Smart Logistics « Grid » (« Logistique Urbaine Mutualisée Durable »)

1. Smart Logistics « Grid »(« Logistique Urbaine Mutualisée Durable ») Urban Logistics and Sustainable Development EEG2 / TBG3 Transport/Logistics UN/CEFACT meeting PARIS 22-26 February 2010

2. Agenda • Urban freight transportation issues • Concept of the “smart logistic grid” • Benefits • Challenges • LUMD Project • Conclusion

3. Freight « mobility » is becoming an urgent and critical challenge for large cities Increase in population density Intensification of the flow of goods in cities (internal, external) Transportation of goods becoming more difficult and costly Cleaner, less congested and safer environment • A need to transform the way goods are delivered within cities, whether for retailers (small and large, business offices, services,…) Pressure to become more cost-compeitive Limited Infrastructure expansion

4. How to move forward ? • Promote collaboration at all levels • Flow consolidation • Cross-modal transportation • Among customers, suppliers and all levels of government authorities • Leverage technology to better manage transport demand and supply • « Intelligent » transportation solution (planning, real-time monitoring,…) • Comply with International standards for Electronic Exchanges • Manage « last-mile » freight delivery as an integrated service • Across transportation modes • Customer-centric, not resource centric

5. Agenda • Urban freight transportation issues • Concept of the “smart logistic grid” • Benefits • Challenges • LUMD Project • Conclusion

6. Picking Points Picking points Shopping Centers Shopping Centers End Customers End-Customers Retailers Factories Factories Businesses Services Concept : Optimize local deliveries through smart freight consolidation Today Tomorrow Warehouses Urban Freight Consolidation Center (UCC) Retailers Urban Area Urban Area Many Long-Distance Final Deliveries (trucks) (« Supply-Driven Supply Chain ») Few Short-Distance Final Deliveries (multi-modal) (« Demand-driven Supply Chain »)

7. Supplier Delivery Waste Supplier Delivery Retail Shop Multi-Product Freight, non perishable products Multi -Business Retailers, Offices, Shops,… Supplier Delivery Multi-Modal Train, metro, electric vehicle, boats,… Level of consolidation : multi-product / multi-business / multi-modal Supplier Delivery UFCP* Retail Shop Supplier Delivery Supplier Delivery *Urban Freight Consolidation Platform

8. Airport Hauliers Cargo terminal Ports Carriers Shopping Centers End Customers Warehouses Individual Retailers Outlets Offices An « E-Platform » providing high added value services Transportation & Logistics Suppliers Intelligent Freight System Businesses Urban Logistics Regulator Freight Consolidation Management Logistics Market-Place (B2B) Urban transports Urban initiatives Responsibility for organizing / monitoring the “last-mile” Supply Chain (Smart “Logistic” Grid) at the city level Real-time visibility on demand and capacity, yield management Management of integrated services including storage, picking, packing, final transportation & deliveries for specific market / product segments

9. Agenda • Concept • Benefits • Challenges • LUMD Project • Conclusion

10. Key Benefits Economical Benefits PROVIDERS BUSINESSES Environmental Benefits Benefits to Retailers PEOPLE

11. Benefits to Retailers • Reduced on-site stockroom requirement • Increased sales • Reduced stock-out situations during peak periods • Delivery timing & flexibility • Multiple deliveries a day with appropriate « green » vehicles • Greater range of items • Efficient logistics processes • Unpacking, sorting, labelling, invoicing,… • Returns (unsorting, repacking,…) SALES (70%) STORAGE (30 %) SALES (90%) (10 %) Floorspace

12. Environmental Benefits • Reduced overall vehicle mileage • Fewer goods vehicle delivery movements all the way to city centers • Reduced emissions • Fewer vehicle mileage • « Green » vehicles / alternative transportation modes • Reduced congestion, noise,… • Improved safety

13. Economical Benefits through Consolidation Manufacturer 2 90% of trips are individual cars, for 25kg shopping basket, on an average distance of 10km roundtrip Outside Shopping Center Manufacturer 1 Home Downtown Retail Stores Deliveries in rounds, 3T per salespoint, average distance of 75km Distribution platform Complete trucks (20T), average distance of 350 km Cost of transport in the upstream retail: 5% of the value of the goods (e.g. 4 € for an average basket of 80 €) Cost of the “last mile” in retail: up to 30% of the value of the goods (€ 15 ** for an average shopping basket of 80 euros and 25 Kg) Source : www.cyber.uhp-nancy.fr * Source : emarketing.fr : A complete home delivery service costs 20 to 34 euros but is rarely charged more than € 9.15 ** Home delivery service at Carrefour, Ooshop.

14. Agenda • Concept • Benefits • Challenges • LUMD Project • Q & A

15. A number of interesting initatives have emerged, without however adressing the global issue of urban logistics : Monoprix develops freight through rapid transit rail system (« RER ») and fluvial to supply its stores Several cities (Monaco, Bordeaux, La Rochelle, etc.) have a UDC and pre consolidation platforms La Petite Reine and Chronocity offer a service of alternative delivery (bike, manual cart) Industrial distribution warehouses Pre consolidation platforms UDC: Urban Distribution Center Supermarkets Urban initiatives Picking points Peri urban infrastructures Tradesmen Industrials Consignity offers more than 10 baggage lockers places in Paris, functionning as an advanced stocks for tradesmen ULS Urban Logistical Spots Natoora, e-box and Chronopost offer logistic spots in urban area Urban area Peri urban area

16. The key challenges ahead : • Start-Up Costs • Freight consolidation facilities • « Green » transportation • Financial viability • Flow consolidation opportunities • Information Technology • Marketplace, monitoring, yield mngt,… • Standards • Retailers participation • Transportation & logistics providers (carriers,…) participation • Public authority support : • Local / regional / national authority level • Regulations & Finance

17. The “LUMD” project addresses these key challenges : • Start-Up Costs • Freight consolidation facilities • Transportation capacities • Financial viability • Flow consolidation opportunities • Information Technology • Retailers participation • Transportation & logistics providers (carriers,…) participation • Public authority support : • Local / regional / national authority level

18. Agenda • Concept • Benefits • Challenges • LUMD Project • Conclusion

19. An innovative PPP (Public Private Partnership) sponsored by Advancity: Stakeholders Business Technology 77 Research labs Service providers 75 94

20. An ambitious goal, but a progressive approach through prototyping and real-life experimentations :

21. Logistic spaces Freight • Optimize the ratio kgCO2/surface or storaged m3 • Improve storage management by 15% • Lower the ratio kgCO2/tons or transported m3 by approximately 50% • Achieve 25% modal shift from road to other means • Improved by 30% filling trucks • Reduce by 30% mileage Services and quality of life • Reduce disturbances including noise • Improve proximity services through transport (+10% over 5 years) • Rehabilitate proximity shopping Monitoring of urban logistics flows • First census of urban logistics flows • Powered continuously by the urban logistics integrator Expected benefits for Ile de France

22. Agenda • Concept • Benefits • Challenges • LUMD Project • Conclusion

23. The Smart Logistics” Grid” is more than implementing technologies • Vision of how to transform the last-mile logistics • Collaboration between all key partners of the Supply Chain • Suppliers, Customers • Transportation & Logistics Providers (all modes) • All levels of government authorities • Apply innovative business model • Urban freight consolidation center • Dynamic Pricing • Integrated services • Use International standards for interoperability • Address complexity of implementation