Last-mile operations slow to adopt EVs, lack sustainability measurement tools

Despite the obvious fit for last-mile operations, few organizations are adopting electric vehicles although interest remains high.

Short routes that allow for vehicles to be home nightly have been identified as an ideal fit for EVs, but a new report from DispatchTrack found that while 85% of supply chain organizations would consider adding EVs to save on fuel costs, only 14% are currently deploying them or plan to do so in the near term.

The Last Mile Sustainability Perspective, released Thursday, delved into other areas of sustainability, asking 142 logistics professionals across several industries a series of questions. Respondents to the online SurveyMonkey survey came from the furniture and appliances, third-party logistics, building supplies, medical, agriculture, auto parts, and food, beverage and grocery distribution sectors.

“There’s no question the economy is having a major impact on all aspects of business and the supply chain certainly is no exception. Everyone is facing pressure to do more with less. At the same time, the C-suite recognizes that the last mile delivery experience is crucial to customer retention so they have to find a way to reduce costs without breaking their promise to customers,” said Satish Natarajan, DispatchTrack co-founder and CEO. “Fortunately, a superior delivery experience and cost efficiency aren’t an either/or. Route optimization not only ensures deliveries are made on time but is also critical to cost savings by reducing miles driven and trucks on the road, which also happens to cut carbon emissions.”

DispatchTrack is a last-mile delivery technology company.

On the question of EVs, more than one-quarter (27%) said they were cost-restrictive while 26% cited infrastructure concerns. Almost half (47%) said they don’t know enough about EVs.

Of those that are interested in EVs, 60% said they would consider adding the vehicles to reduce the fleet’s carbon emissions.

Despite the mixed results on EV adoption, the survey did identify that most supply chain practitioners are interested in sustainability efforts across their organizations.

More than three-quarters of respondents (77%) said they are prioritizing sustainability or plan to in the next year. Among the ongoing efforts, the top strategies for improving sustainability include maximizing truckload capacity (61%); improving routing efficiencies to limit emissions (54%); technology investments (17%); and offering delivery options to customers that limit emissions (16%).

Those efforts, though, are not being shared with the broader ecosystem. Just 1 in 5 respondents said they are sharing their initiatives with both employees and customers and 1 in 3 are sharing internally but not externally.

That could be a missed opportunity. A recent survey of over 8,000 global consumers from Descartes found that 54% of people would accept longer lead times when dealing with a company that placed a higher importance on sustainable delivery. In addition, 20% said they would pay more for a delivery from an environmentally friendly company.

Those responding to the DispatchTrack survey seemed to acknowledge this, with 55% stating that sustainability is somewhat (35%) or extremely (20%) important to their customers, but 15% said that it is not important to their customers.

Importantly, despite the interest in sustainability, 61% of companies said they don’t track their efforts nor have the ability to measure them.

The report also explored business outlook and found rising operating costs were far more concerning than demand reduction. Three-quarters ranked rising costs as their top concern while 37% pointed to reduced demand. Eleven percent said staffing is being reduced as a result.

The respondents identified a number of areas where last-mile operations can be better optimized for cost savings including delivery execution (42%), customer communication (41%) and routing (40%). The report also found the vast majority of supply chain organizations (73%) still struggle with driver shortages, though not as significantly as the previous year.

Click for more articles by Brian Straight.

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Editor: Brian Straight