Business to Customer Delivery Alternatives
Published: 2025 March
Business-to-consumer (B2C) delivery alternatives could reduce congestion and lower delivery costs.
Recent increase in business-to-consumer (B2C) delivery services resulting from e-commerce growth have led to challenges for last-mile delivery, including illegal parking, increased noise, emissions and traffic congestion. A recent study by Argonne National Laboratory shows that the number of trucks and stops required for delivery could be significantly reduced by dropping off multiple packages at delivery lockers near households or other delivery locations. Using cargo bikes, where delivery locker usage is not feasible, could bring additional benefits.
Through simulation analysis conducted using POLARIS, Argonne’s agent-based transportation systems simulation framework, researchers have quantified the following B2C benefits:
- Lower delivery costs: reduce fleet size, operational time, and energy consumption by strategically deploying micro-hubs and delivery lockers
- Decrease congestion and associated costs: micro-hubs help consolidate deliveries, reduce the number of trucks, their vehicle miles travelled (VMT) and stops
- Improved safety and logistics: Urban regions as a whole would benefit from improved driver and package safety, lower VMT and more efficient transportation and logistics systems.
- Broader economy improvements: reduction in delivery costs when shared with customers, could improve the entire metropolitan area economic activities.
New optimization algorithms were developed to select micro-hub facilities optimal locations and minimize truck operation time, including hybrid continuous-discrete formulation[1], bi-level meta-heuristic modeling[2], and multi-resolution tour generation.
The study showed that using 20 delivery micro-hubs and cargo bikes throughout the Chicago downtown area could reduce the total number of delivery trucks needed by 2.2% and reduce truck vehicle hour traveled (VHT) by 2.5%. Increasing the share of total B2C delivery package delivered at lockers from 10% to 25% would lead to a reduction of 8.5% travel time and an improvement in energy consumption resulting from lower VMT and higher vehicle speeds.
The study shows that delivery alternatives, such as micro-hubs and cargo bikes, can provide significant benefits especially in dense city areas both from an economical and an energy points of views. Future studies should consider the impact of increased demand to lockers, coordination with energy efficient vehicles and new modes (e.g., e-scooters, e-bikes…)
[1] Osorio, J., Uhm, H. S., Ismael, A., Sahin, O., & Zuniga-Garcia, N. (2025). A Continuous Approximation Model for Large-Scale Delivery Alternative Optimization: Case Study in Chicago Using an Agent-based Simulation Framework. At Transportation Research Board (TRB) Annual Meeting 2025, Washington D.C., USA
[2] Uhm, H. S., Ismael, A., Zuniga-Garcia, N., Sahin, O., Cook, J., Auld, J., & Stinson, M. (2024). Fleet-mix Electric Vehicle Routing Problem for the E-commerce Delivery with Limited Off-Hour Delivery Implementation. arXiv preprint arXiv:2408.00663.