Thomas Schmid from Rapp AG on the Urban Logistics of the Future

Interview with Thomas Schmid, transport and logistics consultant at Rapp Trans AG. The questions were posed by Michael Hauenstein, Head of Marketing & Sales at swissconnect AG. The focus is on urban logistics of the future, particularly on actionable solutions.

(Basel / Lucerne) – Thomas Schmid from Rapp Trans AG has been dealing with urban logistics in Switzerland for several years. On behalf of the Urban Mobility Conference, he has developed a study that outlines what is meant by “urban logistics” or “city logistics.” It also presents conceptual, planning, and regulatory action areas for cities and metropolitan communities. Are you wondering what challenges await courier services that offer express deliveries in city centers and what solutions exist? In the following interview, you will learn more about it.

Hauenstein: Traffic has been growing for years, along with the number of hours spent in traffic jams. At the same time, motor vehicle traffic in cities is increasingly restricted. For many logistics companies, this means that deliveries in cities take longer and become more expensive. Are there any solutions?

Schmid: The traffic areas are known to be limited, and the numerous different users compete for the scarce resource of roads and loading and unloading areas. However, this is merely a peak hour problem; the evening peak, with a combination of leisure, shopping, and commuter traffic, is particularly critical. For courier and express service providers, who make a time promise with their service, the limited reliability and predictability is particularly problematic. There are numerous approaches that service providers can take to deal with this. Firstly, efforts can be made to avoid traffic jams, or the delivery time requested by the customer can be shifted to a less congested time through a traffic jam surcharge or peak pricing. Freight carriers have been charging traffic jam surcharges for several years, and the rising costs must be passed on to users by logistics providers if they want to provide their services at cost and not subsidize them through other businesses. This approach is, of course, not very attractive because it requires some courage and a certain level of self-confidence. At the same time, it is known that customers are very price-sensitive, and there is a risk of losing a customer to a competitor. Secondly, efforts can be made to shift transports to more reliable means of transport. The model of swissconnect AG is a prime example. It shows how the advantages of scheduled, reliable public transport between city centers can be utilized together with agile bicycle couriers on the last mile in city centers. Thirdly, investments can be made to improve numerous other elements in the logistics chain, such as training staff in both dispatch and courier services, in information and communication systems, etc.

Hauenstein: Motorized courier vehicles often get stuck in traffic jams. Additionally, couriers often cannot find suitable spaces in city centers to park their cars/vans while picking up or delivering goods. How should this look in the future?

Schmid: In the theoretical ideal, the loading and unloading of vehicles in urban logistics occurs on private property. No spaces for this are provided on public land. According to the Road Traffic Act SVG Art. 37, there is even the possibility of goods transshipment on the street if vehicles cannot stop outside the road or away from traffic. This has led to the fact that there are still no so-called “stops” and “transfer nodes” for the supply and disposal of households and businesses with goods in urban areas. Individual door delivery is still what customers demand. As long as providers can afford to maintain parallel and redundant delivery services, the situation on the last mile with the numerous KEP vehicles from various providers that have to share the available transshipment areas will not change.

In the future, however, we will increasingly talk about add-on solutions at logistics hosts – the agency model of the post in retail branches falls under this – about open and operator-independent collection and pickup stations – see the KOMO-subsidized project for the Smart Station in Basel – and about micro-hubs (which are transshipment points for goods) from which neighborhoods and settlements are served.

Hauenstein: In the 23 largest Swiss cities, there are locally established bicycle couriers. What role do they play in urban logistics?

Schmid: Bicycle couriers come from the courier business, where the focus is on transporting urgent shipments. To what extent it is possible to use bicycle couriers for the transport of packages and freight with cargo bikes remains open. Rikscha-Taxi or Notime pursue such strategies, and the increasing package volumes during the Corona lockdown have also highlighted the limits of bicycles for KEP service providers. For the transport of, for example, 100 packages, the cargo bike is the right means of transport when these 100 packages need to be transported individually rather than bundled, which is hardly feasible from a business perspective. On one hand, horizontal cooperation models between logistics providers who no longer want to drive the last mile themselves are interesting, or on the other hand, new models of neighborhood logistics where bicycle couriers focus on the last mile and door delivery in neighborhoods. The strategy and business model of the logistics service is crucial, not primarily the means of transport used alone. If bicycle couriers want to play a role in future urban logistics, they should also consider their role at the “stops” and “transfer nodes,” their cooperation partners, and the changing legal framework conditions.

Hauenstein: In addition to physical goods, data is also being transported simultaneously. For example, the customer wants to know when their goods will be delivered, and courier companies want to plan their shipment distribution efficiently. What role does a superordinate logistics software play in managing shipments in individual cities?

Schmid: The control and availability of information across the entire logistics chain is central. Data leads to information, and information leads to knowledge. Those who are ahead in this can manage networks, integrate partners, and maintain the interface with the customer. However, in my view, there is no need for a sovereign instance, nor is it a state task to create and operate a superordinate logistics software. It is important that all parties involved in the logistics chain agree on standards for information exchange so that healthy and fair competition remains and the possibility for horizontal and vertical cooperation is created.

Hauenstein: The control and availability of information across the entire logistics chain is central. Data leads to information and information leads to knowledge. Logistics hubs are used to transship goods. How important are these for functioning city logistics, and are there enough such transshipment areas near cities?

Schmid: We distinguish between different types of logistics hubs. From the rail-connected city hub behind the traffic jam belt to the neighborhood hub to the micro-hub. They are very important for bundling goods flows, transshipment between transport modes, and for the appropriate use of transport modes. Most large and successful logistics providers have been intensively dealing with the strategic development of their networks and logistics hubs for years, and they invest a lot of money in such facilities. The areas to maintain existing facilities in urban areas are under enormous pressure, and finding new areas is even more difficult. However, most cantons and cities in Switzerland have meanwhile recognized that it is five minutes to twelve, and the previously practiced displacement policy of logistics locations from the city should not be continued.

Hauenstein: How will urban logistics in Switzerland look in 5 to 7 years?

Schmid: It will be even more interconnected, cooperative, and greener than today. I hope that the solutions developed during the Corona lockdown will give us further impulses and insights for intelligent urban logistics. I wish that urban logistics will be increasingly recognized as a shared field of design by the economy and the public sector, and that new solutions will be tested and implemented.

Thomas Schmid is a transport and logistics consultant at Rapp Trans AG. Rapp Trans is internationally one of the leading consulting firms in the field of “mobility, traffic, and transport.”

www.rapp.ch www.swissconnect.ch

Photo: © Rapp Trans AG