The Future of Delivery: Urban Freight in 2030
Digitizing urban freight: Are we there yet?
We have digitization to thank for today’s urban freight landscape. Digitization has long been the backbone of things we now take for granted — from TNCs (Transportation Network Companies) Uber and Lyft to online shopping and the complex supply chain needed to make that ecommerce happen. Digitization is what gives ecommerce’s biggest player — Amazon — visibility into its packages and enables it to deliver faster and more reliably than ever. So digitalization definitely isn’t new. But it continues to spur new developments.
Take the Twitterverse’s trending #digitaltwin, the creation and use of a “twin” replica of the physical world — a physical object or objects or system–in a digital landscape. This buzzy advance is being talked about in urban freight research and being used on the street in places like New York City. And it’s just one example of the many changes afoot in digitization.
But what does digitization even mean in urban freight? We can think about three buckets under the broad umbrella. Though all three can — and do — interconnect, the first two center on the public sector and the third on the private sector:
1. Digital infrastructure
Integrating digital technology/smart sensors for self-monitoring and improved decision-making for the public realm.
Digitizing and optimizing curb space, sign/roadway assets, traffic lights, and more.
2. Digital policy
Digitizing public sector policy, rules, and regulations to communicate with users of the urban freight space digitally like creating application programming interfaces (APIs) in addition to physical signage.
Could include digitizing enforcement of rules like red light cameras or automated enforcement.
3. Digital tools
Anything from new software solutions to sensors to cloud storage to advanced computing (like AI or machine learning).
Could include the ability to use "big data" to understand patterns/trends.
In essence, we’re talking about creating and using a digital expression of physical assets or infrastructure, policy that reflects and uses this digital landscape, with tools that make it all possible.
While we know digitization has already sparked dramatic change, that change has been lopsided. The private sector is charging ahead of the public sector, with companies like Amazon and UPS logging decades of supply chain digitization. That said, participants at the fall meeting of the Urban Freight Lab (UFL) touched on opportunities for big changes on the public sector side in digitized infrastructure and policy.
From digitally managing the curb and travel lanes to speed-limiting vehicles for safer, more accessible and more environmentally sustainable streets, possible game-changing public sector advances are expected to open the door to new public-private synergies that could benefit companies and cities alike.
The compelling “whys” behind moves to digitize urban freight were explored throughout the UFL gathering, including:
Access to supply chain data to support real-time decision-making and reduce costs
Improved capabilities to manage dynamic inventory across stores, warehouses, and within vehicles
More transparency across the supply chain for both customers and internal management
Ability to anticipate and avoid service disruptions
Optimization of complex logistics/delivery practices needed to meet customer demands for high speed, quality service, and product choice
Lowered emissions, reduced congestion, and improved safety
Equitable access to public space like the curb.
There seems to be broad consensus that we’re headed toward more digitization to meet the ongoing demands of operating a customer-focused supply chain in a complex, competitive, and unreliable world. While business supply chains are digitization veterans, public sector infrastructure and policy are more recent areas of focus. UFL members shared examples of digitization moves already underway in both the private and public sectors.
What’s happening in digitalization in the public sector freight arena?
1. Digital infrastructure. Cities can better understand and manage the curb–and influence driver behavior–with private companies providing the tech and tools to enable things like data sharing using emerging open-source data standards. A Seattle pilot project, described in a November 2022 UFL study, shows how this can work. Sensors on a sample plot of downtown Seattle streets were used to transmit parking occupancy data to delivery drivers in real time via mobile app. Turns out that real-time information on curb parking availability has a real impact on delivery driver behavior, reducing cruising a parking spot by nearly 30 percent.
This finding shows the opportunity of digital tools and information communicated digitally to save delivery carriers time and boost efficiency. Ultimately, this may help improve safety by giving drivers one less thing to worry about and reducing conflicts between delivery vehicles and other road and curb users. And this approach can help improve traffic throughput, which can reduce congestion and emissions. Meantime, Seattle is hoping to expand its data-driven curb management with a federal grant.
2. Digital policy. When it comes to digital policy and regulation, Lacuna is working with cities in both newer transportation modes (like electric scooters) and legacy modes (like taxis) toward “modern mobility.” When too many of Los Angeles’ 50,000 permitted e-scooters were winding up on Venice Beach, the city transportation agency used Lacuna digital tools to quickly draw a boundary on the beach, deploy a “no drop off” policy and send compliance data to the scooter companies. Within days, Lacuna officials reported, the spike in 311 complaints about the massive piles of scooters had returned to baseline.
At Seattle’s SeaTac Airport, digital tools and policy helped improve navigation. By measuring and responding to real-time vehicle flow and speed, bottlenecks were avoided by diverting drivers to arrivals lanes versus departures lanes and communicating the dynamic policy via LED sign. Lacuna’s simulations suggest that automated interventions could have increased travel speed by as much as 300 percent during untreated congestion periods.
While the examples above aren’t specifically in urban freight, they suggest possibilities in the freight realm.
What’s happening in digitalization in the private sector freight arena?
3. Digital tools. “All transportation companies have become technology companies,” a Lacuna representative told UFL meeting participants. Companies know digitization gives them more access to more information to flag efficiencies that were more hidden before, helping them meet increasing customer demands while containing cost. It can also help them bend behaviors toward safer and greener operations.
Take United Parcel Service (UPS), which has started to use radio frequency identification — or RFID — on packages at 100 facilities in 2022 as part of its “smart package” initiative. UPS says using RFID (which works like a toll tag on a car) will speed throughput, eliminating 20 million manual scans daily for employees loading its package cars, which in turn reduces package missorts and bolsters productivity.
AI company Nauto is putting cameras and sensors on trucks to help mitigate distracted driving and boost safety, then makes timely and comprehensive driving data actionable so drivers can self-coach and fleet managers can more efficiently target their own coaching efforts.
WARP is using digital insights to optimize middle-mile delivery routes, including right-sizing fleets (say, not using an 18-wheeler when a van suffices) and minimizing empty loads. The middle mile in goods delivery typically runs from a warehouse or fulfillment center to a distribution hub before going out for delivery to retailers or wholesale partners. WARP’s platform creates a digital logistics network, connecting different size trucking companies and trucks with cross-docking facilities to move goods more quickly — so a truck stops at a distribution center and its goods immediately get put on another truck instead of being stored inside the warehouse as an intermediate step.
Today, we may not be “there” yet when it comes to digitization. But it seems clear the digitization trend will only continue to accelerate. We expect insights gleaned from digitization to drive efficiencies in both the public and private sectors as we look toward 2030. And with developments across both sectors ongoing, we’re likely to see opportunities for benefits across the entire urban freight system. Stay tuned for future posts that explore further the public-private relationship.