From Bricks to Clicks

By Daniel G. Haake, AICP; Jeffrey M. Wojtowicz; and Johanna Amaya, PhD

The rise of e-commerce is impacting more than just our consumption patterns. Fundamental changes in distribution patterns are also shifting — in a big way. What was once a system dominated by heavy truck movements between centralized warehouses and shopping centers now includes a large amount of goods landing right on our own doorsteps.

Today, our neighborhoods are seeing an influx of deliveries. While these drop-offs are taking place via smaller parcel trucks, they are happening at a much higher volume and rate than ever before. And they have important planning implications.

Rise of e-commerce

The best way to describe the escalation of e-commerce is an exercise in self-observation. Ten years ago, how many package deliveries were made to your house in a typical week versus today? A decade ago, I had, at most, one parcel delivery a month. Now I have several a week.

According to the U.S. Census Bureau, e-commerce sales account for 7.8 percent of all retail sales in 2016. There were none at all in 1999. What started as a way to order discount textbooks online now provides daily necessities like toilet paper and dog food.

However, it is not simply the shift in delivery patterns — an increasing frequency of deliveries to the same house, whether from a single source or multiple online merchant — that is impacting our neighborhoods. Rather, it is the rapid fulfillment model that many large e-commerce retailers have adopted to meet the customers' needs (or more precisely wants) at an increasing clearance speed.

Amazon Prime is a — well, prime — example of the rapid pace of e-commerce. Created in 2005, it offers free two-day shipping for an annual fee. Customers order any number of goods per order, or create subscriptions for household goods (diapers and toilet paper, for instance) to be delivered to the home. These goods are then gathered at a local fulfillment center and shipped together, or if an item is unique, it ships from another center. On average, most orders arrive in one or two shipments delivered over two days. Today, there are an estimated 54 million Amazon Prime customers (including one of this article's authors).

Nine years later, Amazon introduced Prime Now, which allows customers (in certain metropolitan areas) to order from a selection of more than 25,000 items, all delivered within a two-hour window. In just under a decade, Amazon's order fulfillment went from 48 hours to two.

Amazon's plan to fulfill customers' immediate needs does not stop there. Recently, the company introduced a new product called Amazon Dash. Dash provides a series of buttons that are strategically placed in a customer's home near selected household goods. When the customer is running low on detergent, a push of the button sends a new shipment on its way.

The results of these changes are highlighted by recent research published in the journal Transportation Research Part C and undertaken by Xiaokun Wang and Yiwei Zhou at Rensselaer Polytechnic Institute. They found that new National Household Travel Survey data indicates that "freight trips generated by residential units have comparable magnitude as the freight trips generated by businesses."

So what does this mean for our communities? And how do planners prepare neighborhoods for the influx of freight traffic?

Neighborhood effects

While goods movement is a physical manifestation of a growing economy, it creates several negative effects. In the case of e-commerce, those negative impacts are very local.

Most neighborhood streets are not designed to handle significant truck traffic — the most obvious results being congestion from parked delivery vehicles in the roadway and safety concerns. While not as visible, noise and pavement damage from the increased heavy loads are directly related to a neighborhood's quality of life. Similarly, idling vehicles can have a local impact on air quality.

Mitigation strategies

While many will dismiss these concerns based on forgone conclusions about the impact of some future "disruptive" technology — like drones or 3-D printing — planners must focus on addressing the immediate and long-term impacts of e-commerce on our neighborhoods regardless of how deliveries are ultimately carried out.

As a planner, what are you ultimately trying to do? Your goal should be to mitigate the negative impacts of an advancement in technology that will (arguably) improve your community's quality of life — not improve neighborhood truck throughput.

What's more helpful is determining what strategies planners can employ to mitigate the impact of increased deliveries, while supporting the quality of life improvements that come with realtime order fulfillment.

Traditionally, the answer to these challenges would be thicker pavement standards and wider streets to meet the requirements of large delivery vehicles. It's easy to fall into the trap of focusing on the trucks and not the neighborhood. Improved pavement standards may need to be part of the solution in some new subdivision developments. However, wider streets come with a different set of unintended consequences, and they're counterproductive to neighborhood safety and quality of life.

It is important to remember to see the forest for the trees. As a planner, what are you ultimately trying to do? Your goal should be to mitigate the negative impacts of an advancement in technology that will (arguably) improve your community's quality of life — not improve neighborhood truck throughput. While this may seem like a given, plenty of communities get lost along the way.

Finding solutions with the freight industry

Conducting outreach and engagement is extremely effective with the freight industry. While planners are accustomed to working within a long-term framework normally established by an ordinance, logistics professionals have a much shorter-term focus.

Take the state of parking in New York City, for example. Most streets there have very little available street parking during the day. Instead of working with the city to increase delivery spaces, freight companies have accepted the fines associated with violating the parking ordinance as a cost of doing business. Annually commercial vehicles pay over $500 million in fines, or about 20 to 30 percent of the city's parking violations.

Engaging with the private sector can prove difficult. But many metropolitan planning organizations and state departments of transportation have established freight advisory councils. These councils meet regularly to discuss freight challenges and work to develop innovative solutions by using the complementary strengths of the public and private sectors. If there is not an FAC in the area, planners could potentially work with the local or state chamber of commerce to break the ice.

Potential short term solutions

Dedicated Delivery Parking. Streets that serve downtown areas, mixed use developments, and other roads we would view as "complete streets" are not always designed — nor do they function well — for deliveries. Typically, parcel trucks have to park close to their customers to make deliveries. The resulting challenge is that those vehicles often double-park, creating congestion and confusion. Similarly, in less dense neighborhoods, trucks will often park across sidewalks and crosswalks to complete their deliveries.

Smaller Delivery Vehicles. A potential solution that requires private-sector participation is the use of smaller parcel delivery vehicles. Companies like UPS and FedEx use different vehicle configurations for different situations. Generally speaking this means smaller or larger trucks.

Some situations call for different types of vehicles altogether, like the golf carts that were used to make UPS holiday deliveries in Dallas and Valdosta, Georgia. In Germany, UPS uses a tricycle to deliver boxes to areas where trucks are prohibited or in tight downtown areas. Similarly, they use ferries in the Outer Banks of the Carolinas and the Upper Peninsula of Michigan. While these are extreme examples of what is possible, it is important to remember that there are always options. However, smaller vehicles equate to more vehicles to deliver the same amount of goods. Which, depending on the vehicle, could mean more congestion and emissions.

Urban Consolidation Centers. Communities could locate shipping centers at strategic locations throughout an urban area to consolidate all delivery trips at what is effectively a cross-docking warehouse. Then one truck would be used to make all deliveries within an area. While this sounds logical, it comes with significant costs. It requires an additional facility, truck trips, and staffing. A significant government subsidy is usually necessary to make this concept financially feasible. The concept has been tested in Europe over 150 times, but only about 20 centers remain operational, even with the subsidy.

Neighborhood Delivery Boxes. While urban consolidation centers might not be a feasible solution, another alternative is to consolidate all neighborhood delivery trips into one area that contains large secure boxes (think P.O. boxes) to limit the number of trips trucks need to take into a neighborhood. While this solution defeats one purpose of ordering online — getting items delivered right to your home — it would mitigate pilferage and significantly decrease truck trips.

Over the long term

While there are no "one-size-fits-all" approaches to mitigating the impacts of e-commerce on neighborhoods, there are solutions that can be successfully undertaken in close partnership with the private sector. E-commerce is still evolving, with disruptive technologies like drones and logistical advances like Uber Rush or Amazon's goal of predictively shipping goods to your home based on past orders.

No matter the method of delivery, our nation is becoming more urban and reliant on e-commerce for our daily needs. Planners must recognize the inherent conflict and act so our neighborhoods can capitalize on the benefits and mitigate any negatives.

Daniel Haake is the senior associate for freight and transportation policy with SRF Consulting in Minneapolis. Jeffrey M. Wojtowicz is a senior research engineer, and Johanna Amaya is a postdoctoral research associate at Rensselaer Polytechnic Institute.