E-commerce sites can’t afford to neglect their environmental responsibilities. However, going green can be a thorny ambition, particularly for brands selling and shipping parcels ‘cross-border’.
There’s no denying, offering fast international delivery using air freight will have an impact on the planet we’re all trying to protect. A commitment to carbon neutrality in the supply chain is therefore an attractive proposition, and a powerful medium-term fix for our industry.
At Asendia we’re frequently asked by retailers to put a figure on the carbon impact of their parcels, and to provide eco-delivery options to appease growing consumer concerns about climate change. With legislation likely to make carbon reporting mandatory in a few years’ time, it’s now an expectation that parcel shipping partners will provide such data, and greener services. Thankfully, the proactive ones are stepping up to the challenge.
Green innovations in e-commerce logistics
So, what’s being done? A good starting point for retailers and their 3PLs is minimising packaging in the e-commerce delivery channel, and choosing environmentally friendly materials for parcels, labels, and package filling. Electric vans and e-bicycles are now widely used by last-mile couriers around the world. Sustainable Aviation Fuel (SAF) is coming, we are assured by the stakeholders across both fuel producers and airlines that we talk to within the aviation industry.
A commendable development is emerging in sustainable shipping options for e-commerce shoppers. The demand for this is huge. Research from the International Post Corporation[1] (IPC), found that 44% of online shoppers have changed their purchasing behaviour to be more sustainable. Nearly half (49%) stated they would prefer their cross-border parcels to be carbon neutral.
Similarly, a recent ParcelLab survey[2] of US consumers found that 64% are frustrated by unsustainable shipping practices, and 18% said there were no instructions on how to recycle their packaging. Meanwhile last year, Sendcloud research[3] found that green delivery plays an important part in the purchase decision for 74% of UK online consumers, with 15% revealing they’d use a brand that offers green delivery over one that doesn’t.
That said, research – and our own experience – repeatedly finds cost-cautions consumers see additional costs for environmentally-friendly shipping as unfavourable and would rather opt for the standard ‘free shipping’ option. A German survey[4] revealed that one in five Germans is willing to pay more if it helps protect the environment. Respondents said the surcharge should not exceed 5%, however. Clearly, there are limits on the amount e-commerce customers will pay for green delivery. Equally, retailers are asking themselves if they are willing to take a hit to profits, as part of their eco-delivery strategies.
How green can international e-commerce delivery be in 2022?
It seems the biggest challenge for retailers is balancing consumer expectations of rapid delivery times to international destinations, with the need to lower the carbon footprint of every parcel.
There’s currently no way to eliminate carbon emissions from e-commerce shipping, as most of the transportation industry still relies on fossil fuels. Therefore, a popular solution to date has been carbon offsetting in the supply chain, or ‘climate compensated shipping’.
With offsetting, retailers can begin to offer carbon neutral delivery, even when sending orders to international customers. Asendia’s carbon offsetting projects mean that today all of our shipments across more than 200 countries, carried out on behalf of retailers, are 100% carbon-neutral. This includes emissions generated by our delivery partners, road and air transportation, parcel returns, and building and machinery emissions.
In our case, we’ve achieved carbon-neutral delivery by supporting EcoAct verified wind farm projects in India and China, which all comply with the standards of United Nations Clean Development Mechanism[5] (CDM).
We are also able to report the amount of carbon we are offsetting in our regular corporate updates, which is powerful information to share both internally and with external customers and stakeholders.
Beyond offsetting
Offsetting may not be the perfect solution, but while the world awaits innovations such as Sustainable Aviation Fuel and other carbon-cutting developments, we believe it’s a worthwhile way to progress toward our ESG goals.
We’re developing tools for transparency and robust models for carbon reporting on behalf of our retail clients too. Retail businesses need to have a detailed knowledge of their carbon footprint and find long-term solutions to reduce this. Projects on the horizon include a customer-level carbon calculator, and alternative last-mile delivery methods for cross-border flows, including low emission deliveries for cities.
There’s still much to be decided about carbon reporting in aviation, shipping, and trucking. But let’s be realistic. This is not a question of ‘if’, but ‘when’? Carbon reporting simply must be mastered by our industry. And the sooner accredited carbon calculation can be integrated into delivery services, the better.
In the meantime, carbon neutrality achieved through off-setting is strong evidence from shipping partners that they’re serious about addressing the sustainability challenge. In the end, it’s about helping retailers protect their reputation, drive brand loyalty, and act responsibly.
[1] https://www.chargedretail.co.uk/2022/01/31/sustainability-and-brexit-legislation-key-delivery-concerns-for-consumers/
[2] https://parcellab.com/resources/2022-us-consumer-attitudes-to-online-shopping/
[3] https://www.sendcloud.co.uk/sustainable-ecommerce-in-2022/
[4] https://www.umweltbundesamt.de/sites/default/files/medien/376/publikationen/umweltbewusstsein_deutschland_2016_bf.pdf
[5] https://unfccc.int/process-and-meetings/the-kyoto-protocol/mechanisms-under-the-kyoto-protocol/the-clean-development-mechanism
