In recent years, online shopping has been rapidly increasing. Optimizing the sorting processes in e-fulfillment centers, combined with direct parcel delivery from these centers to nearby customers, has not been widely studied quantitatively.
The primary objective of a recent paper is to determine whether e-fulfillment centers can reduce parcel delivery costs: ‘To what extent is it possible to perform direct parcel delivery from the E-fulfilment center to nearby customers?’. Two models calculate the cost savings achieved by using an e-fulfillment center. The volume of parcels plays a crucial role in the calculation and competitiveness of delivery costs.
The time-driven performance reaches a break-even point at parcel volumes that can compete with logistics providers. Additionally, directly delivering parcels from an e-fulfillment center to nearby customers reduces greenhouse gas emissions.
The results of this study indicate that omitting the sorting processes and delivering parcels directly from e-fulfillment centers to end customers is both sustainable and financially feasible.
Eliminating the sorting processes in conventional delivery methods highlights the significant impact of volume relative to distance and time on delivery costs. In the first base scenario, home delivery costs within a 25-kilometer radius are €4.07 per parcel. To enhance competitiveness, volumes must increase, which can be achieved through additional demand or consolidating demand for more than one day into a single route.
Incorporating (un)manned pick-up points in the second alternative could reduce costs to €1.50 – €2.00 per parcel. Therefore, increasing volumes compared to the current one-day delivery model is crucial for lowering delivery costs and competing with major logistics providers such as PostNL or DHL Parcel.
Direct parcel delivery is also expected to lower greenhouse gas emissions between sorting and distribution centers and last-mile delivery. By consolidating parcels, fewer delivery vehicles are needed, potentially reducing city congestion.
Further research is needed to develop strong business propositions and potential future implementation of direct parcel delivery. Ideally, this research should explore the possibilities within the geographical parcel network infrastructure rather than relying on assumed (un)manned pick-up points. Population density and the number of (un)manned pick-up points in different geographical contexts could yield varied results due to environmental factors. Additionally, reducing peak tensions on automated sorting processes of large Logistics Service Providers (LSPs) could positively impact sustainability and city congestion.
Future studies should examine these possibilities and their sustainability impacts. Finally, the next step in online shopping involves integrating return delivery processes with direct delivery, bypassing sorting processes. Designing and exploring this model using an activity-based cost approach would be insightful. Incorporating this function into new hubs and urban consolidation centers could also be beneficial.