Top Sustainable Delivery Trends For 2024

Climate change’s threat to business is growing, according to The Economist. If global temperature rise passes the 1.5% mark in 2024, they predict labour productivity in the logistics and delivery industry will suffer, noting that heatwaves have already contributed to strike action at UPS and Amazon.  

That means sustainable logistics operations are more important than ever. Yet it’s easy to lose sight of the environmental impact of your supply chain operations, especially with the rise of e-commerce, automated order fulfillment systems, and increased competition among last-mile delivery companies. 

In this article, we’ll take a closer look at what sustainable logistics entails, why it matters, and the top sustainable delivery trends to watch in 2024 and beyond.

What is sustainable logistics?

Sustainable logistics initiatives aim to minimize the environmental impact of the practices and processes involved in logistics, freight and transportation. 

Why does it matter? For starters, we need to move the whole world towards low-carbon or carbon-neutral practices, and the logistics industry is no exception. 

The logistics and transport sector also needs to clean up its own act. It’s a major contributor to climate change and the largest-emitting sector in most developed countries, accounting for just over a third of global carbon dioxide (CO2) emissions. 

That means there’s a lot of work to do — and also a major opportunity. The global green logistics or sustainable logistics market is predicted to grow at a CAGR of 6.1% between 2021 and 2028, bringing benefits such as: 

• Overall lower emissions
• Prevention of reputational damage
• Increased employee engagement and retention. 51% of all employees, and an even higher proportion of millennials and Gen Z, don’t want to work for companies that are part of the problem. 
• Increased efficiency across the supply chain. 

So, what are the major trends to look out for in 2024? Let’s take a look.

Top sustainable delivery trends for 2024

1. Electric vehicles and other green delivery options

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Delivery vehicles are the largest contributor to emissions in the last-mile delivery industry, so this is also where the biggest opportunities lie. We’re likely to see a huge turn away from fossil fuels and an increase in alternative delivery methods, including:

• Increased adoption of bicycles and cargo e-bikes, especially in denser urban areas. (Read how one company in Zurich delivers hundreds of meals per day by bike).
• More availability and variety of electric delivery vans. The global market for electric delivery vehicles is expected to show a massive 18.5% CAGR over the next few years, reaching $44.3 billion by 2030.
• Continued advancements in battery technology, opening the way for electric vehicles with longer ranges and lower cost. 

2. Increased use of AI in logistics

Artificial Intelligence (AI) is transforming businesses and industries everywhere, and the logistics industry is no different. Some of the most important applications for delivery services to watch out for include:

• Route optimization. Efficient route planning for multiple stops is a notoriously difficult mathematical problem — and finally AI is providing a way to solve it easily. Route optimization helps delivery companies reduce the distance driven during the last mile delivery process by up to 30%. Even without using electric vehicles, that makes for much lower fuel consumption. (It also has additional benefits like quicker delivery times and increased profitability — check out Routific’s free trial to see how it works.
• Energy audits. AI can help you analyse last mile logistics data and identify inefficiencies that lead to unnecessary energy consumption.
• Demand forecasting: AI-based inventory management software helps analyse historical customer data and predict inventory needs with more accuracy, again reducing waste and making supply chain management more efficient. 

3. Decarbonization

Decarbonization refers to all the steps a business can take to reduce its carbon footprint and greenhouse gas emissions. Beyond the obvious changes in vehicle choice we mentioned above, we can expect more and more companies to broaden their approach to decarbonisation. For example, any company can:

• Ask suppliers what they’re doing to reduce their carbon emissions — and if the answer isn’t good enough, find alternative vendors.
• Choose renewable energy sources as much as possible. This might involve changing providers, or adding solar panels to a building to optimize energy use. 
• Set clear sustainability goals and use a carbon calculator to optimize your efforts.

4. Packaging innovation

One of the unfortunate consequences of the pandemic-fueled rise in online shopping and home delivery was a massive increase in packaging waste. That’s helped to spark increasing demand for sustainable packaging materials. Online retailers and other businesses are turning to eco-friendly packaging solutions to reduce their carbon footprint. These include:

• Using less plastic, and more biodegradable and compostable material.
• More focus on reusable packaging. 

Firms that make these changes earlier can expect to benefit from increased customer loyalty, as consumers grow more conscious of the environmental impact of their purchases. We’re likely to see more and more online retailers advertising their sustainable shipping options as a way to attract customers.

5. Sustainability reporting

As a business, any new process or operation that you undertake should be as much for your customer as it is for your other stakeholders. With that in mind, it is important to report all your sustainability practices and strategies to your customers. Sustainability reporting is a crucial tool for businesses to communicate their environmental, social and governance (ESG) practices transparently.

Businesses can leverage comprehensive sustainability reports to showcase their efforts and progress in their environmental stewardship, and their stance on ethical governance and social responsibility. Sustainability reporting goes a long way in fostering trust and credibility among your investors as well as your customers.