Author: Dan Berthiaume
Source: CSA The Business of Retail
Online grocer Farmstead is the latest e-commerce retailer looking to deliver goods, not carbon, and maybe save a few bucks in the process.
Farmstead is launching a delivery program called Sustainable Routes the e-tailer says will reduce the number of vehicles it has on the road, lowering both carbon emissions and delivery costs. According to Farmstead, cost savings will be passed to customers in the form of lower prices and free delivery.
Farmstead creates sustainable routes by grouping together neighbors who all receive their Farmstead deliveries during the same day and delivery window each week. This allows the company to deliver to more customers at the same time with fewer vehicles, while giving customers three delivery windows a day, seven days a week.
Farmstead estimates that this approach will take nine to 10 cars off the road for each delivery route that leaves the Farmstead micro-hub in San Francisco. As a neighborhood’s route becomes more sustainable, the company will also offer customers on the route benefits like exclusive product discounts and reduced order minimums.
In addition, customers can invite friends and neighbors to join Farmstead to make their route more sustainable, with order credits available both for the existing and new customers.
“We are committed to making fresh, high-quality groceries accessible to all, while doing our part to make environmentally sound business decisions,” said Pradeep Elankumaran, co-founder and CEO of Farmstead. “This is one of several steps Farmstead is taking to reduce our carbon footprint and lower last-mile delivery costs, and we are proud to work directly with our customers on initiatives to preserve the planet.”
Larger e-commerce retailers are also making efforts to reduce carbon emissions, and in at least some cases remove costs, from their delivery supply chains. Amazon recently introduced Amazon Day, a service that allows Prime members in the U.S. to select one day of the week to be their delivery day.
In addition to increasing the convenience and predictability of Prime deliveries for consumers, Amazon Day also assists the company with its Shipment Zero carbon reduction initiative. By consolidating deliveries, the new delivery option could also give Amazon a way to help lessen its escalating shipping costs. In its most recent fourth quarter, Amazon’s shipping costs rose 23% to $9 billion.
And handmade and vintage goods e-commerce retailer Etsy is making up for carbon emissions caused by its shipments. Each time someone buys an item on Etsy, the e-tailer will automatically purchase verified emissions reductions, more commonly known as “offsets.” These projects include forest protection, wind and solar farms, and development of green production methods for auto parts. Etsy estimates total cost of the program will be about one penny per package.