Exploring Environmentally Sustainable Last-Mile Deliveries in Sweden

Abstract

Last-mile delivery is the part of the e-commerce supply chain that is the least efficient in terms of cost, time, and environmental impact. As e-commerce is expected to keep growing, this puts pressure on last-mile deliveries to reduce their environmental impact if Sweden is to reach its environmental goals for 2045. E-retailers in Sweden are offering their customers a selection of last-mile delivery options, and there is frequent use of sustainability terms (e.g., fossil-free, environmentally friendly) to advertise different options. However, the meaning of these terms seems to not always correlate with the actual environmental impact of the last-mile delivery. This risks creating miscommunication between e-retailers, customers, and logistic service providers, which can lead to confusion and legal implications. The area is still unexplored, and there is limited research on the subject.

The purpose of this thesis was therefore to explore if, how, and why Swedish e-retailers offer environmentally sustainable last-mile deliveries. It was studied with regard to how it is communicated and prioritized in company decisions and which factors affect this. This was explored through a qualitative, exploratory interview study with six of the biggest e-retailers in Sweden. A mapping of the 100 biggest Swedish e-retailers’ delivery options was made to get an overview of the current situation.

The analysis of data from interviews, the mapping, and the literature study was made to understand the factors that influence e-retailers’ decisions on offering and communicating environmentally sustainable last-mile deliveries. These factors were: lack of knowledge, terminology, no comparable measurement for CO2, fear of greenwashing, and the competitive aspect. The e-retailers’ general views on sustainability work were also analyzed. From the analysis, eight propositions were created on how to overcome the current challenges that were detected. These propositions were then grouped into three categories: company priorities, validation, and industry collaboration.

Given the gaps in the area, there is a belief that the results and analysis highlighted in this thesis have practical as well as theoretical contributions to the entire e-commerce industry. The thesis has also provided propositions for how e-retailers can move forward to work more transparently with the environmental impact of the last-mile delivery options they are offering. Hence, the thesis can act as a starting point for future research where it would be beneficial to deep dive into awareness programs, the need for regulations, and the environmental aspect of purchasing goods from e-retailers versus from a physical store.

This thesis has been a complete elaboration between the two authors. Each author has been involved in every part of the process and contributed equally.

Popular Abstract

Making good decisions as a customer is made difficult when different terms are used with the same meaning and the same service is presented with different terms. The jungle of sustainability terms and definitions in Swedish e-commerce today risks doing more harm than good.

With the continuous growth of e-commerce, more and more people can relate to the confusion that can occur when you make an online purchase and reach the step in the check-out where you choose the delivery method. The options usually differ in price, delivery time, delivery location, and environmental impact. The three first-mentioned differences are easy to comprehend, but how are you, as a customer, supposed to understand the difference between a “climate-smart”, “climate offsetting”, “environmentally friendly”, or “fossil-free” delivery? Is there even a difference? And in that case, do the e-retailers know what the difference is?

With the ongoing climate crisis, more and more actors are offering “sustainable” deliveries. To reach climate goals, these deliveries must be sustainable and perform as they promise. As of today, a customer would have to do research in terms of finding definitions, understanding the impact of specific fuels, and more to get a full understanding of what it is they are paying for when choosing a delivery method. This is not realistic, and in fact, it is not legal. According to The Swedish Marketing Act, an actor is required to validate and explain an environmental claim. Still, 92% of the biggest e-retailers that use environmental claims do so without any clarification. Interviews with some of these e-retailers also showed that most of them do not know the correct definition of these terms, even though they are using them on their websites. To support e-retailers in this jungle of sustainability terms and definitions, our research resulted in eight propositions regarding e-retailers’ priorities, validation of the terms, and industry collaboration. The interviews showed that e-retailers tend to prioritize cost and speed in last-mile delivery options. Regarding validation, terms that are as quantifiable as possible should be used, e.g., “fossil-free”, since they are easier to measure and understand by e-retailers and customers. Lastly, to achieve a change in the industry, the e-retailers need to collaborate, e.g., by signing the industry agreement Aster.

Last-mile deliveries might be an area with seemingly limited impact, but they could be indicative of a much bigger picture of how companies resonate with sustainability questions. As last-mile deliveries are the least sustainable part of the distribution chain, a transition towards more environmentally sustainable deliveries and offering this to customers has to become a reality. E-retailers should make it easier for customers to make better decisions because small actions on a large scale can have an enormous impact.

This popular scientific article is derived from the master’s thesis: Exploring Environmentally Sustainable Last-Mile Deliveries in Sweden. The thesis is written by Emelie Ehrensvärd and Clara Wilhelmsson (2023).

• author: Ehrensvärd, Emelie and Wilhelmsson, Clara
• supervisor: Ebba Eriksson
• organization: Engineering Logistics
• course: MTTM05 20231
• year: 2023
• type: H2 - Master's Degree (Two Years)
• subject: Technology and Engineering
• keywords: Last-mile delivery, E-retailer, Sustainable last-mile delivery, Environmentally sustainable last-mile delivery
• report number: 5990
• language: English
• id: 9120865
• date added to LUP: 2023-06-10 21:56:37
• date last changed: 2023-06-10 21:56:37