Faster & Greener - The benefits of sustainable last-mile delivery

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Hi, and welcome to the Sustainability Solved, the sustainable business podcast. I'm Will Richardson. Today we're discussing last-mile delivery and why it's so important, not just for retailers, but for everyone who uses our streets and for the future of our cities. I'm joined by 2 guests who know the industry really well. Chris Benton is the founder and CEO of Oxford-based Pedal and Post, who offer eco-deliveries using cargo bikes. Ben Knowles is the co-founder of Pedalme, who run a fleet of electric cargo bikes which offer same-day deliveries and passenger transport in London. Ben set up the business in 2017 and has recently stepped aside from his role as CEO. Ben, you have a long history of working in sustainable transport for Sustrans and as a transport planner. Why is last-mile delivery so important?

The main reason it's so important is because in cities, just by looking around, you can see how many commercial vehicles there are around you moving around the city space, making it more polluted, making it more dangerous. And if you have a certain amount of motor traffic, then what you find happens is it puts other people off walking and cycling and makes them more likely to drive. Ironically. So if we're really going to tackle this problem of too many motor vehicles in cities, then commercial movements have to be a part of that. And cargo bikes can be transformational in this. It's not just that it's the right thing to do to use cargo bikes, but it's also the more efficient thing to do. So we found in studies with the University of Westminster that cargo bikes could do 60% more deliveries in the same time on multi-drop deliveries around London. Huge amount more efficient, and therefore you can be cost-effective and deliver really positive change that helps other people use walking and cycling to get around too.

Brilliant. And Chris, can you tell us about a typical Pedal and Post client? What do they use your service for?

Oh, we've got a diverse range of clients, so it's everything from You know, probably what you stereotypically think of, of like using sort of big national parcel carriers we work with. They drop off hundreds of parcels into our depot that's just on the outskirts of— we're based in Oxford. We load up the cargo bikes and then disappear. So if you order something online, it will come down to you by bike without you actually realizing half the time. We specialize a lot more in doing medical deliveries as well. So we pioneered a the first delivery service that delivers chemotherapy medication in Oxford, working with Baxter Healthcare and the OUH Trust in Oxford. And we found that it halved delivery times. So the nurses and the doctors and things, they just loved the service from the word go. Just, it's one less thing to worry about in their day. Everything was gonna arrive when it said it was gonna arrive. Congestion isn't gonna— cause an issue. They were really struggling with the previous vans that used to do the contract. They'd have things like road accidents where suddenly the road gets closed and then they're stuck. And it's like, we just have none of these issues. So we just, it's always there.

Yeah. And Oxford's quite a congested city, isn't it?

Yeah. Transport's become a very hot topic in Oxford over the last sort of year or so. They've just launched the new transport plan for Oxford and it includes everything from traffic filters or bus gates. We've got low traffic neighborhoods. We've got quickways, which is essentially putting cycle infrastructure in on arterial roads, removing parking. Like, there's so much good stuff happening, you know, such a short space of time. We've got some really exciting, like, pedestrianization projects as well. There's a very sort of, you know, famous street in Oxford, which is Broad Street, which was basically a car park beforehand. And now the council in the last couple of weeks have ended that and they're changing it and creating kind of like a meadow space and supporting the traders and businesses there. So it's a really exciting time to be working in this space and helping adapt deliveries, which do need to still happen, but bringing it into the 21st century and saying, look, we don't need these big 3.5, 7.5-tonne vans coming into Oxford. We can do it a different way.

And I should have asked this at the beginning, but you guys probably know each other, I would imagine, because of your industry.

Yeah, we've been talking since the very early days of PedalMe. I gave Chris a lift once. There's an industry group that meets up every now and then, and I gave Chris a lift to one of the meetings. Cool.

Awesome. Talking of back in the day, how have things changed for last mile delivery over the last couple of years in the COVID economy, Ben?

I guess everything and nothing has changed over the last few years. The bigger companies can really see that the future is going towards cargo bikes, and they are trying to make use of cargo bikes, but have not been able to achieve the kind of scale of operations that will make a real difference. For PedalMe, we've grown a huge amount. So in 2017, we started with 2 of us. Today, there's about 100 members of staff. Chris, I know, has been on the rampage also. How many staff are you today, Chris? How much have you grown?

Oh, we're pushing 35 cargo bikes in the fleet now and a staff of 22 and starting to kind of build out HQ management team. And I think we're on track for about 100% growth this year, which is just ludicrous to keep up with. And echoing what Ben was saying, we've been approached by a number of big national parcel carriers who have tried using cargo bikes themselves and said, look, It's not what we do. It's not what we're good at. We want to work with partners like yourselves who have the expertise and the knowledge and the staffing and the experience to just go, look, we'll give you the work and the parcels, but you do everything else and have everything branded up and looking nice. And we've seen a massive surge in that, particularly in Oxford.

Yeah, I bet. I bet. That's brilliant. And Ben, can sustainable deliveries work beyond cities? And does that matter? If not—

I absolutely think they can, yes. I think that there will need to be some changes to the design of bikes being used to allow them to cover ground a bit quicker, possibly some changes to regulations to allow higher speeds, but not that much higher is necessary, I don't think, but just a little bit higher, sort of like allowing sort of 25 miles an hour, that kind of thing would really allow rural deliveries to be much more competitive against motor vehicles. The other thing you've got to bear in mind is that the most lucrative markets for logistics are all in the cities. So if the companies that are running cargo bikes outcompete by 60% in urban centers, then they capture the market that's actually profitable. And mainly rural logistics is Mainly loss leading in any case, and so you can just capture all the bits that are making profit and then allow yourself to subsidize in the same way as motor vehicle based logistics companies are doing today. Provide some subsidies so that you can provide national coverage, which then allows for you to capture the entire market in a way that works for the consumer, if that makes sense. There will have to be some use of motor vehicles because HGVs are just incredibly efficient. If you can load up 6,000 deliveries in one HGV and have one movement of sort of 20 tonnes of stuff, to do that even using like the PedalMe methods, you're going to need like 60 vehicles to do that movement. And it would take— that's a lot longer to do that movement if you're moving between cities. So HGVs will always be useful. But the last mile aspect, when we talk about last mile, by the way, We're not actually talking about the literal mile. We're really talking about the last 10 miles. That kind of, that kind of radius is what people mean when they talk about the last mile. And all of that last mile bit, in my view, is doable by cargo bike in a cost-effective manner. It's just that cities provide the greatest advantage for cargo bikes.

We've seen what you've been talking about with the Royal Mail. Over the last 15 years, haven't we, with privatisation and the fact that— I mean, I live in Scotland and I've got relatives living in the Hebrides, and you've seen that exactly the same thing happen. I mean, Amazon don't deliver to the Outer Hebrides. It's not cost-effective for them, so they just don't do it. And you do not want to be in that situation, do you, where actually you're marginalising parts of society Because of the cost.

Yeah, I mean, I think that's why nationalized postal services are a good idea, but that's a whole nother discussion.

Chris, where do you think the drive for sustainable deliveries has to come from? Do you think it's going to be businesses or consumers or a bit of both?

I think it's a bit of both. You tend to find on the consumer side, when we arrive with the bikes, people are super happy to see that it's been done that way. I think a lot of people want to find ways to address the climate crisis that we're in. And a lot of people don't necessarily know how sometimes. We've had a lot of people talk to us about, could we have an option online to choose greener deliveries, even if it costs a little bit more? And we're here to say, look, it costs the same or less. It's not a compromise. And a lot of people's deliveries can just be delivered in cities by bike as normal without them having to see any kind of impacts. A lot of our riders, we have 1-hour time windows. that we have to hit with a particular carrier. And we're finding we're so far ahead compared to what the vans would previously do that we're having to sit around and wait just so we can make sure we're right at the beginning of the time window. So customers are seeing us straight away and we've had to adapt around that and speed things up. But I think businesses are really seeing the benefits too, particularly from a cost and reliability standpoint. For businesses, the green aspect is nice, but that's more of a bonus. You need to be able to compete economically. And I think we worked out we save about £1,500 per courier just avoiding congestion a year. And for us, as a team of 22 couriers, we're saving over £30,000 a year. And they're cost savings that we can either pass on to businesses or they're cost savings that means we can have and pay higher wages. So we're a London Living Wage company now and employ all of our team. So there's lots of kind of Benefits, sort of societal benefits, benefits for consumers and businesses alike. So I think we'll see a really big uptake in this. I mean, that's the carrot side of stuff as well. So you also have the stick side of things, which is things like the ultra-low emission zones are coming in. So people are going to have to adapt to them or pay to enter these zones. You've got congestion zone charges. You've also got low traffic neighborhoods. which cargo bikes can quite easily pass through. And lots of these regulations are coming in now to make our cities more designed for people as opposed to motor vehicles. And it's again, an exciting time to be working in this space.

I think just to come in on the climate change point. So tackling the climate emergency, one of the challenges that's faced by cycle logistics is we have this status quo way of doing things. That's based around using motor vehicles and contractors, and their established business models have captured quite a bit of the market by using these models. And what their preference is, is to just feed in electric vehicles and then say that they're tackling the climate emergency. But in reality, electric cars can only deliver a small percentage reduction in CO2 emissions compared to what is achievable by cargo bikes. So we carried out a lifecycle analysis which has been published, and our CO2 emissions are about 30 grams per kilometer. That's as opposed to about 90 grams per kilometer for an electric vehicle. But that analysis excludes a whole load of extra CO2 that we're not accounting for. So things like constructing highways, motorways, roads, huge amounts of CO2 embedded in that manufacture. There's the embedded carbon in the national grid and infrastructure that's not being accounted for correctly there. So there's huge amounts of difference between using electric vehicles and cargo bikes. And it's really frustrating to see electric vehicles being sold as zero emissions when they're actually nothing of the sort.

Yeah, if anyone sees you on LinkedIn, you talk about this quite a lot on LinkedIn. On that, I mean, how can businesses help educate customers about green delivery options? And have you got any examples?

Well, the best thing is to just talk to your local cargo bike company and make a start because nothing talks louder than action, right? We've managed to do great things for some of the companies we've worked with. Some of those have then chosen to take their own approach to logistics. So like Freddie's Flowers, for example, we started out doing their deliveries by bike in London, got them into the idea, and then they've ended up outsourcing their deliveries to cargo bike companies all over the country. And in some places, we've helped them set up their own cargo bike fleets. And it was really obvious to them that this was really powerful because their flowers were very visibly being delivered by cargo bike, and that was drawing them in customers. So people see these flowers being delivered by cargo bike and then think, oh yes, this is something that I want. So it's not just doing the job of doing the delivery, but it's also doing your sales job at the same time and being cheaper in one move. It's an incredible business move, and it's also really powerful to be showing your values by how you're acting. It's the most powerful way we can inspire change in others is to act ourselves. And I just think it's so, so important. Cargo bikes is one way to do that and a very visible way of doing that. So I think really powerful.

Now, Chris, have you ever been asked to deliver something and had to say no because your fleet wasn't suitable?

I think it's definitely, we'll get stuck in and try. We're not here to replace a cement lorry or We're not going to be replacing a 10-tonne rubbish vehicle at any point. It's all about having the right tool for the right job. And I think this gets played off as a bit of a us versus them kind of thing. Oh, you know, you can't deliver X by bike. And I think we've had a lot of fun with showing what can be done. There's always going to be scenarios that we're not going to be able to do, but I think it's similar to what Ben was saying earlier, like HGVs are brilliant. They're incredibly efficient vehicles, and we're not here to solve that part of it. We're not the silver bullet to all delivery things. It's been really interesting. One of our projects we do is we collect medical samples, blood samples, and test samples from across Oxford. We then put them onto GWR high-speed trains and they get sent down to London and they get unloaded by another Cargobike team. in London and delivered direct to the labs. You know, the trains are doing 125 miles an hour, so road traffic cannot compete with that. And it's kind of intercity projects like that that people don't necessarily know that are going on that are possible as well. So I'm really hoping that these kind of projects expand and we see a lot of the train network get used as well. Specific incidents of something I haven't been able to take? We've done it in multiple trips, but I know one of our clients had, I think, nearly a tonne's worth of wholesale goods, and I think it was coffee and retail items to go out. And we said, well, look, we'll give it a good shot. And I think we took most of the day, but we did get it done eventually.

What about you, Ben? There must have been some funny incidents over the years that you've kind of gone, what, you want us to deliver that?

Pink flamingo.

Pink flamingo. The 15-foot-high pink dodo sculpture that we delivered once. We've helped people move house. There are some things that are quite difficult to do by cargo bike logistics, full kegs of beer. So we recover empty kegs of beer for KegStar, but delivering full ones we can do, but we can only sort of deliver 4 at a time. And that's just one of those jobs that is, if you're delivering in bulk, it just makes more sense for it to go by van. But our analysis shows that about 2/3 of all urban deliveries would be better off, more efficiently done by cargo bike. So there's a huge amount of logistics out there that could be done by a cargo bike and should be done by cargo bike to deliver best value for money. I'm trying to think of something outrageous. I think trees. I think we were asked to move some trees and soil, and it was like half a ton's worth of tree, and they were kind of like 8 meters high or so. I'm only half remembering here. I really wanted us to do it because it would have looked incredible, but sadly it just wasn't quite feasible no matter how we looked at doing it.

Yeah, sliced and diced.

And there are also jobs that we have taken on in the past that probably we wouldn't do again. In the very early days of PedalMe, when we were still working out what was possible, we loaded rolls of fabric onto the front of one of my bikes using a forklift truck, and then I rode them in from Erith to Brick Lane. Broke a load of spokes in doing so, couldn't get the bike on the stand because it was too heavy. This was like really, really early days.

If you can't carry it on yourself, then yeah, not— yeah, don't use a forklift truck to put it on.

But this was like a central part of what's allowed us to discover what the limits really are by cargo bike.

Space is at a premium when you're delivering stuff on a bike. How do you work with customers to avoid wasteful packaging?

About having the sort of right tool for the right job. I mean, we've got a very mixed, diverse fleet, so we've got everything from 2-wheeled bikes that are push bikes to 2-wheeled electric bikes. We've got the bigger e-trikes and 4-wheeled bikes, which are also the 4-wheeled ones made in Oxford as well. And it's just about assigning the right kind of vehicle to the right kind of job. We have a lot of regular clients, so they've seen the bikes out and about, they know what they can do, and it's been fun because we have to be scarily sort of resource and energy efficient. So the bikes have to be like as light as they possibly can to get the maximum range that they can get from the batteries. Then it obviously maximizes the payload that we can carry as well. But you have to balance all of these because we're using bike components. So there's a limit to what you can do under the current regulations and the current kit that exists. So we're carrying as a payload probably about a quarter ton on the back of some of our bikes. So this does enable a whole swathe of work. I think it's around sort of 50 to 60% of inner-city deliveries can be done by bike. And the funnest one I've done so far is probably transporting 10 or 15 bikes for a charity project recently, and it was on like a flatbed pickup-style trike. And we just fully loaded the thing up, went down there, we showed them all what the bike could do, and they were like, Well, let's ditch the van. Can we do this for more delivery jobs instead? Because it's way easier. So even after we've been going pushing 10 years now in the industry, we're still finding bits that are like, this is awesome, we should be doing more of this.

Ben, you've stepped away from PedalMe. What are your plans for the future now? Can you answer?

Yeah, good question. The answer is I don't really know. So historically, the way I've worked is on a project basis. So I'll spend 4 to 6 months learning random things, talking to scientists, doing various types of analysis, and then spot an opportunity and then work on a project. And then typically a project will run for 6 months, 9 months, maybe a year. And then I go back around the cycle again. But of course, PedalMe has been a bit different to that in that it's been a 5 and a half year project. So I'm just spending some time Stopping and thinking about what I want to do next. Important to me to do something that really tackles the climate emergency. I think we're down to the last couple of years really where we can really make a difference on that because of the way these things run nonlinearly. So a couple of degrees of climate change effect, and then that results in melting of the ice caps, which means we capture more heat. Which means that methane hydrates, which have been trapped and frozen at the bottom of the ocean, get released, and then the methane gets released, and then methane traps more heat, and then that sets off the next one. So I think it's really important that we take action, quite urgent action, over the next few years. So I'm in this process of working out where I can have the biggest impact, what skills I'm going to need to have the biggest impact possible, and then apply myself to the next project. I've had all sorts of amazing offers come my way, actually, since people started hearing that I was planning on moving on from PedalMe. Someone suggested that I could lead a party that they were in the process of setting up. I've had various proposals come my way for businesses, joint ventures. I'm kind of really interested in the idea of developing better cargo bikes because I think that's an area that There's a huge amount of development to be done, and there could be much, much better bikes than there are today, allowing many more journeys to be transited over to cargo bike, both in the commercial sector and in the family sector. My background is transport planning, as we talked about earlier on in the podcast, and there are kind of huge opportunities there to deliver benefit as well. So I'm just trying to work out what I do next, where I can have the biggest impact, spending time talking to people, listening, learning. What I'm interested in is where you've got like the cracks in our society where there's a gap between what's rational for people to do and what they're actually doing. And cargo bike logistics is a really obvious example of that, but there are thousands of similar opportunities out there to really dramatically change how we do things for the better, not just for consumers, but also tackling the climate emergency and trying to mitigate that effect downwards, give ourselves as long as possible for technical solutions, and give us the best opportunity to try and avoid the impending disaster that could be.

On that positive note, Yeah. Oh no, good luck. And yeah, you know that I'm really happy to talk as well and see where I can help in any way. I really mean that. I think what you've done is absolutely fantastic.

Really appreciate that, Will. Thank you.

Chris, what does the future hold for you and the business?

So for us at the moment, we're just expanding as rapidly as we can. I think we're set to probably double our team in Oxford, and you know, Oxford's quite sort of a tier 2 city, if you like. It's quite a small population. So we're hoping to venture into tackling some bigger cities. And we have kind of a multi-city roadmap that hopefully we're going to start laying out kind of early next year. We know we either have the option to grow and expand, or we'll end up getting eaten up probably by another company who wants to have a bigger sort of national presence and coverage. But for me, I absolutely love this space. I think talking to Ben, Prior as well, just to the podcast. I think I really liked his analogy of just finding the cracks in society, but jamming a crowbar in there and cracking them open and showing that all of this is possible. We still get it even now when we arrive at people's doors. It's like, you delivered this by bike? Can I come and have a look? And then they see the types of bikes we use and we use 3 and 4-wheeled bikes as well. It's the innovation that's gone on over the last 2 or 3 years is just incredible, particularly with like electric assists and all sorts. So I'm hoping to be in this space for another good 5 to 10 years as a minimum, and you just get stuck in. And I get paid to cycle in one of the most beautiful cities in the UK. What's not to love, really?

Thank you both so much for coming on. It's been an absolute pleasure talking to you and finding out more about last-mile delivery.

It's been great. Thank you, Will.

Thanks so much, Will, and nice to see you again, Ben.

That's it for this edition of Sustainability Solved. If you'd like to learn more about us, you can find a link to the Green Element website on the show notes. We'd also love to hear from you if you have any feedback, or if you have any questions, feel free to DM us @GreenElement through LinkedIn, Twitter, or Facebook. Thanks for listening. I'm Will Richardson. Don't forget to rate and follow the podcast so you don't miss an episode, and we'll be back next month. Until then, take care. Bye.