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FORECASTING MONTH: Navigating Ecommerce Growth – Choosing the right tech stack beyond ERP 

Selecting the right technologies plays a pivotal role in facilitating connectivity, driving efficiencies, and ensuring seamless operations as businesses scale and become more complex. A key consideration for many large-scale enterprises is the adoption of an Enterprise Resource Planning (ERP) system. However, the question arises: is an ERP solution really the right technology solution for ambitious online retailers? 

Simon Curd, Chief Product Officer at Linnworks, discusses what an ERP system is and why it might not be the best solution for an ambitious online retailer…

When does a retailer need an ERP?

ERP systems are designed to empower retailers with informed decision-making, trend identification, and the ability to respond swiftly to changes, ultimately reducing costs and providing a more customer-centric shopping experience. Additionally, they streamline communication between departments, enhancing collaboration and efficiency, especially in areas like HR and finance where data centralisation can simplify payroll, employee management, and financial processes.

While the idea of having one system to run your entire business may sound attractive, for many businesses, an ERP system may create more problems than it solves.

Determining the right time for an ERP implementation can be a puzzle for retailers. While there are clear advantages for large-scale enterprise, the complexity, cost, and lack of flexibility can outweigh the benefits for smaller businesses.

Typically, it’s when a business surpasses a revenue threshold of $100 million or more that the need for comprehensive reporting functionalities drives them towards adopting an ERP solution. But, it’s often the business’s need to manage its financial reporting beyond the scope of a more focused accounting package that pushes it toward deploying an ERP solution. However, deploying an ERP system does not come without its risks…

Navigating the risks: Is an ERP an unnecessary expense? 

It’s common knowledge that implementing any ERP system is a lengthy and costly process and one that rarely runs smoothly.

The sheer scale of the project often limits the agility of retailers to adapt their strategy post implementation. This lack of flexibility creates a problem for many online retailers operating in what is still a rapidly evolving and, at times, volatile industry. According to Gartner, between 55% and 75% of all ERP implementations fail, presenting a substantial risk.  Even partial failures that necessitate businesses to retain legacy systems add complexity and potential confusion across the company.

To suit the businesses’ specific needs, customisation is crucial, but it comes at an ongoing cost alongside the initial investment and support fees. Therefore, having the right in-house resources is essential to manage both the implementation and ongoing maintenance effectively.

Building an agile ecommerce business

While modern businesses increasingly demand more sophisticated reporting tools to drive their operations, the scale, complexity, and cost of an ERP system may actually hinder an online retailer’s growth. Rushing into ERP too early may restrict the ability to handle new business opportunities because of their lack of agility. Often, businesses revert to their original specialist systems introducing extra layers of complexity and cost which may ultimately corrupt the information managed by the ERP.

Instead of a one-size-fits-all approach, retailers should look towards specialist solutions tailored to their requirements such as integrating their tech stack with an ecommerce platform like Shopify, BigCommerce, or WooCommerce. In addition, with 50% of online sales happening on online marketplaces, a specialist solution will provide the connectivity and deep integration to major online platforms such as Amazon, eBay and Walmart, as well as newer, emerging marketplaces that provide businesses with first-mover advantage.

In order to gain a competitive edge, businesses can combine specialised vendors and technologies to create highly efficient and customisable IT systems. This allows for faster innovation cycles, incorporating the latest technologies before comprehensive system upgrades are required.

Conclusion

Ambitious, high growth retailers should avoid encumbering themselves with long-running implementation programs that struggle to deliver on the original business benefits. Instead, partnering with a core set of agile, integrated, specialist solutions provides a highly flexible and lower-risk technology landscape that delivers immediate gains as well as providing a long-term foundation for growth and success.

OPINION: Red Sea Crisis underlines the need for greater data transparency

The speed with which shipping companies have responded to the crisis in the Red Sea underlines the growth of digitisation and utilisation of diverse data resources to support complex decision making. But data issues, from ownership to a lack of open integration, remain a challenge explains Captain Steve Bomgardner, Vice President – Shipping & Offshore, Pole Star Global…

Rerouting Confirmed

It is fast becoming clear that shipping companies have evolved beyond their immediate, journey specific response to the escalation of hostilities in the Red Sea to a strategic approach that has been embedded in 2024 plans. Data from Pole Star confirms a significant reduction in the number of vessels using the Red Sea. Despite the additional cost and delay associated with rerouting via the Cape of Good Hope, the number of cargo ships and tankers traveling through the Red Sea dropped almost a quarter in the last few months, from 830 in October 2023 to 626 in February 2024.

Rerouting decisions are, of course, influenced by a number of factors, including cargo, cost and risk perception; but with the cost of war insurance rising, especially for US, UK and Israeli shipping firms, the shift towards the Cape of Good Hope is increasing. For many firms, the experience in March 2021 when the Ever Given container ship blocked the Suez Canal, causing an unprecedented shipping backlog, has provided vital insight to support these rerouting decisions. The additional time required for the Cape of Good Hope route, as well as issues of fuel consumption and emissions, were already understood. Firms have been able to quickly calculate the implications for crew, including the potential need to extend contracts by several weeks and delay the onboarding of new crew members.

This information is now firmly embedded in shipping companies’ emergency response plans, enabling rapid, vessel-by-vessel decision making based on crew costs, fuel and state of repair, balanced against the potential time sensitive nature of the cargo commodity and possible penalties for missed delivery deadlines. What is different this time around is the risk assessment and insurance premium. To the existing baseline calculations, companies are quickly adding the cost of war insurance as well as a vessel-by-vessel perception of risk associated with the targeted nature of attacks.

Data Transparency

This current disruption to global shipping is just one more example of a global supplychain facing constant and ever evolving challenges. The maritime industry increasingly recognises the vital importance of fast access to an array of data sources to support complex risk assessment and rerouting decisions. The rapid digitisation occurring throughout the industry is supporting fast decision making, however emergency response, as well as day to day activity, remains challenged by the lack of open data.

Shipping companies need instant visibility of an array of data from multiple sources, and without open Application Programming Interfaces (API), integrating these diverse data resources is incredibly challenging. The slow, painstaking integration process is adding significant time and cost to digitisation projects, and delaying access to the consolidated information resources and analytics that have the power to transform the speed and power of decision making.

Furthermore, as companies increasingly look to add sensors across their vessels to provide vital information to improve efficiency and safety and support preventative maintenance, uncertainties over data ownership are arising. The shipping company may own the sensor – but the ownership of the valuable data recorded by that sensor, the temperature, fuel consumption or engine emission reading – often turns out to have been retained by the OEM.

Conclusion

Fast access to high quality data is transforming the maritime industry both day to day activity and emergency response. Solutions such as hardware free voyage optimisation systems that deliver fleet monitoring, regulatory compliance, performance analytics and voyage optimisation in a single view are providing a seamless access to vital information both onboard and on shore.

However, these data issues clearly need to be urgently addressed if the maritime industry’s adoption of digitisation is to continue at pace to provide shipping owners with the trusted, real-time insight required to respond to the next emerging crisis.

Dedication to distribution

The challenges of distribution are manyfold. Whether that is looking at your carbon emissions, route planning or team availability, distribution is at the heart of any supply chain. So, from a planning point of view, you need to ensure that once your stock leaves your depot or distribution centre, it is not going to come back.

The first and most obvious reason for a ‘returning’ dispatch unit is incorrect stock. Whether that is an unfulfilled order which needs updating or an incorrect pick, the cost can impact the entire supply chain. Returned deliveries, reissuing of stock, and extra delivery components are all by-products of depot inaccuracy.

Warehouse stock availability is another key area that can cause delivery issues. A lack of clarity on stock availability can lead to repeat deliveries to catch up with ‘On-Shelf Availability’.

So, when we talk about distribution, the first point in any supply chain we need to get right is the start. The processes at the warehouse and distribution centre level are paramount to a successful and efficient delivery model. This includes ‘Origin Checks’ on incoming deliveries from abroad and ‘Pick Accuracy’ on selected lines.

For any warehouse, this is a time-consuming and costly exercise. Using a third-party company such as Orridge Supply Chain Services (SCS), you can remove the paperwork headaches included in supplier discrepancies, and remove the need for vast numbers of team members used to count everything in.

Orridge SCS tailor their services to your supply chain’s specific needs, with the goal of saving you time, money and unnecessary stress. Our independent position means that we can collaborate with suppliers or vendors in a uniquely neutral space, allowing peace of mind in all discrepancy adjustments.

In situations where there is inaccuracy throughout a supply chain, Orridge can offer accuracy benchmarks all the way down to store level, giving you the peace of mind you need to solve any issues.

If you want to get your distribution right, start at the top and work your way down. Orridge Supply Chain Services are here to help you resolve the nagging worries surrounding your distribution challenges.

Returns to Normal

January is a difficult time for retailers and supply chains in general. The dramatic shift from depleted stock to rebuilding inventory causes a strain upon the entire distribution operation. All this, whilst at the same time trying to run business as usual and maintaining customer service levels.

This strain is further compounded by the increase in returns post-December. Unwanted gifts, missed sizes, the need to swap items – January sees a bumper rise in returns and the impact of this has a wide reach. Not only are you going through the now customary stock push for the January Sales period, but you are also trying to process and re-distribute any returns at the same time.

Unchecked returned stock slows processes down at a warehouse level, distracting staff from dispatch, reducing efficiency and increasing storage costs by utilising space.

The knock-on of this returns influx is that delivery and inventory accuracy fall as companies stretch to recuperate their stock and check in their returned goods. This means cashflow is tied up by the ever-increasing pile of returned stock. The solution to this issue is admitting that there is an issue – and doing something about it.

Third party inventory auditors like Orridge can help companies take the strain out of this period by taking on the mantle of increased returns – or checking the accuracy of dispatch.

The benefits of outsourcing inventory maintenance and compliance far outweigh any cost and it’s important to get back to normality as quickly as possible, so problems do not compound problems further down the line. Outsourcing is quick and easy, and is a resource that can be used over a period which suits the business, negating the need to use permanent staff or recruiting and training temporary staff.

Supply Chain leaders need to face into the fact that this is a challenging and disruptive time and spending a little to save a lot makes good commercial sense.

Find out more at https://supply-chain.orridge.eu.

INDUSTRY SPOTLIGHT: PODStar – EPOD & so much more

At its simplest level PODStar is an Electronic Proof of Delivery System (EPOD). Using an Android smart phone or mobile computer, your van or HGV driver can obtain an electronic signature from your client which confirms receipt of the goods or service delivered. If further evidence is required, the driver can take a confirmatory photograph or scan a barcode which the PODStar system will automatically attach to the client record.

The proof of delivery information is immediately transmitted in real time to your back-office system. This allows you to produce invoices for completed jobs, maximising cash flow for your business. PODStar can be fully integrated into your existing back-office WMS, ERP and accounting systems or act as a stand-alone independent system with its own invoicing module.

PODStar is much more than just EPOD. The system has many features associated with modern Transport Management Systems but without the associated additional cost. Core functionality includes Job Planning & Scheduling, Route Planning, Driver & Vehicle Tracking, Vehicle Service Reminders, Vehicle Inspection and Driver Administration (time sheets, expenses, holidays etc.).

What do our clients think?

Our claim to be the number one supplier of EPOD systems in the UK is reinforced by the loyalty and commitment of our client base. Here are just a few testimonies

“In TouchStar we found an organisation whose professionalism extended beyond the excellence of the PODStar product itself, right through to the installation and support aspects of the project. Our delivery drivers appreciate the simplicity and user-friendliness of the system.”

Director, React Transport

“TouchStar’s solution provides DCC with a highly flexible, streamlined and cost-effective operation, eliminating mistakes which arise from a paper-based system and ensuring staff spend their time providing excellent customer service.”

Distribution Manager, DCC 

“Thanks to TouchStar we are now able to have more informed conversations, plan better and offer an improved service to our customers. The solution also gives us a greater degree of accuracy in our conversations with our sales team and of course our customers.”

Head of Logistics Services, CERTAS

Visit https://www.podstar.co.uk

Can the logistics transportation industry thrive by connecting the physical and digital worlds?

Earlier this year, Trimble completed its acquisition of Transporeon, combining the two companies’ North American and European expertise, and enabling the creation of a unified, global transportation management platform that transforms the way the world works. Christopher Keating, Senior Vice President of Trimble Transportation Europe explores this connection in the following byline, as he looks at how the industry can become a digital leader…

Transporting goods from A to B requires close collaboration between shippers, carriers, logistics service providers and recipients. In many ways, how these stakeholders interact with each other and conduct day-to-day operations has remained largely unchanged for the past decade (or more). After all, the industry often still relies on phone conversations, lengthy email chains, paper documentation and manual reporting to coordinate the smooth movement of freight.

But with a raft of digital technologies now available, this is no longer the best approach. Companies could be much more efficient if they embraced ‘phygital’ – the seamless integration of physical and digital systems to enhance their operations. So, what’s holding the industry back from integrating the physical and digital worlds? And where could companies see meaningful gains from adopting a phygital approach?

Old habits die hard

Technologically speaking, much of the logistics transportation industry is stuck in the past, operating a patchwork of disparate tech solutions combined with legacy paper-based processes.

Why? Well, put simply, old habits die hard. Archaic import and export rules (e.g. countries stipulating the use of physical stamps to authenticate and authorise documents) have, until recently, forced companies to continue using paper. Meanwhile, a lack of ‘universal standards’ for digital solutions means that companies have taken vastly different digitalisation trajectories over the past decade. This results in siloed tech stacks that can’t ‘communicate’ with each other, making it hard for companies to accurately understand their order and capacity situation and see whether processes are flowing seamlessly – among other challenges.

The solution? A standardised approach to digitalisation based on a collaborative network, rather than companies working in isolation. Also known as a ‘platform approach’, standardisation provides the foundation for a phygital future, enabling the creation of a transportation network spanning the entire industry. By connecting shippers, carriers, logistics service providers and other stakeholders, companies can simplify communication and slash manual administrative work.

A collaborative approach also enables data-driven decision-making, with companies benefiting from a vast pool of insights that helps all parties get ahead. In the short term, companies can use this data (combined with a high level of automation) to minimise dwell times, optimise yard operations and more. On a long-term basis, it can be used to train AI models to create tools for autonomous procurement or quotation, real-time ETA and everything in between.

New challenges require novel solutions

Embracing a phygital approach won’t just help shippers and carriers enhance overall efficiency, it’s also crucial to helping the industry tackle emerging challenges.

Decarbonisation is arguably the greatest of these, as companies face pressure from governments, end users and fellow industry participants to slash carbon emissions. Sustainability is now impacting the bottom line, with shippers increasingly contracting carriers based on their sustainability credentials, offering extended freight contracts to environmentally responsible companies, and even paying a premium for lower carbon transport.

Decarbonisation isn’t just about investing in expensive, cutting-edge technologies. Companies can make significant progress by implementing digital tools that enhance visibility into existing inefficiencies. With real-time data, they can reduce empty mileage, tackle lengthy dwell times, train employees on sustainable driving practices and combine transport modes to minimise emissions. Again, this is more effective when done collaboratively. For instance, it’s much simpler for carriers to reduce empty mileage by finding a return load if they’re operating as part of a wider network (rather than in a silo). All they have to do is inform the network when they’ve delivered their shipment, and wait for a match from a shipper looking for available capacity.

Another challenge currently facing the industry is the ongoing driver shortage, caused by an ageing workforce and increased demand for logistics services. With driver recruitment set to remain a persistent challenge, shippers and carriers must put their people first. This means taking tangible steps to lessen the administrative burden on drivers and minimise time spent waiting in yards, at ports and in traffic, as well as using tools and technologies to alleviate process-related stress .

To do so, shippers and carriers must first understand where there’s room for improvement. Digital tools can play a crucial role, with companies increasingly turning to real-time insights to uncover hidden inefficiencies and improve visibility by tracing deliveries. In particular, shippers and carriers can make significant efficiencies within the warehouse loading and unloading process, and by automating time slot and yard management processes. This can reduce waiting times from hours to minutes, freeing drivers to spend more time on the road.

The way forward

So, should the logistics transportation industry prepare for a phygital future? In short, yes. Companies already have all the necessary digital tools at their disposal, but success hinges on selecting and implementing them intelligently.

When companies embrace a true phygital approach, they can forget about optimising individual processes, and look holistically at improving their entire system. By embracing platform-based technologies to enhance their physical operations, they can be more efficient, improve visibility and make better decisions. This will help to reduce costs, improve efficiency, and meet customer demands, especially when tackling rapidly evolving challenges like decarbonisation and personnel issues.

Combatting a new era of maritime sanctions evasion

Recent years have seen a notable increase in deceptive shipping practices (DSPs), particularly in the form of AIS spoofing and dark fleet activity. The implementation of Russia-related sanctions and a price cap on the sale of Russian oil and petroleum products has led threat actors to turn towards more sophisticated forms of sanctions evasion. Their aim is to deceive authorities and financial crime compliance programs via the creation of a shadow economy that operates outside of the confines of US, UK, EU, and G-7 law.

Despite the new era of sanctions compliance challenges that such DSPs have created, it is possible to comprehend, detect and mitigate these practices, as Charles Ike, Vice President of Maritime Trade Sales, Pole Star Global, explains…

The challenge: maritime sanction evasion

Sanctions targets require access to allied countries’ markets, including commodities traders; financial institutions; flag registries; and ship charterers (“covered persons”) – all of whom have compliance obligations, including those relating to the price cap on Russian oil.

The Office of Foreign Assets Control (OFAC) and other sanctions authorities have outlined an attestation process to document that Russian oil sales are within the Price Cap.  However, this is not a mere record-keeping problem. The current price cap for oil leaves very little room for margin, meaning threat actors may attempt to falsify documentation, pass goods off as being of non-Russian origin, or violate other sanctions outside the Price Cap – such as acting on behalf of a blocked party or attempting to export oil to an allied country.

The authorities have therefore warned covered persons to be aware of evasion attempts. For instance, in April, OFAC singled out P&I clubs, ship owners, flag registries, and commodities brokers to remain vigilant for DSPs as evidence of sanctions evasion.

In addition, the UK’s National Crime Agency has warned the wider financial community that sanctions targets may use proxies and enablers to gain access to the financial system – access they would otherwise be denied. This advice is equally applicable to the maritime industry.

Illicit dark fleet activity 

There are two primary methods emerging for sanctions evasion: the “dark fleet” and “AIS spoofing”.

The dark fleet is a fleet of tankers owned and operated by persons outside of allied jurisdictions. These tankers – estimated to number around 600 vessels globally – are acquired for trading with Russia or other sanctioned countries.  Owners will go to great lengths to disguise their stakes in these vessels.

That said, dark fleet vessels are not used exclusively for sanctioned trade – and not all vessels will therefore present the same level of risk. For instance, they may be shipping oil within the confines of the Price Cap. However, they do present an increased risk to covered persons. Covered persons should therefore proceed cautiously when dealing with a dark fleet vessel and conduct enhanced due diligence on the provenance of the cargo, the buyer and the seller.

Determining whether a vessel is part of the dark fleet is a subjective process.  A number of criteria and factors must be considered before a ship can be categorised:

Ownership: A vessel’s owner may be tied directly to Russia, Iran, or Venezuela. Likewise, threat actors may attempt to obfuscate their interest by owning the vessel through shell or front companies, or by making rapid changes to a vessel’s declared owners and operators.

Movement: Dark fleet vessels may frequent Russian or sanctioned ports with deliveries to non-allied countries, and/or conduct ship-to-ship transfers in known high-risk zones, such as those used off the coast of Greece.

Deceptive Practices: Consideration for vessels who engage in AIS spoofing or who opportunistically turn off their AIS transponder with the intent of avoiding sanctions.

Timing: The timing of a vessel’s ownership change may indicate an intent to evade sanctions. For instance, moving vessels to new owners directly after the Russian price cap was passed. Likewise, if a vessel makes its first voyage – or routinely makes the same voyages – to Russia or a sanctioned country, this may indicate the vessel was purchased for sanctioned trade.

Fleet coordination: Consideration of a vessel’s changes in conjunction with other vessels owned or operated by the same person. If a fleet of vessels change their flag simultaneously or incorporate into a new high-risk jurisdiction, this may signal that the owner and operators intend to misuse the vessel.

Finally, covered persons should also be aware of the increase in pop-up P&I clubs, outside of the recognised International Group consortium. Thorough and intensified due diligence on the vessel’s owner, operator, or charterer, as well as the source of the cargo, is recommended.

The rise of AIS Spoofing 

Spoofing was once considered a minor part of maritime sanctions evasion, but in the past six months, the practice has surged ahead to become the predominant form of evasion – at least for vessels carrying high-value cargoes such as oil and petroleum products.

In the past, high-risk countries would simply prohibit the export of AIS data, and compliance officers denied access to AIS information. These gaps in AIS coverage were easy to spot. In reaction, there’s been a major shift toward deceptive strategies, which is the provision of false AIS information. That is, inaccurate positional and navigation data is given, making  a vessel appear where it is not.

This presents a far more difficult problem for the maritime community to tackle because threat actors have access to a broader range of spoofing techniques, and maritime intelligence firms will need to keep up with those tactics to counter them. OFAC recommends insurers, flag registries, and ship managers turn to “maritime intelligence services to improve detection of AIS manipulation”.

False AIS data can be uploaded through a variety of means and can be targeted towards individual AIS ground stations and data providers, or through radio frequency broadcasts targeting satellites. Typically, an AIS position is broadcast from a vessel’s transponder, which is then received by either a terrestrial ground station (“T-AIS”) or an overhead satellite (“S-AIS”). This information is then transmitted digitally – such as through an API – to either an AIS aggregator or directly to a maritime intelligence provider.

A threat actor can insert its false data at any point in this chain. Yet, with the right security protocols or an automated ability, receiving sources can discriminate between valid and invalid transponders.

In general, spoofing can be categorised into four typologies, each having distinct signatures:

  • Anchor spoofing” simulates the vessel remaining in the same place for impractical amounts of time. The vessel may appear to be at anchor or may look like offshore storage. However, a review of the vessel’s signal activity or use of human or imagery sources allows us to confirm that it is not the transmitted location.
  • “Circle spoofing” describes a situation where the vessel moves in geometric circles at a set location. Circle spoofing is generally used closer to shores and ports over a few days to a week – which is enough time to visit a sanctioned port and return to the station.
  • “Slow roll spoofing” is when the vessel pretends to be moving in a general direction of travel at very slow speeds. This movement will lack an economic purpose and/or be inconsistent with local traffic patterns.
  • “Pre-programmed route spoofing” is the most realistic technique used. The vessel is programmed to travel along feasible routes. This requires either duplicating or sourcing past AIS data to successfully mimic      the vessel’s movements, or more careful planning is used to ensure that the route appears to have an economic purpose. This methodology is hardly infallible, but is difficult to identify based on a visual inspection of the underlying data.

Conclusion

The threat of maritime sanctions evasion has increased tremendously over the past year. We are now seeing the wholesale creation of fleets for side-stepping allied sanctions, a drastic increase in AIS spoofing and more complex forms of maritime sanctions evasion.

With the threat environment only likely to increase; the onus is on covered persons and those involved in sanctions enforcement to conduct enhanced due diligence on all transactions involving potential dark fleet vessels and eschew – if possible – transactions involving the highest risk fleets, jurisdictions, flags, and classification societies. Working in partnership with providers of maritime intelligence services will be key to ensuring the most up-to-date data is used as part of this due diligence.

Photo by Kurt Cotoaga on Unsplash

Carbon reduction vs carbon offsetting: Choosing the right route for freight decarbonisation

By Serge Schamschula, Head of Ecosystem at Transporeon

In light of the  European Commission’s recent ambitious proposals to enhance the sustainability and efficiency of freight transport across Europe, the need to decarbonise has reached a critical juncture.  This urgency is fueled by the growing concerns of the British public regarding the climate crisis. Consequently, all stakeholders in the UK’s freight industry must be prepared to elucidate the steps they are taking to combat climate change.

To embark on this journey, companies first need to understand precisely how much carbon they’re responsible for emitting, which is no small feat, especially when you consider that any enterprises are yet to adopt a system that effectively measures their scope one emissions (arising from their own production) and scope two emissions (from purchased energy), let alone indirect emissions falling under scope three.

The consequences of all this is that  the accuracy of emissions calculations in the logistics transportation industry is mixed at best. While some companies endeavour to calculate  their own emissions, others rely on generic industry  averages, resulting in discrepancies of up to 55% even within the context of similar full truckloads.

The ascendance of offsetting – a simple solution for decarbonising logistics?

In response to the growing complexity of the situation, there’s now an appetite for ‘quick fix’ solutions. And carbon offsetting – the practice of investing in an activity that compensates for greenhouse gas emissions – has emerged as the lead contender.

Nowadays, companies offer a plethora of offsetting opportunities. Popular choices among them include planting trees or purchasing areas of rainforest to protect them from deforestation. So far, so good. But is planting a tree that will take 20 years to grow really enough to offset carbon emissions created today?

In a word, no. While the need for action is immediate, it takes an average of twenty years for a tree to absorb a surplus of CO2 compared to what it releases. This leaves a significant gap in addressing the urgency of the climate crisis.

In addition to being easy to implement, offsetting is also very affordable, and in some cases, alarmingly so..  Currently, carbon offsetting starts at just £2 per tonne. To put this in perspective, consider the expense of emitting one tonne of carbon through the European Union’s official Emissions Trading Scheme. In this scheme, companies can purchase permits to exceed a predetermined emission cap. Over the past year, the cost has fluctuated between £65 and £105 per tonne, making it up to 50 times more costly than offsetting.

The logical alternative – tangible carbon reduction measures

While carbon offsetting certainly mitigates  unavoidable carbon emissions, it falls short in providing an all encompassing solution for freight decarbonisation. A more robust approach is warranted and shippers, carriers and LSPs are better advised to implement tangible carbon reduction measures.

This starts with measuring emissions as accurately as possible. Only through gaining an understanding of where emissions are coming from, can companies  set effective long-term decarbonisation goals as part of a broader strategy that includes a prioritised list of measures and science-based annual reduction targets encompassing scope one, two and three emissions. Additionally, companies should continually assess their progress against these targets and take corrective measures when necessary.

Decarbonisation isn’t just about investing in expensive, cutting-edge technologies. Considerable strides can be made through incremental improvements that enhance operational efficiency. And  digitalisation plays a crucial role here. Digital tools are easily deployable and require minimal capital expenditure. They empower companies to curtail carbon emissions by facilitating enhanced data sharing and increasing visibility.Armed with the right data, companies can reduce empty mileage, tackle unnecessary dwell times, educate drivers on sustainable driving practices and combine transport modes intelligently to minimise emissions.

However, digitalisation alone isn’t enough. Today, the ‘secret sauce’ for decarbonisation lies in implementing digital tools within a collaborative network. For example,  the industry can drastically reduce empty mileage when different stakeholders work together in a “platform approach” rather than operating in silos.

Looking to the future, the advent of cutting-edge technologies like electric and hydrogen-powered trucks (and even aeroplanes!) will transform the transportation industry and enable freight decarbonisation. Yet, these innovations remain several years away from practical scalability and demand substantial capital investments for their implementation.So, as companies invest in pilot renewable energy projects, it’s also advisable to prioritise the impactful ‘quick wins’ outlined above.

Decarbonising logistics won’t  happen overnight and whilst  offsetting may appear to be a ‘fast-track’ route to sustainability, the reality is far more nuanced. What is truly required  is a multipronged approach that combines short-term efficiency gains, long-term renewable energy projects and some carbon offsetting for unavoidable emissions. This comprehensive strategy paves the way for the industry to embark on a genuinely sustainable path.

Photo by Sam LaRussa on Unsplash

INDUSTRY SPOTLIGHT: Staci – Multichannel logistics powered by experts

Staci provides UK and global multichannel logistics services to some of the worlds best loved and fastest growing brands and retailers. With 78 fulfilment centres across UK, US, Europe and Asia, Staci offers eCommerce fulfilment, multichannel logistics and spare parts fulfilment.

Staci’s strengths of flexibility and expertise creates custom built logistics solutions for every client, ensuring each set of requirements has a purpose built model designed to achieve its unique objectives – not a one size fits all stock model.

Your business is one of a kind – your logistics should be too.

Our 3,000+ experts include our strategic account management team to ensure your logistics continues improving, in house IT development team, and PRINCE2 qualified Project Managers to help integrate your business.

If you’re looking for a futureproofed, seamless peak, multichannel logistics expert to handle your UK or global fulfilment requirements, talk to Staci.

www.staciuk.com

INDUSTRY SPOTLIGHT: Metafour – Market Leading Delivery Software

Streamline your entire delivery process in one, easy-to-use, intuitive cloud platform, that helps Overnight, InternationalSameday, and Last Mile Fulfilment Couriers reduce costs, save time, scale easily, and delight customers.

With 4 decades of expertise and innovation in the courier & mailroom industries, Metafour has developed world-class software that streamlines your entire delivery process, helping companies reduce costs, delight customers and scale fast.

More than 150 companies worldwide use our systems to monitor the flow of parcels, packages, and important documents into, around, and out of their organisations, across their delivery networks.

As a team we pride ourselves on our unrivalled service, covering consultancy, support, training, and maintenance. With 40+ integrations, we have offices in the UK, Africa, and Asia to ensure that you will always receive the best possible service, from your initial enquiry, through the implementation of your project, and beyond.

For further information, please visit www.metafour.com