Author: Carolina Sales, FACTUAL 

Imagine you are a shopkeeper needing to dispatch a delivery to a nearby location. The most straightforward approach would be to contact local Logistics Service Providers (LSPs) to determine the most appealing delivery option. But what defines ‘appealing’? For some, it’s the fastest delivery; for others, the cheapest; or perhaps for others, the most sustainable option. However, more often than not, our decisions are swayed by price.

How do LSPs calculate this price? 

Frequently, the social cost is not included in the LSPs pricing model, as there is no incentive for them to do so. This includes factors like noise pollution, used mode of transport, CO2 emissions, traffic congestion, and the potential for accidents. With a significant surge in last-mile transport, fueled by the growth of e-commerce, especially during the pandemic, incorporating these social costs into the final price is increasingly important. 

And here, public authorities can play a crucial role.

Public authorities can use incentive programs that reward the most socially beneficial delivery options through monetary means and/or loyalty rewards and discounts. This approach could steer end-consumers towards choices that are more advantageous for the community.

Promote sustainable logistics with incentives: Flanders Living Lab

In GREEN-LOG, particularly in Flanders Living Lab, an innovative LaaS (Logistics-as-a-Service) marketplace will be tested in the cities of Leuven, Mechelen and Ghent . This platform aims to streamline interactions between the local commerce and LSPs while promoting more sustainable delivery choices through the use of incentives. By integrating social costs into the final pricing and offering additional rewards and discounts for choosing greener options, this marketplace goes beyond traditional logistics models. 

A key innovation of this system is the integration of RIDEAL, a nudging tool developed by FACTUAL, designed to align offered rewards and discounts with each city’s policies, actively promoting sustainable choices.

With innovative solutions like this, GREEN-LOG aims to transform the logistics sector, steering it towards more environmentally conscious and socially responsible last-mile logistics practices.

To learn more about the marketplace solution, visit GREEN-LOG Project Marketplace Solution.