The role of urban logistics is key to unlocking sustainable, resilient supply chains

The rapid growth of e-commerce has transformed retail and how we shop, with the UK market expected to reach 60 million online shoppers this year. [1]

A smooth and convenient online shopping experience matters more than ever. As retailers look to meet consumers’ growing expectations, the logistics sector has a vital role to play in supporting businesses to create, and maintain, a competitive edge.

With cities across the globe expected to account for 752 million people by 2030 [2], warehousing in urban locations - close to consumers - will become an increasingly valuable asset in reducing the distance of the last mile and strengthening our future supply chains.

Speed matters

Today’s consumers are shopping online for speed and convenience. Research shows that when delivery times are too long, almost half of consumers will shop elsewhere. [3]

With speed a priority, retailers are looking to improve the sustainability of their supply chains and to optimise efficiency, prioritising the capability of their logistics networks to react more quickly to consumer needs. Investing in warehouses and distribution centres in and around cities and close to major transport infrastructure, is where retailers can significantly reduce the distance of the last mile - creating opportunities for faster, and lower-cost, delivery.?

At Goodman, we own, develop and manage state-of-the-art logistics properties in strategic locations across the UK, and globally. Our properties are located in major consumer markets to drive supply chain efficiencies for our customers, reducing transport costs and helping to lower carbon emissions.

Purfleet Commercial Park is a prime example. Located within half a mile of Junction 30/31 of the M25 and just 16 miles from Central London, the 343,281 sq ft warehouse reaches 21 million consumers within a two-hour HGV drive time [4]. With fast connections to the national motorway network, excellent freight links and proximity to three international ports, its location is ideal for retailers serving London and the South East on a same or next-day basis.

?Delivering on environmental commitments

While consumer demand for fast, flexible and low-cost deliveries is creating challenges for retailers, there are also opportunities. If we consider that heavy goods vehicles, including delivery vehicles, make up around 16 per cent of the UK’s domestic transport emissions [5], streamlining the last mile and reducing distance travelled, will benefit our environment and our cities - as well as appeal to today’s climate-conscious consumers.

Recognising the opportunities on offer through a more efficient supply chain, our customers are increasingly seeking space that provides fast and easy access to large consumer populations.

At Goodman’s Crossways Commercial Park in Kent, proximity to London is supporting our customers to reduce transit times and maximise efficiency. Albion Fine Foods, is a premium ingredients supplier to restaurants across London and the South East. By investing in our M25-location, it’s unlocking greater operational efficiencies and delivering best-in-class customer service to support its continued growth and expansion.?

Investing in technology

In addition to location, businesses are increasingly turning to technology to optimise their supply chains. Technology associated with modern last-mile operations can affect 20 - 30 per cent of a business’ delivery costs [6]. If retailers can create cost savings of that amount or more, they stand to gain a significant competitive advantage. Congestion in cities - resulting in lost time and increased costs - is one barrier that could be significantly reduced. This is where data provides an opportunity. Artificial intelligence can quickly identify patterns and trends, which can be used to optimise delivery routes in real time, helping businesses to avoid congestion and save on resources.

Beyond location, having a warehouse that offers operational flexibility will also be crucial for retailers, as they adapt to new environmental targets. Our warehouses incorporate infrastructure for electric vehicle fleets, supporting our customers to transition to more sustainable transport over the long term. This is becoming increasingly important as more UK cities introduce Low Emissions Zones, aimed at encouraging businesses and drivers to use newer, less polluting vehicles.?Our investment in solar technology and on-site renewables is another way we’re working to decarbonise the supply chain, with the incorporation of full rooftops of solar PV providing clean energy solutions - and cost savings - for our customers.

As retail continues to adapt at a rapid pace, Goodman is evolving with it. When it comes to reaching consumers fast and delivering sustainable, flexible fulfilment options, location is key. It’s why our global focus is on delivering space in urban infill locations, where barriers to entry are high and supply is limited. The aim? To support retailers, and the wider supply chain in driving efficiencies and meeting consumer needs.

Charles Crossland is Managing Director for Goodman, UK.

[1] Statista, 2022

[2] Euromonitor, 2021

[3] McKinsey & Company

[4] Esri and Michael Bauer Research, 2021

[5] Clean Technica

[6] Forbes