Going the Extra Mile : Urban Delivery of Large Goods

University essay from KTH/Skolan för industriell teknik och management (ITM)

Abstract: In light of the growing e-commerce and rising population in cities, along with the ongoing climate crisis, the efforts to improve transportation options are intensifying. Thus, the field of last-mile delivery, i.e., the last stretch of transportation to an end customer, is becoming an increasingly researched topic. Innovative delivery solutions, leveraging novel technology or business concepts, are quickly becoming a necessity to retain customer satisfaction while performing sustainable and cost-efficient deliveries. Facing the challenges associated with the last mile is especially arduous in the context of large goods, i.e., packages which are significantly larger than parcels that would fit in a regular mail or post box, and may include furniture, home appliances and other bulky tools. Despite that large goods delivery comprises a large market, there is limited research on how novel last-mile delivery innovations, mainly discussed for application on parcels, can be deployed for larger items. This thesis is an explorative and qualitative study which starts in a background of important trends in transportation, and moves on to provide an analysis of three cities (Barcelona, San Francisco and Seoul), as well as a fourth city (Stockholm) that is both analyzed and considered for implementation. This is done in the form of a case study where data is collected from a literature review as well as interviews with representatives from the company IKEA. Various last-mile delivery concepts are explained and analyzed with Rogers’ diffusion of innovation framework. The research generated insights on how a mixture of different solutions have emerged on the studied markets, mainly based on social, technological and regulatory factors. Although most of them would be theoretically usable for medium to large goods in the future, there are different obstacles to a commercial-scale adoption today, with technological and regulatory maturity being main hurdles. Parcel deliveries play a part in driving customer expectations forward, forcing large goods retailers to evolve their deliveries in order to not lose business. Ecosystems of delivery solutions are likely to emerge in the future, catering to customers’ flexibility demands. In terms of concrete solutions, e-cargo bikes, pick-up points and neighbourhood deliveries are identified as appropriate for the current market state of Stockholm and related third party agreements, physical properties and platforms are discussed in the context of implementation. Additionally, suggestions for future research is to consider further models for generalizing implementation requirements, along with deepening the analysis of last-mile delivery ecosystems by looking into actors for the suggested solutions.

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