“The different vehicles that operate on the kerbside have different needs and are nuanced – from servicing vehicles to delivery vans – and they all have different safety issues and regulations.”

Founder, tech company

Like all cities, London has a huge range of freight and delivery needs. Vehicles might start and finish their journey in the city, leave London for elsewhere, or vice versa. Different types of goods and services have different requirements. Parcels need to be delivered quickly, and some products need refrigeration, while construction waste can travel at slower speeds. Some deliveries are bulky, and others can be easily carried on a bike.

In this chapter, we set out the key reasons that freight and delivery journeys are made in London. We focus on five sectors that together make up the bulk of freight vehicle movements: parcel deliveries, food supply chains, construction supply chains, servicing, and waste and reuse. There are of course other reasons for freight vehicles to be on the road, as well as some overlap between these categories – for example, waste from one building site can become part of the construction supply chain for another. But a survey of these five key sectors will show us how journeys are changing now, how they are likely to change in future, and the different ways that we can reduce their impact on the city and the planet.

Parcel delivery

The parcel delivery sector – goods delivered direct to consumers, usually at small scale – has been increasing in London for some time as a result of the shift to online shopping. ³¹ There has also been a corresponding decline in bricks-and-mortar retail, and both trends have been accelerated by the coronavirus lockdowns. The end of pandemic restrictions might abate this change somewhat, but it does not seem likely to reverse it. ³² In addition, a minority of goods received in delivery parcels are returned to the retailer, increasing volumes further.

Parcel delivery to people’s homes across the UK was once the preserve of the Royal Mail and its sister company Parcelforce. However, changing competition rules and the sector’s expansion mean there are now multiple, competing parcel delivery firms on our roads. Some retailers also have their own delivery fleet. These are often large stores supplying bulky goods like electrical items and furniture, or smaller local firms like florists who make delivery rounds in a small area. As a result, it is common to see delivery vans from several companies arrive at the same address in a short space of time and compete for the kerbside.

Most parcel deliveries (except those handled by the retailer themselves) are picked up from the retailer and taken to a distribution centre. If they are travelling a long way, they may be delivered to another, more local distribution centre, before being unpacked into smaller vehicles and taken to people’s homes. A small amount of mail travels by train, usually from London to Scotland, but the vast majority of deliveries are made by road. Bicycle and motorcycle couriers have been part of inner London’s logistics infrastructure for many years: these were often used to transport time-sensitive documents between offices, as they could move faster in traffic than a car. Document deliveries are now less common, but bike deliveries are becoming more common – partly driven by increased interest in low-carbon and low-pollution choices, and partly by the development of cargo e-bikes, which make it easier to carry heavy loads over longer distances.

Parcel delivery firms face significant challenges operating in London. Road charging schemes operate in the city for different types of vehicles, including the expanded ULEZ increase costs. Congestion levels are often 22 high, and this makes it harder to time deliveries accurately, which can be frustrating for consumers. In some places, changes to encourage cycling and walking have increased congestion and slowed journey times for larger vehicles. However, these changes may encourage modal shifts as operators find alternative ways to ensure reliable and efficient deliveries. In 2020, DHL launched its first riverboat parcel delivery service, which brings shipments to Bankside Pier for onward “last mile” delivery by cargo bikes.

Retailers and parcel carriers compete on speed, price, delivery options, and product range. To do so, they need to store products either within the city, or at its fringe. One interviewee described this as parcel companies “trying to get as close as possible to people’s chimneys”. ³³ A shortage of industrial land for repacking loads closer to their final destinations makes it harder for companies to manage logistics, and also increases traffic as more vehicles drive longer distances, as illustrated in Figure 1).

There is controversy as to whether the explosion in parcel deliveries should be curbed. Some argue that home deliveries replace journeys that consumers would have made to the shops, some by private vehicle. ³⁴ This is true, though the replacement rate is unclear, and inevitably deliveries will also replace journeys that consumers would have made by public transport or active travel. Recent research in the US context suggests that e-commerce currently emits less carbon than traditional retail if customers would otherwise drive to the shop. Traditional retail tends to be more carbon efficient if customers make trips by public transport or active travel, or buy from several shops during one trip. ³⁵ Though less relevant during the pandemic, personal deliveries to offices increase the number of delivery vehicles driving into central London, rather than to surrounding residential areas.

Concern about ill health caused by air pollution is growing, and if London is to meet the Mayor’s goal of net zero emissions by 2030 it needs to rapidly decarbonise its transport system. Demand for home deliveries is expected to continue increasing over the next few years, so there is a pressing need for change in how London’s parcels are delivered. ³² This is likely to entail more use of bikes and e-bikes, last-mile delivery hubs to reduce congestion, and parcel lockers for consumer collection. These solutions are discussed in more detail below.

Food and its supply chains

Before 2020, the movement of food around London received comparatively little attention, but since then the impacts of Brexit and the pandemic have generated far more interest in the topic. The most disastrous predictions – of total disruption to the supply chain – have not fully materialised, but there have been sporadic shortages on supermarket shelves and insufficient delivery slots to meet demand at times. These are due to a complex combination of factors: bulk buying in the early days of the pandemic, reduced production due to social distancing within facilities, increased demand for online delivery slots, labour shortages due to staff illness (or self-isolation), and disruptions to travel at the Channel Ports as new COVID-19 testing and post-Brexit trade rules have come into play.

London imports almost all its food from other parts of the UK and overseas. Earlier in its journey, food may travel by HGV, ship, or occasionally by air. Most food is then moved into the city by HGV, with the bulk going to supermarkets. Larger stores may receive multiple lorry deliveries per day, mostly overnight when the store is closed. Some of these lorries will be transporting frozen or refrigerated goods, which means unexpected journey delays can have a significant impact. Congestion is less of an issue for these HGVs as their drivers tend to travel at night, but congestion in and out of London earlier in their journeys can be a problem. Such issues could increase the air pollution and carbon emissions caused by HGVs.

Supermarkets were among the earliest businesses to move to e-commerce – gradually over the last decade or so, and then very suddenly during the pandemic. There are reports that demand for online food deliveries is now falling – perhaps due to people returning to supermarkets and other food shops, and perhaps because the proportion of food that people eat in the home is now falling as we return to restaurants and takeaways. It seems likely, however, that demand for online deliveries will remain higher than before the pandemic. Historically, many online orders were collected by delivery staff from standard retail shops, but in the last few years supermarkets have begun to experiment with “dark stores” which are used only for delivery orders. These are cheaper to run than ordinary stores as they do not need customer facilities, promotional displays, or a convenient location for customer visits. They can also be optimised for very fast collection of goods by skilled staff. However, industrial land shortages in London can make it harder to set them up near residential areas.

In the last year, London has experienced rapid growth in short-notice, small-scale grocery delivery services. These deliver a limited range of goods by bike or motorbike, usually in less than an hour – putting them somewhere between standard supermarket deliveries and takeaway services. ³³ Most are independent companies, but some supermarkets have launched similar services for their own goods, and it is sometimes possible to order groceries through the established takeaway apps. This is a rapidly growing sector, but it is hard to say what the future trajectory of this segment of the market will be, particularly as lifestyle and working patterns are disrupted during the recovery from the pandemic. It is also difficult to say what the congestion and pollution impact of the new ultrafast delivery services will be. This will depend on what type of vehicle they use, whether they replace a trip to the shops that would otherwise be made by car, and whether deliveries are made by larger vehicles that create congestion as they park to unload deliveries. For these reasons, as well as road safety and local air quality concerns, some London communities have set up vocal opposition movements against the opening of food delivery consolidation centres near them.

Overall, it is likely that supermarket home deliveries take traffic off the road. Each LGV can hold multiple orders, and in many cases each order replaces a car trip to the supermarket. For some London 24 households, the ability to have groceries delivered routinely makes it possible to live in the city without a private car. However, the need for groceries to be delivered to households in specific time slots means that delivery vehicles’ journeys are not always on the shortest possible route – and some shops are beginning to offer cheaper slots with a wider delivery window so that they can better optimise routes.

Servicing

London has a huge variety of service sector industries which use road transport. These range from mobile hairdressers and plumbers to Internet installers and district nurses, serving both domestic and commercial premises. It is hard to form generalisations about such a large sector, but it seems clear that servicing activities in London have been growing for some decades.

There is considerable crossover between this group and the construction sector described above: many small traders will take on both building and maintenance work, and so challenges overlap between the two groups. Many service sector providers and construction providers are affected by the Congestion Charge and ULEZ. For small companies or sole traders, the costs of upgrading to ULEZ-compliant vehicles can be prohibitive. There are recent reports that the second-hand value of conventional LGVs, many of which incur the additional ULEZ charge, has plummeted in London. Congestion can also cause significant problems for service sector trips, especially for health and care services: a traffic jam can easily mean a client is waiting in real discomfort to be helped to have a meal or take a shower. Moreover, difficulty in making visits makes adult social care services, already under significant strain, likely to be cut still further. Unlike construction, waste, parcel delivery and food supply chain vehicles – which generally either use designated parking sites or stop only briefly – service sector vehicles often need to park in residential or commercial areas for long periods. If they can’t find a parking space, workers might need to walk while carrying heavy equipment. This is a particular problem in London, as fewer homes, shops and offices have designated off-street parking and there are more parking controls than in other parts of the country. Some small traders report that they do not take on work in areas where parking is likely to be difficult, as it makes jobs too costly and time consuming.

Waste and reuse

London produces a lot of waste – about half a tonne per household per year, plus more from commercial premises, in addition to the construction waste mentioned above. Much of this can be re-used, composted or recycled, which in most cases requires some type of industrial processing. Residual waste that cannot be recycled is either incinerated (within London and elsewhere) or taken to landfill. To reduce carbon emissions and pollution from waste management, the Mayor has committed the city to become “net self-sufficient” for waste by 2026, requiring all waste to be managed within London. Since there are no active landfill sites within London, this means that there will be a greater role for incineration, re-use and recycling. While the proportion of waste being recycled has increased in recent years, and is expected to grow further, population growth may mean the total volume of waste will not be reduced by much.

At present, most of London’s residential and office waste is collected from the kerbside, with recyclable materials taken to large sorting centres and non-recyclable waste taken either to incinerators or to a mechanical and biological treatment plant at Frog Island. After being sorted and processed, recycled material is sold on for industrial use on a commercial basis – paper to paper manufacturers, glass to bottle makers, and so on. More specialised commercial waste is sometimes taken directly to processors for recycling, and some waste is taken directly to council tips by consumers. Freight movements around incinerators and sorting centres are often very unpopular with residents due to the noise, the smell, and inevitable incidents where waste is dropped or blown out of vehicles by the wind.

Kerbside waste and recycling collections are made by specialist trucks run by companies under contract to local authorities. Most of these trucks have petrol or diesel engines, but some local authorities now have electric vehicles, and others will require it of their suppliers in future. Collections are mostly taken by these trucks to sorting centres (largely located on industrial sites in outer London) or residual waste processing (incinerators or mechanical and biological treatment). However, waste going to the Belvedere incinerator in southeast London travels by boat from the city centre, using the Thames tides to reduce the power needed for the boats. ³⁸ In parts of London where most waste is generated by business activity (central London or industrial areas), there are many different waste removal companies each operating their own vehicles, leading to unnecessary journeys. This is where coordinated procurement could help. In central London, the Crown Estate has been asking business tenants to pick from a smaller number of selected waste removal companies that already operate in the vicinity, in order to reduce the number of vehicles travelling in and through the area.

Local authorities are responsible for their own residential waste, and take any profit that is made from selling recyclable materials. As a result, the goods which are taken for recycling and the frequency of collections varies from borough to borough. In London, local authorities are grouped into five waste authorities, who coordinate procurement for the processing of waste.42 There is currently no centralised system for managing commercial or construction waste. Some is collected by local authorities, and some by commercial operators acting independently. It is relatively easy for local authorities to create an efficient collection route within their borough, but beyond borough boundaries it is harder for different parties to coordinate so as to reduce the total distance travelled by freight carrying waste and recycling. There is a similar issue after recycling has been processed: because it is sold on a commercial basis without central organisation, manufacturers may not be buying it from the closest provider, and loads are often sent out in small vans rather than being consolidated for multiple similar purchasers.

The complexity of this system means that while there is scope to reduce pollution and congestion from waste and recycling freight, it is not easy to achieve. The situation is complicated further by residents’ opposition to waste treatment plants being located in their area: if a plan is turned down, it will often mean that waste has to travel further. However, there may well be scope for more river and rail journeys, more use of electric vehicles, and reductions in total vehicle mileage.