imagine a world where urban residents get 20 percent (today’s high end) to 40 percent of their goods online. It’s not really that much of a reach, given the current e-commerce growth rate, but it would mean doubling the current problem. Now think about the fact that urban living is expanding and that more and more Millennials and Gen Zers want to live in central city apartments rather than planned suburban communities. So in just a few years we will have denser urban populations ordering more and more goods.

There are some obvious Band-Aids such as scheduling certain delivery services at certain times and converting common areas to package pickup locations — but these hardly begin to address the real issues. Maybe what we will see is the emergence of neighborhood depots — centralized facilities where customers will go to pick up their packages. Whatever the answer, it isn’t going to be easy.

Max Goldberg
7 years ago

Consumers want delivery and, if retailers want to make a sale, they will accommodate this consumer preference. The operation of delivery will change and adapt to new knowledge and technologies, but I don’t see doormen going outside to catch packages dropped from drones.

Cathy Hotka
Trusted Member
7 years ago

This piece describes issues around deliveries in dense urban areas, but in less dense areas like the leafy streets in my area of Washington, DC, package theft is an issue.

There’s an opportunity here for third-party receivers to handle this traffic. Buildings that have some extra space (think: post offices) can receive packages and hold them for a small fee. I’m surprised we haven’t seen this happen yet, but as deliveries surge, we might.

Ben Ball
Member
7 years ago

I have just one word for you — “lockers.”

Within a year it will be a popular selling feature for multi-unit buildings and within five it will be standard.

Steve Montgomery
Steve Montgomery
Member
7 years ago

Most of the comments indicate the burden is on the retailers, but the actual delivery process in most cases involves a third-party delivery service such as UPS or FedEx. They are the ones who bear the burden of the last 50 feet. That being said, I know that the retailer will be the first place called should the delivery not show up.

C-stores and others are working to create safe and secure delivery points, but as the discussion has indicated that will likely be only part of the solution.

Brian Numainville
Active Member
7 years ago

Disruption of traditional models can be painful. These types of deliveries will have difficulties associated with them in dense and not so easy-to-traverse areas of inner cities. Whether it is creating an obstacle to traffic, package theft, creating a secure holding place within buildings and so on, these issues will need to be addressed. And while it may be a small(ish) number of people today, this isn’t going away as the younger generations migrate to more e-commerce, not less.

Ralph Jacobson
Member
7 years ago

We see this challenge being addressed in much the same way as Uber/Airbnb, etc. Individuals are more than anxious to earn a few bucks by delivering goods in urban areas and this is happening with innovative retailers, large and small, as we speak.

Shep Hyken
Active Member
7 years ago

The last mile… The last 50 feet… Great topics. There are currently excellent solutions available. The one that wins is the one that is most convenient for the customer. Just last night I watched an interview as Jeff Bezos discussed this exact concern. With Amazon on the case, I’m sure we’ll see some very customer-focused solutions.

Craig Sundstrom
Craig Sundstrom
Noble Member
7 years ago

Is this really a new issue? Up until about the 1950s — i.e. the period when housewives in cities were still dependent on public transit — a great deal of the sales from department stores and presumably, many other kinds of stores as well were delivered, and of course the most bulky kinds of goods (furniture, appliances, etc.) have always been so handled. How many things does the average person really buy on a frequent basis anyway? Admittedly, if most groceries go online, that could become an issue, but as I’ve frequently opined, I don’t see that happening.