Grant agreement no.: 234061
Coordination and support actions (Coordinating)
Activity code:SST.2008.3.1.4.: Urban freight delivery systems
“Business concepts in urban logistics”
Rosário Macário
Lima, Peru workshop 19.10.2010
Outline
Objectives of WP2
 General overview
Methodological approach
 Final output
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WP2 General overview
The main goals of this work package
 Identify, analyze and compare different business models
present in the different case studies (taking also into account
the different organizational and institutional settings behind it),
 Contribute to the definition and establishment of logistic
profiles taking into account the vertices of the triangle that frame
those logistic profiles (agent needs, characteristics of the urban
area and characteristics of the products/type of delivery).
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Approach and description of tasks
Interaction
with
Workshops
Input from WP1:
regional reports
Delimitation of
cope for business
models and
schemes
Definition of
logistic profiles
Identification of dynamic
mechanisms for business
concepts implementation
and transferability
Synthesis of main findings and good
practices identification
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Input to WP4
and WP5
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Scope for business models and schemes (I)
Objective: Scope delimitation for business concepts in terms of
models and schemes applied and/or expected to be applied.
What is a business model?
It is a representation of how a company buys and sells goods and
services and earns money.
Examples of business models :
• Car pooling
• Car sharing
• Home deliveries
• Taxi freight
• Bycicle taxi
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•Micro terminal
• Bus freight
• Tram freight
• Freight postal boxes
• etc
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Framework methodology: Business models canvas
Voluntarily
initiated
cooperative
agreement
between two
or more
companies in
order to create
value for the
customer
Arrangement of
activities and
resources that
are necessary in
order to create
value for the
customer
Ability to
execute a
repeatable
pattern of
actions that is
necessary to
create value
Overall view
of a
company’s
bundle of
products and
services that
are of value
to the
customer
Representation in money of all the
means employed in the business model
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Kind of link a
company
establishes
between itself
and the
customer.
Segment of
customers a
company wants
to offer value
to
Means of
getting in
touch with
the
customer
Describes the way a company makes
money through a variety of revenue flows.
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Example of application: Chronopost Concorde
Paris case study
• Chronopost Concorde is an innovative organisation of parcel deliveries in the 7th
and 8th boroughs of Paris using clean vehicles as well as a Urban Logistics Spaces
(ULS) located in an underground parking lot
• Chronopost developed a new organisation, based on a main approach from a hub
outside the city
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Framework methodology: Business models canvas
• Chronopost
• Municipality of Paris
other stakeholders involved
• Fire brigade and a national body in charge of police enforcement
Role: verifying the conformity to regulation
• Electricity distribution company of France
Role: Provide advice in choosing the electric delivery vehicles and to
contribute to the provision of the electricity supply devices
• Ademe (French Environment and Energy Management Agency)
Role: Provide funding to invest in the electric delivery fleet. It also funded
impact assessment studies.
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Framework methodology: Business models canvas
Express deliveries in the 7th and 8th
boroughs of Paris.
57% of them are deliveries and 43%
are pick-ups
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Framework methodology: Business models canvas
1,90 m
1,90 m
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Framework methodology: Business models canvas
A key element of this policy is to provide some transhipment facilities
within the city walls, the Urban Logistics Spaces (ULS).
A decision was taken to provide some space in underground parking lots
and provided public space at a “logistic cost”, i.e. a cost comparable to
real estate costs for logistics facilities in the Paris region’s suburban
locations.
It has a hub outside of Paris and it uses a fleet of electric vehicles for the
final deliveries.
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Framework methodology: Business models canvas
Concorde ULS gives Chronopost the advantage
of being very close to its clients (city centre).
Relations are diverse
This means:
• no wasted time in congestion before
delivering the first costumers,
• a higher productivity (70 addresses per route
instead of 56 addresses when the route started
from a hub outside of the city limits).
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Framework methodology: Business models canvas
A daily shuttle between the Bercy
Charenton hub and the underground
Concorde facility made with a vehicle
which can access the underground facility,
limited to a height of 1.95 m. Chronopost
has increased the loading capacity by
adding a specific trailer to the van.
Before…
Currently…
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To make the distribution trip, two routes
per day are organized: one being a 3.5 hour
long in the morning and the other a two
hour long in the afternoon (two shifts). A
productivity indicator is that 70 delivery
points (addresses) are served per day per
person.
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Framework methodology: Business models canvas
•B2B and B2C
•High density commercial areas
customer with express
deliveries of parcels up to 30kg
and pick up
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Framework methodology: Business models canvas
Chronopost has invested €500,000 in the logistic facility, including civil work.
The City of Paris decided to rent the underground logistic facility at the regional
average price of logistics facilities (most of them being located in suburban
locations at low rental cost).
This average price is 60€/m²/year.
A reduced price has been applied by the city of Paris during the first years in order
to help Chronopost invest in the facility. The contract has been signed for a total
of 10 years.
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Framework methodology: Business models canvas
The balance between additional costs and savings (compared to the
previous organisation of operations) was null.
Savings made on fuel :41.000 km/year of fuel powered vehicles are
saved by using electric vehicles
The average gain for private car parking space location is
80€/m²/year in Paris. So over a 10 year period, the logistic space
could have brought 389,600€ to the city of Paris, instead of
182,625€.
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Scope for business models and schemes (II)
For the analysis
of the feasibility
of the business
model we will
use a business
oriented
framework
largely inspired
in the Porter
model of
competitive
strengths
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Definition and establishment of logistic profiles (I)
Objectives: Based on the business models identified before, this task is
going to undertake an assessment of the case studies best approaches
and more adequate participation formats, in order to define and
establish the logistic profiles and the best solutions for each type
Agents'
needs
Definition of
logistics
profile
City area
features
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Product
characteri
stics
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Definition and establishment of logistic profiles
(II)
What is a logistic profile?
Homogeneous group with similar logistics needs (Source: Logurb)
Step 1: Define logistic needs by defining:
• city area features,
• product characteristics, and
• agent needs
Step 2: Determine logistic profile according these variables
Area profile: city area features
Product profile: products
characteristics
• commercial density and homogeneity: number of shops
per block, & of diferent shops, etc
• fragility
• logistic acessibility : level of congestion on the streets
serving that area, existence of delivery bays, level of access
between shop and the parking of freight transport
• perishability
• restriction applied: hourly and weekly periods of delivery
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• size
• easiness of handling
• special conditions
Agent needs'/delivery profile
• urgency of deliveries
• frequency of deliveries
• amounts to be delivered
• timeliness of deliveries
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Definition and establishment of logistic profiles
(III)
Step 3: Determine the
best solutions to each
logistic profile defined
Source: Logurb
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Dynamic mechanisms for business concepts
implementation and transferability (I)
Objective: Define dynamic mechanisms for business concepts
implementation and transferability
 Identify the dynamic mechanisms (“engine”) to facilitate the
implementation of measures along the main types of initiatives
 Operations,
 Land use and Infrastructure,
 Environment,
 Regulations, and
 Technology.
Specification of relations between agents to identify needs for
incentives and regulation.
Example: B2B, B2C and R2Ta( regulator to transport agent)
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Dynamic mechanisms for business concepts
implementation and transferability (II)
Agent Based Modelling (ABM) Approach
Agents
Environment
Customers
Service providers
Operators
Producers
Authorities
etc
Transport Market
Interactions
Business Relationships
Business Models Prototypes
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Final output
In the end, the final output should identify:

Which business models and schemes are best targeted to urban
logistics;
 Logistic profiles identified in the selected cases;
 Which dynamic concepts can be applied.
Output
D2 - Business concepts and models for urban logistics
Released by April 2010
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Thank you for your attention!
TURBLOG team at TIS:
Rosário Macário (rosario@tis.pt )
Maria Rodrigues (maria.rodrigues@tis.pt )
Phone: +351 21 350 44 00
Fax: +351 21 350 44 01
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