View the November 2017 seminar recording
Jennifer Symoun
Good afternoon or good morning to those of you to the West. Welcome to the Talking Freight Seminar Series. My name is Jennifer Symoun and I will moderate today’s seminar. Today’s topic is International Urban Freight (I-NUF) Conference Presentations – Examining and Addressing Urban Goods Movement Needs.
Before I go any further, I do want to let those of you who are calling into the teleconference for the audio know that you need to mute your computer speakers or else you will be hearing your audio over the computer as well.
Today we’ll have a brief introduction given by Genevieve Giuliano, Director of the METRANS Transportation Center and then three presentations, given by:
Today’s seminar will last 90 minutes, with 60 minutes allocated for the speakers, and the final 30 minutes for audience Question and Answer. If during the presentations you think of a question, you can type it into the chat area. Please make sure you send your question to “Everyone” and indicate which presenter your question is for. Presenters will be unable to answer your questions during their presentations, but I will start off the question and answer session with the questions typed into the chat box. If we run out of time and are unable to address all questions we will attempt to get written responses from the presenters to the unanswered questions.
The PowerPoint presentations used during the seminar are available for download from the file download box in the lower right corner of your screen. The presentations will also be available online within the next few weeks, along with a recording and a transcript. I will notify all attendees once these materials are posted online.
Talking Freight seminars are eligible for 1.5 certification maintenance credits for AICP members. In order to obtain credit for today’s seminar, you must have logged in with your first and last name or if you are attending with a group of people you must type your first and last name into the chat box.
PDH certificates are now available for Talking Freight seminars as well. To receive 1.5 PDH credits, you will need to fill out a form. Please see the link in the chat box. Certificates will be emailed one week after the seminar. A seminar agenda has been included in the file download box for those who need to submit an agenda to their licensing agency.
Finally, I encourage everyone to please also download the evaluation form from the file share box and submit this form to me after you have filled it out.
I’m now going to turn it over to Dr. Genevieve Giuliano for a brief introduction before we get into the presentations. Dr. Genevieve Giuliano is Margaret and John Ferraro Chair in Effective Local Government in the Sol Price School of Public Policy, University of Southern California, and Director of the METRANS joint USC and California State University Long Beach Transportation Center. Her research areas include relationships between land use and transportation, transportation policy analysis, travel behavior, and information technology applications in transportation. Current research includes examination of relationships between land use and freight flows, spatial analysis of freight activity location, impacts of freight activities on local communities, and applications for transportation system analysis using archived real-time data. She has published over 170 papers.
Genevieve Giuliano
Thank you very much, Jennifer. Hello everyone and welcome to today's Talking freight seminar. As Jennifer noted, I am the director of the Metro and Transportation center at the University of Southern California in Cal State Long Beach. METRANS held its seventh international urban freight conference in October this year and I am delighted to be able to share with you today some of the research that was presented at the conference. The international urban freight conference was established way back in 2006 and is held every two years. The purpose of the conference is to provide a forum for multidisciplinary research on all aspects of urban freight. The conference draws participants from many disciplines and many parts of the world. We are grateful to the FHWA Office of Freight Management and Operations for hosting this webinar and allowing us to share some of the wonderful research that was presented at the conference. As you might imagine it was not easy to select the speakers from among the more than 100 presentations that took place at the conference. Today's webinar, examining and addressing urban goods movement needs, features three presentations, the first is by Paul Bingham an expert in global trade dynamics and he will speak on industry impacts of urban area freight access.
Johanna Amaya Leal from Iowa State University will present urban freight and initiatives, state-of-the-art and state of this, a topic she has worked on now for some years.
Then, our final speaker, Anne Goodchild from the University of Washington who coincidentally was our keynote speaker at the conference, will speak on the final 50 feet of the urban movement delivery system. I think we have a wonderful line up right here and I think that this is a great present -- illustration of the research that we have been able to share at the conference and I am again grateful that we can share it on this webinar.
Thank you so much and I will now turn his back over to Jennifer.
Jennifer Symoun
Thank you Gen. Our first presentation which will be given by Paul Bingham of the EDR Group. Paul is Vice President of consulting firm Economic Development Research Group. He manages economic analysis of freight transportation and international trade for public sector planners and decision-makers as well as for private sector organizations. He uses TREDIS, TREDPLAN and other software tools and data to quantify outcomes from transportation investments, transportation plan implementation and operational change. He is co-chair of the TRB Task Force on the Value of Transportation Infrastructure and is a former Chair of the TRB Freight Systems Group. He is an appointed member of the U.S. Federal Advisory Committee on Supply Chain Competitiveness.
Paul Bingham
Thank you very much, Jennifer. I appreciate being included in today's Talking Freight webinar and thanks for Federal Highway Administration and also METRANS for being able to participate originally at I-NUF. My presentation today is drawn from a panel presentation made at I-NUF that was a group of speakers on this particular topic and that session was co-organized in conjunction with the TRB urban freight transportation committee. This presentation that you are about to hear from me was in the context of five presentations on the topic of freight impacts on economic development, and environment and society. I was the last speaker in the session that covered other topics including assessing public investment in freight mobility, and there was a presentation on environmental justice analysis for state freight plans and freight corridor studies, a presentation on economic development tied to logistics activity center investments and a presentation on development opportunities and challenges from a new intermodal rail hub facility. So, my presentation attempted to be in the context of that, but then specifically was looking at industry impacts on urban freight access from an economist perspective and importantly, from impacts measured against some baselines. So this really reduced urban freight access impacts in terms of change against whatever would be expected to be seen in a region based on underlying demand it would be on the network. The trend has been reduced urban freight accesses is nationwide, and is seen in most every urban area by many different metrics of freight access and that reduction of access is congestion, delays, infinite delays circuity and is operational constraints I will talk about shortly but fundamentally what is this? It is increased delay reliability of traffic in which freight is a part. Freight exists, coexists multimodaly in urban areas with a passenger movement and as all of that degrades in terms of network performance, it certainly affects freight. What are those impacts mechanically? There are operational cost of having to run overtime and use additional drivers use additional equipment and fundamentally for the commodities that are being moved there is an inventory carrying cost implicitly of any good sitting at rest and not in the position of someone that intends to use it is incurring a cost and that can be quantified. Perhaps, a very infinitesimally small for an individual item or individual unit of time like a minute but in the aggregate for urban areas it adds up to be very significant. We have seen as a consequence of various mitigations steps which we will talk about in some detail that fundamentally it is extending the operating hours to be able to make the same amount of deliveries with the same equipment or the same labor resources to do that, extending shifts or adjusting cutoff times all of which have cost. We have also seen mitigation steps taken both short-term and long-term and those take -- include such steps as even what would be perceived to be in the area of land use planning, dispersion of distribution centers warehousing and operations locations as networks adjust. This is one of the mitigation steps to adjust to the geography of your network including potentially increasing aggregate vehicle miles traveled and emissions and cost of the network attempting to be able to still meet service standards in terms of delivery of the freight.
We've also seen the diversion of shipments to facilities outside urban areas, this is where the traditional centralization and the economies scale of being able to locate freight activity in urban areas become less efficient, as the reduction in access and the increases and congestion cost start to offset some the service potential for urban region serving a larger market. In some cases the associated economic activity is lost to facilities that are then used to divert some of that freight outside of that urban area. Then, practically at the company level we have seen an increase in outsourcing of transportation services for companies specifically in that business, companies no longer attempting to manage their freight, giving up some control, perhaps incurring higher costs and then attempting to deal with the obstacles that they face as congestion increases.
So what are some of the trends we are seeing? This is backed up by lots of summary of research that has already been carried out or is still underway or that you are about to hear on this webinar. Freight dependent businesses are operating more at night and obviously if you can't get it done 9 to 5 you have to push on out into the other hours and we've seen increases in density of operations in the off-peak hours and now even in what you could call the off-off-peak hours to try to find a time when you can make your deliveries efficiently and incur the lowest cost in terms of moving freight in that urban freight network. This has some other issues in terms of safety and runs up against regulatory limits such as hours of service for truck drivers and other workers and transportation services. We've also seen there are some limits on this. The delivery receiving hours are still limited sometimes by regulation, where even if the companies on both sides in terms of freight movement activity and would desire to have a delivery say in the off-peak, but may not be allowed to do that by regulation in terms of land use or anything else which constrains them to be able to optimally manage their operations the way they would like to. But, ultimately businesses pay for this and they pay for the loss of productivity, measured by the carrier seeing fewer returns for regional runs and the other metrics of impediments to the freight movements. We have seen that some of the cost come from having to move to second-tier or third-tier mitigation steps as some of the low hanging fruit of doing something like staggering shifts reaches its implementation limits you can only add the third shift and after that you have to come up with another solution to be able to deal with limitations that you face on performance in the network. The coping mechanism, the methods being employed are many and are still evolving and innovation is growing and quite complex like technology of autonomous vehicles, and several which are quite profound and things I won't address today. Ultimately it increases logistical practices and companies take steps to mitigate the higher cost of congestion. This affects some businesses differently than others, medium-size businesses are perhaps affected uniquely where they have a scale and the volume of business where they have potentially some control and ability to influence how they adopt and use logistics, especially those who are trade oriented or heavily reliant on freight and in some cases have to deal with this very significantly in terms of minimizing costs and staying viable in a market to serve certain costumers.
Part of this is contributed to by the demands on all of the logistic systems from Omni-channel technologies that come from e-commerce distribution and delivery as we are transforming the world of freight movement in terms of commodities that are sold over the internet.. Or, through the internet of things or networks of connectivity and logistics systems that are driving change and fundamentally how the goods demand themselves fundamentally and be managed. We are seeing a specialization in transportation services in the distribution center warehousing technology where a conventional warehouse is not a simple big box with truck doors anymore, we are seeing technology and functions and sizes of facilities being optimized towards the purposes for which they are being constructed or leased. That in some cases leaves some obsolescence in the capital stock and importantly for transportation in where some of the properties are located on the network specifically where facilities that conventionally are warehouses are no longer economically viable place because they don't have some of the more advanced optimization of operations functions available to the customers. We are seeing a shift of third-party logistics and for higher services as mentioned before and this is advancing broadly across industry and I think the only exception of Amazon who is going in the other direction with building out their own private transportation -- multimodal transportation network. This movement to core services is resulting in reduced operating risk, to capital and tie up and labor costs and that is one of the reasons that is driving it, if you can pay someone else for it you don't have to put your own capital at risk in terms of equipment and even necessarily take on the burden of managing your own workforce if you have a contractor handling that for you. This is increasingly attractive for a number of reasons, not just in terms of dealing with congestion but very often that is one of the primary driving factors for adoption of the services in urban areas. Then we have smaller firms that are the greatest users of third-party logistics for hire because they cannot provide those services themselves and that includes both domestic and international operations if they are operating internationally. That puts them at risk, especially where they may have a geographic market presence which is less flexible in terms of being able to move anything that they do to a different location without outsourcing and that is the result of some of that in terms of how you can move it to deal with the impediments that exist in the network. There has been research in recent years on the importance of exports and out of reach markets for urban area economies, and this is important in terms of the proportion of the nation's exports that are increasingly tied to business activity in urban areas, for a host of reasons. But that has the result of the transportation perspective of putting an increasing role on urban freight transportation infrastructure and providing and enabling that economic activity to occur.
Where we are seeing impediments to the performance to those urban markets, in fact it is an impediment towards export related or out of region market jobs that would be tied to urban areas and it becomes a business economic development limitation. Because of the constraints and how it affects the business potential to access those markets from within that urban area. There are some consequences from that that we see quite plainly in the marketplace already. We are already seeing more extensive use of larger trade gateway ports at airports as there is consolidation and larger size equipment and larger size container ships or consolidation and a different mix of air cargo serving for higher value air cargo services both for domestic and international shipment on the air cargo side and that has potential implications for urban areas where the ports and airports are located.
I mentioned before that we are seeing hours of service in the electronic logging devices, and those are limiting driver deployment on the trucking side and that has constraints that affect businesses in terms of their options and choices of what they do operationally and they drive the operation and adoption of other services and practices that are not tied to depending on more use or more intensive use or a greater number of truck drivers.
So, what are the consequences for this for the economy as a whole? Fundamentally it is about congestion limited access and it reduces the business in the city's competitiveness from any economic development perspective, lower level of performance and productivity in the freight network is going to cost the economy of that region in terms of not achieving its potential. Those can be quantified both for the private businesses that have to incur higher costs, but also from the public sector in terms of all of the slow down consequences of the economy from having lower employment lower tax revenues lower level of business activity especially in a competitive context competing with other regions of the country or regions of the world for business activity.
Conventionally we thought about that in terms of reduced access reducing the advantages of the location by raising costs such as I have talked about but there is another way to look at that equivalently which is for the same cost or the same amount of time, you reduce the size of your customer and supplier network within the market that you can reach. That includes the workforce, and that is across the dimensions I have on that slide on the right there, so it can affect the freight delivery routes but also market that you reach and it affects the warehousing and distribution I've talked about in terms of practices and costs of how you obtained goods through suppliers and how you serve your customers through the distribution network. It effects your labor market for the cost and skill you face in the workers you attract to work at your location or those of your customers affected the by the same level of congestion on how you can serve those labor market if you are a provider of labor in terms of where you can deploy those efficiently across the network. Then there is land use implications in operating costs that flow from this in terms of within the urban boundary, how you expect to see land use evolved from businesses that are not necessarily being able to optimize their use of the geography of a region in terms of location and facilities for access on the network. It ultimately affects the quality of life of a region. The bottom line for a politician or a decision-maker who may not be so concerned with freight transport is that this has real impact on all the residents of the region. Ultimately the long-term impact on the left is this affects business retention and if affects business expansion and it affects the ability of a region to attract any of the positive attributes that they would look for in terms of new business investment or business growth and development and the workers that desire to live and work in that region.
I have an example of how this can be quantified, and with the time available, I'm only going to use one but one example –—from where my company developed research (last year) and has attempted to quantify this using a multiregional input and output modeling approach where we attempt to look at the freight dependency at the industry level in terms of how much they have to spend industry by industry on average on freight transport but also regionally, as that varies regionally across the country. And then look at impacts of a change in those freight transportation costs in the urban area for those industries an then, add them all up across all of the industries that are buying and selling to other industries, and look at the indirect and induced affects as well so that we can add to the total impact on the region of some change and access it for freight within an urban area. The example I am using is one in Oregon for Portland Metro, a little while ago where in this graph we have a blue line and an existing level of congestion. Let’s say, volume, capacity, ratio, percentage, time of day, of -- the freight use network for the region. Then, looking forward to 2040, the end of the plan period or study period against which a plan could be implemented. Then in red the amount of congestion and limitations on access that would happen under the baseline, so the forecast baseline growth of the region in terms of business and freight activity translated to travel demand modeling in terms of demand on the network without improvements to that network in terms of what would be, or to enable or facilitate that growth in traffic. And then in the green bars, measuring the implementation of urban freight transportation set of improvements to try to improve the performance and capacity of the network against that future point and measuring the delta is what our model is about, it's that report there on the left and on the right you can see that against the baseline of congestion that reaches over 14% and reduced it down closer to 10%, by the implementation of the improvements made with the investments in the plan. We can add that and say how this actually affects economy locally? What will it do, year by year to the region if we get this kind of improvement on the network and these benefits are accrued year-by-year from the date they are implemented all the way through the end of the study period? Then we piece together the kinds of benefits to see what the conclusion is. But we start with the travel demand model saying, how much time are we going to save by the improvement of the performance of the network and in this case it was a travel demand model and reduction in average driver time and the result without the improvements was a degradation of 69 hours per year per driver spinning congestion, and for the improvements from the plan, fully implemented, that degradation against the baseline was 37 hours per year so that is on an individual worker basis that measured across the plan for those workers
-- [ Inaudible-Static ]
The bottom-line conclusion was the economic benefits for the region in total were over $800 million per year by 2040. That is the sum of the value added for the gross regional products for the region and also includes the quantification of the value of time, so this is the nonmonetary benefits quantified for travelers in terms of travel time savings and improvement in safety and includes societal benefits such as the health effects and reductions in omissions in the region, all total together added up to become a benefit level of over $800 million per year and at almost 6000 jobs so, this is substantial for the Metro region of medium-sized and a freight dependent one like most urban areas are, it can quantify the real impact by 2040 in this case of improvements. Now, how did this play out?
This was added by looking at the freight flows on the network on an industry by industry basis. My last slide here shows a graph, sharing out the total benefits across industry of those improvements to the network. And as you would expect, the greatest benefits go directly to transportation and warehousing, shown in the tan color in the middle, about a third of the benefit accrue in the transportation warehousing service providers in those industry sectors. On the bottom third you see the benefits where conventional you expect to see them in wholesale and retail trade and manufacturing and construction in the region. But very significantly you can see at the top, the service sectors and perhaps unconventionally, the service sectors themselves benefit from improvements in urban freight transport. In fact, about one third of the benefits in the Metro region, they are not necessarily producers of goods for shipping but they are consumers in such a large portion of the network and they are so dependent in ways that are perhaps unconventional, healthcare benefits, actually being dependent on movements of medicine or hazardous waste, they are beneficiaries of improvements for the freight network and can be modified by looking at the dependency of purchasing behavior with industries that supply them in a local economy to see the role. And this is just in terms of the total that could be looked at by workforce dimensions, employment and by other metrics to show how industries at an urban area are affect the by access reductions in the future. With that I am at my time limit and I will turn it over to the next speaker and then we will join you again in Q&A.
Jennifer Symoun
Thank you, Paul. We’ll now have a presentation given by Johanna Amaya Leal of Iowa State University. Dr. Amaya Leal is an Assistant Professor in the Department of Supply Chain and Information Systems at Iowa State University and Associate Research Partner of the Volvo Research and Educational Foundation’s Center of Excellence for Sustainable Urban Freight Systems. She received her B.Sc. in Industrial Engineering from Universidad del Norte, Colombia. She got a M.Sc. in Industrial and Systems Engineering, from University of Florida and completed her PhD. in Transportation Engineering at Rensselaer Polytechnic Institute (RPI). Ms. Amaya is an Eno Fellow and recipient of a Fulbright Scholarship. Her research interests are urban freight transportation, disaster response logistics and operations management. She has been part of multiple projects funded by NCFRP, the National Science Foundation, USAID, and USDOT, among others.
Johanna Amaya Leal
Thank you so much Jennifer, it's a pleasure for me to participate in this talking freight webinar today.
Based on the topic of the title of my first slide I will be presenting an extension of the award I received while doing my Ph.D. research while at RPI on a project funded by the NCFRP. This is an ongoing research and as we know more about the different initiatives available for urban freight, the one we want to dig deeper into them. Of course the input and support from colleagues that are truly appreciated and acknowledged because we have been able to reach a very large audience of practitioners and I will show you later how we end up expanding this research. So let's start with some of the facts regarding freight moving in urban areas. Paul mentioned before that the main impact is made by improving what is going on in transportation and warehousing services or systems. So this is something that we know from before we know congestion has been part of our life since we can remember and in most cases the traffic produced by freight vehicles makes it even harder. As we've seen there are different users trying to use the same limited space and some are more successful than others but, since then we have noticed that things have not changed much, that we have multiple uses and limited capacity and still we need to make sure that the freight is getting to urban areas is distributed and being successful at that is what will be able to keep moving the economy.
So, the movement of freight is growing significantly in urban areas. In the U. S. usually about 80% of the cargo transported has origins or destinations in top metropolitan areas. We know the conception of freight per person varies among the different areas averages about 20% to 30% per day per person, but for a city like New York we can say it is 45 kg. per person, but other cities are smaller such as say Medellin Columbia, is 25 kg. But we still know that the more people are moving to urban areas, there is a need to get more cargo and actually, as people are moving to urban areas, the fact that they are getting better income, their needs change and with that the need for more urban freight is actually increasing the therefore the challenges the system is facing are really high. As a result the freight issues arise and the planners and decision makers have to figure out what to do. How they can improve the services and improve system, but also maintain livable and sustainable communities.
So, what can be done? We can see that a lot can be done. We can actually see that there are plenty of initiative that could be used to implement and mixed and match, in the best way to adapt to the condition of the urban area, large or small and as part of the project funded by the NCFRP working this research that ended up organizing 54 initiatives into 7 groups, and going from supply to demand underpinned by stakeholder engagement. The result was this nice graphic we have here. This basically is showing all potential initiatives available to address freight issues in urban areas and it's actually telling -- one of the results that we saw from analyzing these initiatives, we saw the good and bad of all of those, what is basically the pros and cons and what is even the potential unintended consequences. In many cases during the planning process and all the pressure to different stakeholders and decision-makers, it is overlook. So, we took the time to analyze all those potential and the impacts. We designed a planning guide that basically provided this information and it is available for all decision makers and planners that want to take a look. It is available in two different formats, one is the traditional PDF format that actually is the same as the report that was produced, and also there is an interactive version that will help to move them faster around different sections and still provide nice summaries about the different initiatives without having to look through the whole document.
So one of the ideas and stuff that we have after finishing this is what is next? The work is not done, we know all the analysis and we conducted the analysis of different initiatives and we know the good the bad and benefits and drawbacks of the different initiatives but, what is actually known about this? Are practitioners being able to identify the initiatives and the potential they have? We want to know more about their perceptions of the different initiatives. So, we went ahead and asked.
So this year during summer months we designed and disseminate a survey that asked respondents to identify the city they are most familiar with and then with that in mind we had them answer questions. One, if the initiative that was presented to them was familiar, and if it was implemented in that specific city, and what they considered the most positive and negative impacts of that specific initiative and that applied for all of the 54 initiatives I presented in the graphic before.
We asked about the most positive and negative impacts, we asked for 5 specific impacts, congestion delivery costs, emissions, safety, and livability. They were organizing in a larger scale and we appreciate the fact that several of the participants in the webinar today answered the questions and answered the survey, because this gave us a very nice overview of the participant’s perception in the different initiatives available to be used by the practitioners. So in total we got 75 responses and 48 complete with participation and 21% practitioners and planners 79% researchers and academics and we got information from 19 different countries and 37 cities of different sizes from large to small, having the most represented city of Rome, we had representation in New York City, Paris, London, Mexico, all the way to Sydney and Brussels. This is the map of the different countries that we have represented in the survey and also the different types of cities that we got represented in our sample.
The initial analysis conducted was basically to see how familiar were the practitioners and respondents with the different initiatives and to gather their perceptions on the different impacts. So, I want to start with our initiative that was the most familiar and the most implemented one. 93% of respondents were familiar with the daytime delivery restrictions and of all those the most implemented of all those was vehicle size and weight restriction initiatives. Which is not surprising.
Basically what we have seen before is that these two initiatives that are related to regulations and controlling and making sure the way that freight vehicles can operate is actually taking place. However, we can see that they are not the most effective because according to our analysis, the fact that we are constraining the vehicle sizes and the weight restrictions to be able operate, to we are translating that into more vehicles on the street and increasing emission so that leads basically having more vehicles circulating contributing to more congestion on the roads.
So by regulating some of the restricting operations we are adding additional problems on the roads and most of these initiatives are related to traffic management, and they are the most common -- we need to make sure we recognize that, when we are restricting these we have to take into account what it is actually producing on the other side.
In terms of the least familiar and least implemented initiative we have the vertical height detection system which is not as popular--basically you need IT assistance in place and we recognize the conditions at the local level, may vary from different types of cities so this may not be the best type to implement or even be familiar in urban areas. On the other hand, the least implemented is also having exclusive truck lanes.
We don't usually devote space to vehicles and operations and several projects that have done this have had mixed outcomes. So, it is understandable how it is the least implemented initiative out of all of them.
Based on the different groups that we identified in the planning guide, we are going to give you what is the most familiar and most implemented initiatives. In terms of infrastructure and management we have Ring Roads in terms of most familiar and implemented infrastructure. But it is reaching a limitation. Right now we know that not all cities have the capacity for the luxury to invest in significant amounts of money to invest in a Ring Road they may not have the type of traffic getting into that level, to require one of these. Plus there are others that they already implemented this kind of initiative, and they move on because there's no other way they could improve the supply or capacity on the roads. In terms of parking and loading areas management respondents recognize that there's a need to provide loading for areas for the freight. However, making the space available is tricky. They know that there is a need for off-street or on-street parking loading areas for the freight operations, but in many cases these spaces do not become available for commercial vehicles. In this case they basically tried to come up with ideas and tried to share this space with other users, and come up with delivery windows that at some time of the day the freight vehicles can use the spaces and the other times of the day the passengers need the spaces, and at the end it is limited and in many cases we can see the trucks double parking in the middle of the way and they (just) get tickets because they're violating the law and basically (carriers are saying this is what they have to do in this or that city).
In terms of vehicle-related strategies, the most familiar and implemented initiative is hitting emission standards. We know it is good for the environment, however, it needs to be associated with some sort of incentive because in many cases, the delivery cost goes up, when these types standards are set and they need replacing or upgrading the fleet and that is the part that needs the incentive to be put in place.
For logistical management the most familiar and implanted initiatives is the Urban Consolidation Centers. These are very popular and they have plenty of pilot around the world, however in many cases they don't succeed because they need subsidies to continue operating. Also, the cost of land in urban areas is at a premium, so having a space devoted to operations in the middle of the city, is very expensive and expensive to find space, is definitely not something that is going to be available to be implemented in many cities, at least in the United States.
In terms of pricing incentives and taxation. We found very interesting that the most familiar initiative is road pricing, but it is the least implemented in this group. Which makes sense as many of the practitioners and planners of emissions recognize that a planned road pricing for freight users is not making the same impact as for passenger vehicles. People are able to adapt their schedules, leave early or late, but freight, transport carries, need to make sure they deliver with something that is appropriate with the shipper or receiver. If they don’t make it on time, they basically lose the trip or they may even lose a customer if they don't do it in conditions that were initially contracted. The most implemented in this one is operational incentive for low omissions vehicles and can be tied to the initiative I mentioned before about emission standards. If you actually have a couple of initiatives working together and have the stakeholders involved along the way then it can be more successful. That is one of the key aspects of the initiatives available. You need to make sure that you are covering as many aspects as possible. There is not one single initiative that is going to give you the solution to all the problems.
In terms of freight demand and land-use management. The most familiar is the voluntary off-hour delivery program, this was the aspect of being voluntary not mandatory. And many cities acknowledged the effectiveness of this program, but there is some fear in implementation, especially if they feel that the community is going to complain and there is a need for careful planning and stakeholder engagement to make this successful. On the other hand, the most implemented is the integration of freight in to land use planning and more and more practitioners are thinking about freight before finding the use of land, thinking it's possible to address the issue since the planning stages before actually getting to worse conditions. This will improve the situation in the long run.
Now, let's think about impact. We have five different impacts to responders and it was interesting to see that they believed that 63% of the initiatives improved congestion either significantly or slightly. However, on the other hand that improvement in congestion may lead to increasing delivery cost is also significant or slight increases. Is important to find trade often balances. We need to know how good were doing in the congestion aspect and how it will impact the delivery operations and costs, especially because usually the ones receiving are the ones that are not getting the impact of the cost. Usually the delivery costs are absorbed by the company that is actually doing the transportation service and the fact that the profit in this business is not that high, any minimal increase in the delivery cost is going to be able to put anyone out of business.
We also need to find the initiatives with the highest no positive and no negative effects. We found that night time delivery bans had the highest no positive effect. That is important because it is recognized by the responders that there is a need for flexibility to conduct operations related to freight activity in the off or night hours. That is given some sort of slack so they can actually move operations to these types of hours and be able to continue to maintain the operations ongoing. On the no negative effect, in terms of the general initiatives and relations we found that having IPS is basically something really important and can basically provide positive impact. The same with recognition products. The self-initiative that tries to force us to recognize group practices, however on the other hand, we can say that we also found that any initiative related to stakeholder engagement produces a minimum to no negative effect. Basically trying to educate elected officials, raise awareness about freight, and develop materials to disseminate that information. Share the information about urban policies and practices to the private sectors. They all want to know what's going on instead of being surprised by the different initiatives taking place, it is really important to keep stakeholders engaged. It's a way to identify problems and potential solutions. In many cases it doesn’t need large investments, but they could actually produce very good results. Out of all these initiatives, the highest impact, is to improve private relations. Whenever a new initiatives wants to be evaluated or assessed, this gets accomplished and it brings the best out of the stakeholders. We have champions that want to lead and implement these. Just to close the presentation I will leave you with some thoughts.
We need to improve the freight system performance. There are plenty of initiatives available. There is no magical solution. We need to continue thinking about multiple approaches that could be combined into holistic integrated approaches. Tradeoffs need to be analyzed. If congestion is going to improve, we need to check how delivery costs are going to be changing and try to accomplish a balance. There are underutilized initiatives that could have great potential, let’s think about changes in behavior and especially changes in behavior of those that are demanding supply. They are the ones driving the system. We have to realize and understand that the traditional initiatives do not provide the best impacts, even if practitioners and decision makers are familiar with them but the implementations are actually not taking place.
We need to think as a supply chain, try to identify the key agents that are the key decision makers in this system and foster changes in those. There is a space for collaboration, key stakeholders should be involved since the early stages whenever implementation and the initiative will take place. There is a need to transform the system policy. There is so much going on and innovation with urban freight taking place, let's look at technology. Technology may not be the solution to the problems but it could help to find potential solutions and that will actually help us to use what is available and so with that, I will finish for today and here are some references you can look at coming from this initial project that I mentioned before.
Thank you.
Jennifer Symoun
That slide will stay up for a moment. I will remind you that all the presentations from today are available for download.
Thank you Johanna. Our final presentation will be given by Anne Goodchild of the University of Washington. Professor Goodchild has 20 years of experience leading freight transportation research. By bringing together public sector agencies and private companies her work improves freight transportation system operations. She holds a PhD and MS in Civil and Environmental Engineering from the UC at Berkeley, and a BS (with High Honors) in Mathematics from the UC at Davis. Before attending Berkeley she worked in consulting for five years in Europe and North America for PricewaterhouseCoopers LLP and Applied Decision Analysis Inc. She serves as TRB's Freight Group Chair.
Anne Goodchild
Thank you and welcome everyone and thank you for your time and attention this morning. It is a pleasure to be able to share with you about the Final 50 Feet project that we have been conducting at the University of Washington for about the last year or so. It's a strong collaboration with our partners in the urban freight lab and we both have carriers and retailers represented there as well as the Department of Transportation in the City of Seattle.
The motivation for this project has been touched on already by Paul and Joanna, but the increase in delivery services, some of which is coming from e-commerce and some of which is coming from traditional purchasing, or remote purchasing, be that over the phone, or otherwise, but an increase in delivery services which, in addition to urban growth, has presented some significant congestion challenges that Paul pointed out. These photos are from Seattle, but cities are struggling to manage demand for truck access and these are larger trucks but also box vans who want to access both traditional freight destinations and also increasingly less traditional freight destinations which may not have existing freight receiving infrastructure, so increasingly trucks are relying on curb space and limited curb space to conduct their business.
The City of Seattle in particular has been struggling with this problem and looking for help in understanding how we can serve this truck demand with existing infrastructure, and how we can accommodate the growth, and accommodate changes with a city that was built over the last 100 years to accommodate a somewhat different demand for freight activity. One of the things we discovered in thinking about this problem is that really what is driving the time that a truck needs to sit at the curb or a place that the truck wants to stop, is what is going on inside of buildings. I don't know how many of you have -- I know the lobby in our office looks very much like the picture in the middle, very often and that is, like the receptionist is really serving as a mail delivery node for packages, our homes and apartments are serving as delivery nodes. And the time it takes, or the activities that a truck driver needs to engage in to complete these activities is determined by how that building operates and how the building is laid out and the land use in the city.
So the City of Seattle asked for help in terms of thinking about curb management and truck management but we realized that a lot of the behavior of these trucks was determined by what went on after the driver left the truck. If it takes 20 minutes to actually conduct a delivery the truck has to sit for that 20 minutes. Unlike a transit system where the driver doesn't leave the vehicle. Truck drivers have the additional task of making the delivery, trucks will sit on the curb for as long as it takes the driver to do the work.
So in an effort to reduce dwell time, and to move trucks sort of out of that parking location more quickly we had to address and understand and think about modifications on the delivery side, inside that building potentially. So with our partners in the Urban freight Lab, we set out identifying what the goals of this work would be. And the primary one, as I have alluded to already, was reducing dwell time. If we want to move trucks in and out of load zones more quickly, we have to think about the work they're doing outside of the truck and understand that process and understand how we might be able to reduce the time it takes for that process to occur. One of our measures and improvement metrics has been reducing that dwell time, which will have significant implications for urban freight activity. Our second goal is reducing failed deliveries, this is a cost to everyone and is not desirable to consumers, it's not desirable to the carrier to have to visit the location twice or three times in order to make a single delivery. So, a shared goal of our shipper, carrier, and City partnership has been reducing failed deliveries if we can reduce those we can reduce the number of trips in the amount of activity again that our urban freight infrastructure needs to support.
In order to start this work to reduce dwell time and therefore improve urban freight capacity utilization, to get more work out of the same infrastructure that we already have, we needed to establish some baseline inventories of where that infrastructure is. And, like most cities, the City of Seattle has good geospatial data representing their own infrastructure. They have good GIS layers of roads and curbs and poles and lighting. However, they did not possess good geospatial data with an inventory of any privately held off-street freight loading and unloading capacity.
If we want to think about the urban freight system, and we want to analyze the capacity and look to how changes in curb space management may play out in terms of freight access to locations in the urban area, we need to know what the existing infrastructure is, what its capacity is and where it is located. One of the research activities that we have conducted in Seattle was actually to sidentifying and measure that infrastructure and we now have both the public and the privately held freight infrastructure mapped and available for analysis of capacity for the City of Seattle. We have shared that method that we used broadly so that other cities might be able to undertake the same work. We have done that for the urban center of Seattle. One of the strengths of our collaborations with the private sector has been resolving some uncertainty about those facilities. So, while we walk around and we make physical observations, we find that some of the doors are closed and some of the infrastructure is not observable from the public right-of-way and in One Centre City that was on the previous slide, in that area of Seattle there were actually 548 potential loading bays, but 206 of those were closed but Urban Freight Lab member UPS took the locations of those places and used their institutional knowledge to resolve those almost entirely and identify whether or not the interior there was freight infrastructure that we wanted to include in our inventory.
So, what we know now is that there are 175 internal loading bays, 137 exterior loading docks and 26 interior I'm sorry, exterior loading areas. So, now we know that 87% of all of the buildings downtown actually rely on public infrastructure. So, only 13% of buildings downtown have freight infrastructure, so a loading bay or loading dock to serve them in every other building, 87% use the curb and the city’s alleys in order to serve their freight demand. So we can also begin to look at where those are located and as the city makes changes they are currently removing some of those loading bays -- loading zones on the street and we can anticipate what effect this will have on accessibility of the buildings downtown.
So, as one of the other key pieces of research that I mentioned earlier, we have been understanding the delivery system inside the building and this is particularly significant in very tall buildings, and where the time it takes to travel from the ground floor to all of the destinations in the building is significant and that is the source of delay to any truck on the street. The truck on the street sits there while a driver potentially moves to the 42nd floor to make a delivery. So, we wanted to understand the steps in the delivery process, how long the steps take and then we built a stimulation of that process so we can anticipate how changing that process might affect dwell time on the street, and how we are currently planning some on the ground tests of some of these solutions to validate that simulation with empirical data.
We have done this for five prototype buildings and by prototype we mean they should reflect types of buildings and these include a residential tower, a hotel , a shopping mall, a historic building and also an office tower. We have collected data in all of these using an app and produce a process flow map. The resulting data allows usto measure the variability in the average time it takes for each of these steps to occur.
We have mapped this delivery process, and we show a traditional process here, and there are variations depending on the destination and delivery and type of delivery we have captured on our process flow mapping. We used a real-time app that can really simplify the task of capturing the time elements and can do so with precision both temporally and spatially since it can automatically record the location as well as the time of the event.
This is just an example of the kind of decision process that a driver is going through and we capture the number people who do each of these activities in the building as well as the time it takes. So when we stepped back with the data and we can look at the system as a whole and the time components for each segment of the delivery system, entering the building, takes about a third of the time, that is the parking and getting security clearance and that is obtaining the goods from the back of the truck and approaching the elevator, the delivery times are actually moving with the goods to your destination on average and that took about 40% of that time, and then returning back to the vehicle takes about 25% of the time and so if we anticipate things like a locker system or a delivery point on the first floor for all destinations in the building, we can expect that would significantly reduce delivery time, or this 40%, time in the middle and that will have a spill back, in terms of truck dwelling time. We would save about 8 minutes of the process and we can anticipate that the trucks will not need to wait there for 20 minutes but we could rather produce that to a 12 minute dwell time, effectively doubling the capacity of that curb space.
So, there is quite a bit of variation in some of the steps in particular and there are a lot of differences across building types that we have explored and are exploring and there is quite a bit of richness in terms of how these processes and times are a function of the product that is being delivered, or the type of product, as well as the unique characteristics of the building or the way that building operates.
You can see here the residential building has a much quicker deliveries, and are largely made to the first floor whereas the retail building has a much larger range in terms of distance to the destination.
So, what have we learned from establishing the Final 50 Feet as an important concept that is essential to urban freight activity and performance? We have mapped and identified the steps in the delivery process. And, we have been able to identify potential improvement in that delivery time, and we have simulated those improvements and we are anticipating empirically testing some of those improvements to contrast that with our hypothetical results. We can see what the potential for improvement in the roadside infrastructure will be through some of these changes. I'm happy to take questions and I think that is done through the chat box.
Am I allowed to respond to the one in the chat box now Jennifer?
Jennifer Symoun
Yes, if you want to go ahead that is perfectly fine.
Anne Goodchild
Hi Dan. Dan asked about the information we shared with UPS on doors and whether we share that with the other LTL delivery companies. We did not in this instance. Not because there was a problem or a reason we wouldn't, but just through the relationship we were able to resolve the uncertainty so effectively so we didn't need to reach out anyone else.
Thank you.
Jennifer Symoun
Thank you Anne. I’d now like to start off the Q&A session with the questions posted online. Once we get through those questions, if time allows I’ll open up the phone lines for questions.
Paul this first question is for you. Would the shift to 3rd party logistics/for-hire services transfer to the utilization of privately operated consolidation centers in urban centers within the US?
Paul Bingham
I think generally that is a good example of some of the permutations of service offerings we are seeing in the logistic industry of where third parties are increasingly trying to innovate share practices for space including consolidation centers not just warehouses and distribution centers in urban areas. I'm not sure the direction those will go because there are likely innovations that are leveraging or even dependent on newer technologies, and there is a lots of examples of those in the literature, great examples of things like the Amazon lockers in 7-Elevens, or people doing seasonal shared warehouse space which includes consolidation services on the freight handling for companies. As the digitization of supply-chain progresses with technology, there will probably be more of those custom facility offerings invented or marketed in ways that have not existed in the past and all chasing the minimization of cost or the improvement of reliability serving end customers as shippers. I think that is a good example of those and what we are seeing also is companies, in some cases integrating those kinds of service offerings along with a suite of other services in an attempt to grow in an intermediary space for companies providing transportation logistics services however defined to shippers and receivers including residential customers.
Jennifer Symoun
Thank you. Paul, another question for you, is this an opportunity for the Great Plains region where several medium size metro areas do not have significant congestion?
Paul Bingham
That is a great question, Gloria. There are clearly competitive differences for urban areas in terms of productivity measured and performance of the network. That has a real advantage that can be quantified but I think I would only counsel but it only goes so far because it doesn't make up for the ultimate demand for services that it is focused within and urban area and you are competing on serving that urban area and constrained to underlying demand in terms of population and business mix within the region. But at the margin and the competition for discretionary services where you are competing to provide transportation logistics services for customers in other areas of the country or even the world, then those sorts of urban areas may have an advantage over urban areas that have higher congestion cost and lower productivity for transportation services. I think that is already evident in some of the site location decisions that you see on the part of some companies with large networks taking factors into consideration when they make a site location decision for facility that's going to serve more than a local urban area.
Jennifer Symoun
All right, thank you. Do you see new load matching applications (such as Uber Freight and Convoy) mitigating some of the market access issues in terms of being able to match truck capacity with shippers who need it at a lower cost than via a traditional freight broker?
Paul Bingham
I think the short answer is yes, but I would not over attribute innovation to them in terms of the load matching which is been around for decades in some form or another if you go back to dial a track with a telephone bank decades ago but, ultimately all of those innovations are trying to leverage technology to in some cases, reduce or even eliminate some intermediaries, both in terms of time and cost and the end result of that would be more efficient use of available aggregate capacity. That may extend into vehicles that weren’t previously thought of as freight vehicles where we see Uber drivers making package deliveries or even ideas like for retailers having their own employees use their own vehicles for freight deliveries so that some of that freight capacity gets moved off of and the fleet counts of freight equipment that we've been counting in the past providing data and operational challenges to those of us from the planning perspective of understanding how freight will be moving in the future as these technologies advance and make possible something that was impossible before.
Jennifer Symoun
Thank you. Johanna we now have a question for you. Could you please provide more description of the Freight Quality Council?
Johanna Amaya Leal
Yes. I was checking that and actually, there is a freight partnership, I'm not sure if that's or is what they meant or the freight advisory committee? Those are the two that I mentioned in the initiative. They basically try to support the planning organizations to have a group of different entities representing the freight movement in the area of action that the planning organization has, and they basically have representatives from business from the community from any potential group that could be impacted by the movement of goods in the area that the planning organization is having action on. They basically meet every other time for different activities to take place and how that impacts the freight movement in the city or zone they are trying to analyze.
The freight partnership is a different area for when they work together and impact different movement, there are two different ones, one is local level and one is more at the micro level.
Jennifer Symoun
Anne, how are you estimating the total time to load and sort deliveries for the first floor or single stop in a retail building?
Anne Goodchild
Yes. Thank you. We have done so to date with empirical observations with observers on the ground observing actually measuring the time that that takes. In a couple ways, one in the delivery that is on the first floor but also in a number, maybe all of them, some are made in a destination on the first floor, we are actually able to measure on the ground for some. We have taken the data and built this simulation which can then repeat the times that we have observed empirically and we can also change that and say, what if 40% didn't go to the first floor, what if 20% did what will that do to overall dwell time. We are using the simulation to understand and anticipate improvement or changes and we will also go and physically test some of those things because as you know the simulation is incomplete and it doesn't capture all of the on the ground challenges that we might experience. We will probably start in January but we will actually be making changes to how deliveries are made in one of these buildings at the beginning of next year and again collecting data and comparing that to our simulated data and understanding what the outcomes of meant in terms of dwell times and failed deliveries in the original measures that we had.
There was another question about taking note of any levers for cities to improve the efficiency of freight deliveries. That is absolutely the intent that we will be able to anticipate any changes or levers and for some we will physically test them on the ground as well. We will do the on the ground test for a limited number of changes and the simulation environment allows us to test a lot of things, my students wouldn’t say everything because it still takes some time, and to test a lot of changes in simulated environments. The levers depend, so, you say for cities to improve, some of those changes would be activities that a building manager might need to do and some of those are things that affect the carriers operation and some of those will affect the consumer’s experience. So there are changes with a lot of impact on a lot of the stakeholders and ultimately we want to see improvements in many or all of those and we want to understand how it's going to impact the consumer experience, the carrier experience in the city's experience and even the city and you know that is a number of different objectives. So we're looking into the complexity of that.
Jennifer Symoun
We have a question for Johanna but Paul and Ann feel free to chime in as well. Do you foresee an increasing amount of urban freight deliveries, especially e-commerce deliveries, via bicycle or on foot (handtruck/dolly) in very high density urban areas? Also, do you anticipate various non-industrial buildings in high density areas converted in full or in part for e-commerce related distribution to facilitate urban freight deliveries?
Johanna Amaya Leal
Actually, all of those are happening already so I don't anticipate them happening they are actually happening. There is a significant increase in deliveries to residential areas due to e-commerce, and this is a part of the addition, different initiatives to happening that are trying to induce the buyers to retrieve packages at for example delivery lockers or, and Amazon is including the hubs which basically are trying to secure and minimize attempts to make multiple deliveries.
There is also another initiative in which different buildings have been repurposed, they were old warehouses repurposed as fulfillment centers to minimize the time it takes to make a delivery due to ecommerce. It was a few weeks, then days now a few hours. Land use is changing to fit into the new model to fit with the economy.
In terms of using bicycles, there is now an increase in the market share with the trucking industry. Trucks are available, they are hard to beat, because they are flexible and can go anywhere but there is a shift to new modes and especially if they use bicycles. They are actually being used in high density areas. Not only in the United States but in Europe the they are trying to foster deliveries within a specific range and being able to be there fast. They are using small engines to actually help or assist the biker, and it is making good results.
Jennifer Symoun
Any thoughts from Anne or Paul?
Anne Goodchild
I think Johanna covered it really well. I think those things are happening, particularly in facilities in more urban areas, serving deliveries where we see that happening. I think one thing to remember with foot or bike delivery is that this will be in combination, so that the delivery itself will be multimodal. Again, that happens now, where a truck might bring a load into an urban area and then park, sometimes for a long time, and then an air walker, what some of them are referred to, will conduct the deliveries by foot from that mini pop-up terminal, so the track is almost acting like a facility, and it is mobile and it can come in and park if not for all day then for a few hours and serve a temporary node. Then depending on the environment, walking or biking can be used to deliver from there. Many of you have probably seen the suggestion that we can do the same thing with the drone, so the truck would serve as a base for drone-based deliveries. Some of these modes of delivery are slower overland and you want to get in closer and that could be a fixed facility or truck serving as a temporary node.
Jennifer Symoun
Are delivery stops the same regardless of product or how are you handling or accounting for deliveries to the low income portions of the core city? (Question Repeated)
Anne Goodchild
Are delivery stops the same? No. Delivery stops are not the same, would be the short answer. I do want to comment on the lower income areas of the city, that's been an important part of the Seattle DOT participation in this work, is in improving sort of equity or improving access to these kinds of services in certain parts of the city. There is some evidence that areas of the city are less well served and they are interested in looking to how they can support the availability of services in all parts of city and we are working on that and the other part of equity is carrier equity, and providing broad access to delivery location access to all carriers not preferentially one or other.
Jennifer Symoun
Has there been any communication with the Department of Homeland Security with the heightened truck incidents as in New York recently?
Paul Bingham
The truck used in the attack in New York was a rental truck from Home Depot which probably falls into that category that is harder to track for Homeland Security and anyone else. Neither a traditional rental truck facility business whose primary business is renting equipment, nor was it even a traditional freight truck we think of tracking when we do planning around the freight fleet and that individuals are operating equipment from retailers outside of that conventional set, this is may be an area of weakness that I'm sure Homeland Security is looking at now.
Jennifer Symoun
I did have a question emailed from someone on the phone, what cost, expressed in dollars per ton-mile, do you find in your analysis of urban freight, across the modes? Does anybody have any thoughts on that one?
Paul Bingham
We are getting, where measuring as dollars per ton mile can vary enormously by commodity and time sensitivity of delivery even for the same type of commodity on the geography on the network. The range is enormous in terms of dollars per ton mile, even more so than it was a few years ago.
Jennifer Symoun
All right. We have a few minutes left so let's see if anyone has questions over the phone if the operator can give instructions.
(Operator Instructions)
Robert DiDomenico
My name is Robert, I believe we met in 2015 International Urban Freight Conference, Anne.
I gave a presentation on a new technology in my question is, as you heard about it two years back roughly, what are your thoughts on that type of revolutionary technological approach to installing transportation as a utility, except not for a fungible fluid like water and natural gas or pseudo-fluid, electricity and information, but a stream of physical packets, essentially a tract drone system where the overhead is broadly shared just like the water system is, and the result could wind up being extremely effective and cheap delivery. This could really change the century once it gets started? Any thoughts? Cargo fish.
Anne Goodchild
My thought is you have a much better memory than I do, and that both in terms of when and where we met but also in my ability to recall enough detail to say much at this moment so I think it would be better for us to connect off-line than to me -- for me to speak off-the-cuff, without details at this time but I will put my email in the box and you can get in touch with me.
Robert DiDomenico
In the earlier question on cost per ton mile my analysis does reveal a broad range and it depends on the size and times that city of the delivery, but that in general UPS, overall cost of delivery varies from 500 to 2000 dollars from $500-$2000 per ton mile per parcel and most of that cost as incurred over the last ton miles as opposed to the first 1000 miles. This is incredible when you do the analysis and compare apples to apples keep your units the same five dollars per ton mile in the range goes from 5 ton miles per penny, for the bulkiest of ocean freight, to $50,000 per ton mile to pick up a prescription at the pharmacy drive-through in your SUV. Lots of room, low hanging fruit in urban freight.
Jennifer Symoun
We are out of time so I think we will have to close out for the day. Thank you Robert for calling in with your questions.
I want to thank our presenters and thank everyone for attending today's seminar. The recording will be available online in the next few weeks and I will send an email once it is available. There will also include information about this December seminar. I do encourage you to join the Freight Planning LISTSERV if you have not already done so and there is also a link to obtain PDH credits if you need that. If you do need assistance filling out the form please send me an email and I will help you out as some are unable to access the form. Thank you everybody and enjoy the rest of your day. Have a great Thanksgiving.
