Advancing City Logistics and Sustainability with Urban Consolidation Centers

Building a future-forward urban supply chain can help meet city needs

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While the pandemic has transformed how and where we work with new hybrid and remote paradigms becoming the norm, the proximity to downtown urban areas remains critical to the success of large organizations. The indispensable asset of an urban location provides corporate and research campuses with many benefits such as access to top talent and clients, brand visibility, and adjacency to centers of excellence.

However, the numerous challenges that accompany this array of advantages demand innovative approaches to managing city logistics. Conducting operations in dense urban areas often includes working with space limitations, encountering and exacerbating street congestion, securing facilities within a complex environment, and generating environmental impacts. Additionally, the rising volume of delivery vehicles on city streets increases congestion, noise, pollution, and often compromises pedestrian safety, and quality of life. As a result, organizations in an urban location with a conventional loading dock and delivery operations are faced with inefficient last mile logistics.

Organizations with a footprint in dense urban environments are continuously looking for ways to improve the resiliency of their supply chains while reducing impacts to the surrounding community. Consolidation Centers for urban deliveries are emerging as powerful solutions, particularly for those with sophisticated on-campus amenities. Urban Consolidation Centers enable a high level of serviceability while alleviating community impact, help organizations deliver further their sustainability goals, foster stronger relationships with communities, reduce truck traffic and obstructive curb-side deliveries, and minimize conflicts with pedestrians and cyclists. In essence, Urban Consolidation Centers can pave the way for more sustainable and resilient supply chains for cities, communities, and businesses.

Logistics for the city

A typical Urban Consolidation Center is a warehouse that receives deliveries from multiple vendors intended for an urban campus. The facility allows goods from multiple suppliers to be consolidated and organized onto fewer and smaller trucks for a more strategic and direct approach to last-mile urban deliveries.
An Urban Consolidation Center is typically in a strategic location just outside of an urban area, usually within a two-hour travel radius, allowing for same-day deliveries to be made from the facility to the urban campus. Depending on the volume of deliveries and area available, urban campuses might also have an on-site consolidation hub to support the last leg of the delivery.

At the Urban Consolidation Center, truck loads are maximized to reduce the number and frequency of deliveries. Urban Consolidation Centers can achieve fleet reductions of as much as 60% to 80%. Gaining control over the last mile also enables deliveries at off-peak hours for a reduction in both street and loading dock congestion. Additionally, since Urban Consolidation Centers promote fewer vehicle miles traveled, they help decarbonize transportation and progress towards sustainability goals.

Responsible campus

Urban Consolidation Centers are generally recommended upon logistics master plans, which integrate a spectrum of operational and sustainability requirements. For large organizations in urban locations, they enable a proactive management of the supply chain that can go from procurement to goods, to last-mile delivery, reverse logistics, and waste management.
A variety of sectors are good candidates for Urban Consolidation Centers, such as science and technology, healthcare and universities. What makes them good candidates are typically one of more of the following characteristics:

• Situated within a downtown area or any similarly constrained dense urban environment.

• The campus typically has 1,000 or more people and a variety of uses and unique amenities that require coordination of a network of vendors and numerous deliveries throughout the day.

• Host complex operations, such as large events, that require preparation and breakdown space on site.

• Comprised of a collection of buildings, often sharing back-of-house spaces and loading infrastructure with multiple groups.

Additionally, these organizations can receive large volumes of mail that need screening and security inspections.

Accelerating sustainability goals

The operational benefits of Urban Consolidation Centers are amplified when combined with sustainable practices. In addition to leveraging the building roof to power clean-energy goals and adopting zero-emission delivery fleets, these facilities can also provide an excellent opportunity for advancing circular economy principles by supporting reverse logistics of materials for end-of-life processing. Waste management of organics, for example, is an area of impact. Centralizing food production from the various kitchens on campus to a central kitchen at the facility promotes waste reduction at its generation point. Moreover, the collection of organic waste on campus for treatment at the facility can close the cycle by increasing the utilization of the fleet and further advance sustainability.

Organic waste technologies, such as anaerobic digesters, can turn an otherwise purposeless material into useful green energy to support net-zero operations on site and also benefitting the local community by creating compost for local producers and diverting waste from landfills. Additionally, Urban Consolidation Centers can improve the visibility of supply chains and materials use, helping to drive down consumption and waste. In turn, this focus can facilitate connections with local producers.

In 2019, Arup began developing and implementing a major supply chain master plan for a rapidly growing global client located within a complex urban district. This client required a comprehensive assessment and adaptation of their last-mile urban logistics as part of its sustained campus expansion. By adopting Urban Consolidation Center strategy, the client will be able to meet its campus growth needs, respond to corporate sustainability goals, provide a high-quality service to the campus and have a positive impact in the community. This engagement is one of many that shed light on the recent strides undertaken by large-scale organizations to transform internal operations and foster sustainable outcomes for their businesses, employees, communities, and the cities in which they operate.

Being a good neighbor

A holistic approach to city logistics is key to fostering sustainable, safe, secure, and efficient operations in our communities. Diverting large trucks from urban districts to Urban Consolidation Centers allows for more appealing, quieter streets and cleaner air, while enhancing the social and economic value for the community. These are objectives many businesses are keen to pursue through their environmental, social, and governance-related goals.

In a more active vein, Urban Consolidation Centers can provide opportunities to give back to the community through partnerships with local organizations, such as local producers, food donation institutions, and multiple educational programs. They can also create economic benefits by providing jobs for local residents within the community.

Public policy has begun to play a significant role in emboldening improvements in logistics practices in dense urban cities. New York City’s programs such as Delivering New York and carbon neutrality pledges signed by several cities around the world have emphasized the criticality of creating a future-forward urban supply chain network.

In 2019, Arup worked with a Business Improvement District in the New York City area to develop a master plan for a Pedestrian Enhanced District with flexible play and commercial streets as well as completely pedestrianized streets. The plan aimed to create a safe and inviting human-scale environment while enabling diverse programming to support the various characteristics of the district. One of the key aspects of the plan was to create a neighborhood-friendly logistics strategy to reduce conflicts between pedestrians and delivery vehicles. To achieve this, a district logistics hub was proposed as a solution to minimize large delivery vehicles from the district core and incorporate pedestrian-friendly modes for the last leg of delivery, therefore reducing delivery conflicts and congestion.

Looking to the future

Intelligent systems and technologies are already a core part of supply chain tracking and enable Urban Consolidation Centers to fully integrate an organization’s logistics solutions. Automated systems can help better control dock operations and schedule deliveries to reduce the number of vehicles and dwell times at the loading dock. Additionally, autonomous robots can be used to transport goods from the Urban Consolidation Centers to or within buildings. These facilities can also serve as a hub to explore emerging automated delivery systems such as drones.

Urban Consolidation Centers are an important gateway for organizations to effectively embrace a holistic logistics process, including the resiliency of their supply chains, decarbonizing operations, improving community relations, integrating technology, embracing automation, and leveraging data to manage the performance and risk profile of their business. Given the challenges of urban growth and climate impacts, Urban Consolidation Centers can provide organizations with tailored solutions for optimizing world-class supply chains to be sustainable, smart, agile, and beneficial for the planet.

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