IN THE NEWS: Urban Delivery Hubs Present Solutions to Final-Mile Shipping
Transport Topics
July 23, 2024
Dan Calabrese
FROM THE ARTICLE: It has long been a fact of life for shippers: The most expensive leg of any shipment — whether freight or parcel — is the final-mile leg. The longer the item spends with the last-mile delivery driver, the more it’s going to cost the shipper.
Added in the maze of urban settings, the infrastructure becomes a not-so-friendly environment to semi-tractors hauling 53-foot trailers. Plus, longhaul drivers’ pay structure is not set up to reward them, with all the stops and delays that happen in these cities.
An evolving — and still developing — concept to address the issue is the urban delivery hub (UDH). Described by some as the “Amazonization of last-mile delivery,” the concept has actually been in practice for nearly two decades.
The basic idea: A hub is established near the outskirts of a specific urban area, and longhaul drivers with goods destined for that area bring them all the way to that hub — bypassing regional distribution centers and cross-dock facilities along the way — then leave their haul, even if it’s the entire trailer, for the local delivery partner to take over for final-mile.
The UDH is designed to save shippers money because final-mile delivery only gets involved in the metro area of the final destination, whereas it might cross three or four states coming from a regional distribution center. It’s also designed to make better use of a longhaul driver’s time and miles — getting him or her much closer to the final destination but still not requiring significant travel in the urban center.
But in order for the UDH to work, it requires something most shippers don’t have — volume, and lots of it.
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“You see it already with major retailers,” said Jameson Goforth, vice president of final-mile for Reno-based ITS Logistics. “You saw Home Depot do it 15 years ago with their regional DCs. They were putting them in strategic markets where you could get everything next-day.”
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