E-commerce and urban freight distribution in Spain post-COVID-19 - Deloitte
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E-commerce and urban freight distribution in Spain post-COVID-19 June 2020
El e-commerce y la distribución urbana de mercancías en España después del COVID-19
Contents
Growth and impacts of e-commerce 4
Need for new models 5
Cooperation as a starting point 6
This Point of View newsletter was prepared by
the following Deloitte professionals:
• Vicente Segura (Partner)
• Fernando Antolín (Director)
• Carlos Casellas (Senior Manager)
• Alberto Grandío (Manager)
• Albert Cagigós (Manager)
2E-commerce and urban freight distribution
CintillosinNIVEL
Spain1post-COVID-19
| Cintillos NIVEL 2
The lockdown increased e-sales by over
+100%, a significant proportion of which
will remain structural, which will lead to an
estimated three-year jump in demand with
respect to the growth that had been observed
in the channel in recent years.
The resulting increase in parcel transport, in
addition to greater environmental sensitivity
and the new consumption and mobility trends,
gives rise to an urgent need to encourage
improvements in the current urban freight
distribution and transport models through
public-private cooperation, raising e-commerce
customer awareness and implementing
regulations.
3E-commerce and urban freight distribution in Spain post-COVID-19
Growth and impact
of e-commerce
COVID-19 has greatly accelerated the digitalisation of people Growth in online sales1
and companies, causing e-sales in certain categories to increase From 15 to 17 May
by over +100% with respect to the same period of last year1; a
significant portion of this growth will remain structural and will
lead to an estimated three-year jump in e-commerce demand in Consumer
goods 118%
comparison with the strong +23% growth that the channel had
been experiencing.2
Homeware 147%
Also, reduced mobility during lockdown cleared any doubts (if
there were any at all) regarding the environmental impact to
which we subject urban areas in particular, where freight trans- Electronic 150%
goods
port generates approximately 15% of environmental pollution.3
By way of example, pollution levels decreased by -60% in the city
of Madrid and by -50% in the city of Barcelona during lockdown.4
Also during lockdown, parcel delivery companies managed to
take on high delivery volumes due to the unusual lack of urban
congestion, due mainly to improved efficiency in their journeys
and loading and unloading stops (and also because there was
always someone at home to receive the packages). The freight distribution and transport companies, which are key
players in all the above areas, are also suffering from constant
However, the current gradual return to normality in mobility and increases in operating costs (even jeopardising their profitability
economic activity is once again causing serious environmental in certain industries) due to the greater difficulty involved in cir-
and congestion problems, partly exacerbated by new trends culating and parking in urban areas.
such as the significant switch from public to private transport5
(55% of people surveyed stated that their use of public trans- Due to the aforementioned growing problems (involving the
port would be "greatly reduced" or that they "will stop using it"). environment, urban congestion and companies' profitability),
In China, for example, the pollution levels of 2019 have already there is an urgent need to promote improvements in freight dis-
been exceeded following the return to activity6. tribution and transportation models.
COVID-19 has brought forward by three years
the urgent need to encourage changes in freight
distribution and transportation models.
1 Source: Nielsen and GfK database
2 Source: BBVA Research. e-Commerce billings
3 Source: Deloitte Research
4 Source: Barcelona and Madrid City Councils
5 Source: Deloitte Research
6 Source: Centre for Research on Energy and Clean Air
4E-commerce and urban freight distribution in Spain post-COVID-19
Need for
new models
In this regard, in March 2020 Deloitte published the "Last Mile urban freight distribution and transport. Below we provide an
Logistics: challenges and solutions" study which, as well as ad- illustrative example detailing three solutions of particular impor-
dressing the main last mile challenges for the main industries, tance in the current situation.
details potential solutions for
Loading and unloading
management platform
In city centres, and at certain time periods, demand for loading
and unloading spaces can exceed the available fixed supply by
70%, causing a significant impact on urban congestion and a
loss of efficiency for freight distribution and transport compa-
nies (search for alternative spaces and/or double parking, lon-
ger journeys on foot to point of delivery, etc.). The loading and
unloading management platform enables parking spaces to be
reserved in advance, encourages the use of more sustainable
vehicles and discourages delivery at peak times.
Pick-up and drop-off
point network (PUDO)
In Spain less than 10% of e-commerce deliveries are made at
drop-off and pick-up points, while home delivery is the most
used option and entails higher costs in comparison with the
other alternatives, due mainly to the geographical spread of de-
liveries and because 10% to 15% of deliveries fail (and require a
second attempt).7
Delivery by foot or by non-motorised
vehicle (and urban warehouses)
In recent years, vehicle access restrictions have increased in the
centre of certain major cities. Delivery by foot or non-motorised
vehicle is the most environmentally sustainable alternative, rel-
ying on urban warehouses to support the logistics operations.
7 Source: Deloitte Research
5E-commerce and urban freight distribution in Spain post-COVID-19
Cooperation
as a starting point
The problems and solutions in urban freight transport are un-
Regulations are key, as they act as
doubtedly complex, due mainly to the number of players and
industries involved, not just e-commerce, but also retail, hospi- a catalyst for the development of
tality, pharma, etc; consequently, cooperation (particularly of a
public-private nature) is fundamental to the development of po-
solutions, but they must certainly
tential solutions. be proactive and benefit from the
Also, e-commerce customers are a key element due to the impact participation of the various players
of their decisions on the location and level of urgency of delive- and industries involved
ries. In this respect, raising customer awareness of the impacts in
terms of the various delivery options is fundamental in order to
minimise the current problems.
In any case, government regulations are a key element as they
act as a catalyst for the development of solutions, but they must
certainly be proactive and benefit from the participation of the
various players and industries involved.
6El e-commerce y la distribución
E-commerce urbana
and urban
de mercancías
freight distribution
en Españaindespués
Spain post-COVID-19
del COVID-19
Other publications
of interest
Last mile logistics - Challenges and solutions in Spain
https://www2.deloitte.com/content/dam/Deloitte/es/Documents/operaciones/Deloitte-es-operaciones-last-mile.pdf
The Consumer industry's road to recovery
https://www2.deloitte.com/es/es/pages/consumer-business/articles/camino-recuperacion-consumo-covid-19.html
Energy sustainable cities - Urban energy transition 2030
https://www2.deloitte.com/es/es/pages/strategy/articles/ciudades-energeticamente-sostenibles.html
A decarbonised transport model for Spain in 2050 - Recommendations for the transition
https://www2.deloitte.com/es/es/pages/strategy/articles/medidas-descarbonizacion-transporte.html
The future of freight - How new technology and new thinking can transform how goods are moved
https://www2.deloitte.com/us/en/insights/focus/future-of-mobility/future-of-freight-simplifying-last-mile-logistics.html
COVID-19: Orchestrating the recovery of organizations and supply chains
https://www2.deloitte.com/global/en/pages/about-deloitte/articles/covid-19/covid-19--the-recovery-of-organizations-and-supply- chains.html
COVID-19: Managing supply chain risk and disruption
https://www2.deloitte.com/global/en/pages/risk/articles/covid-19-managing-supply-chain-risk-and-disruption.html
COVID-19: Managing cash flow during a period of crisis
https://www2.deloitte.com/global/en/pages/about-deloitte/articles/managing-cash-flow-during-period-of-crisis.html
COVID-19: Maintaining customer loyalty and trust during times of uncertainty
https://www2.deloitte.com/global/en/pages/about-deloitte/articles/maintaining-customer-loyalty-during-uncertainty.html
COVID-19: People, technology, and the path to organizational resilience
https://www2.deloitte.com/global/en/pages/about-deloitte/articles/people--technology--and-the-path-to-organizational- resilience.html
7Contact persons Vicente Segura Strategy and Operations Consulting Partner, Head of Supply Chain practice and expert in the Transport and Logistics industry vsegura@deloitte.es Fernando Antolín Strategy and Operations Consulting Director, expert in Logistics and Last Mile Distribution for the Consumer industry fantonlin@deloitte.es Fernando Pasamón Monitor Deloitte Partner Global leader of the Retail Consulting industry and of the Consumer industry in Spain fpasamon@deloitte.es Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. Please see www.deloitte.com/about for a more detailed description of DTTL and its member firms. Deloitte provides audit, consulting, financial advisory, risk management, tax and related services to public and private clients spanning multiple industries. With a globally connected network of member firms in more than 150 countries and territories, Deloitte brings world-class capabilities and high-quality service to clients, delivering the insights they need to address their most complex challenges. Deloitte's more than 312,000 professionals are committed to making an impact that matters. This communication contains general information only, and none of Deloitte Touche Tohmatsu Limited, its member firms or their related entities (collectively, the "Deloitte network") is, by means of this communication, rendering professional advice or services. Before making any decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser. No entity in the Deloitte network shall be responsible for any loss whatsoever sustained by any person who relies on this communication. © 2020 For further information, please contact Deloitte Consulting, S.L.U. Designed and produced by the Marketing & Brand Department, Madrid.
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