Sustainability and Night Delivery1
Eric Paulsen is a manager of Cyclone Ice Cream LTD., a manufacturer of several ice cream products, based in a suburban city near Chicago, IL. One of the largest customers for Eric is ABC Mart, which is a grocery chain store with about 30 stores in the Chicago metropolitan area and its surrounding regions. Cyclone delivers its ice cream products to ABC Mart every day by using several delivery trucks that Cyclone owns. These trucks normally make deliveries in the morning and early afternoon to ABC Mart stores
One day, Eric was talking to Frank Smith, the VP of purchasing at ABC Mart. During that meeting Frank mentioned to Eric that ABC Mart is initiating a sustainability project, and would like Eric to participate in this project. Frank told Eric that the objective of this project is to reduce the amount of carbon emissions resulting from the activities performed by ABC Mart. Frank asked Eric to come up with a strategy to reduce the amount of carbon emissions that results from Cyclone’s delivery operations to ABC Mart. Frank wants to see an idea and the estimates of carbon or fuel reduction that may be expected from the use of Eric’s strategy. Eric was thinking about this project on the way back to his office, and remembered that he recently read an article about off-peak deliveries and fuel savings resulting from this strategy. As he recalled this article, he remembered that there are both advantages and disadvantages associated with off-peak, or more specifically nighttime, deliveries.
The main advantages include the following: First, lower truck emissions are expected due to favorable nighttime traffic conditions (higher speed and reduced idling time). Second, it can avoid making deliveries to stores during the peak sale times, which will reduce disturbances for shop owners. Third, it can improve vehicle utilization rates and thus reduce the fleet size needed to meet customer demands. This is because Cyclone makes deliveries to other retailers during daytime, so that trucks can be used during both daytime and nighttime. Fourth, it can reduce the parking fines for Cyclone. Because many ABC Mart stores are located in Chicago metropolitan areas, Cyclone trucks often have to park illegally on streets during deliveries, which results in parking fines. During nighttime, however, roadside parking is legal in many store locations. Fifth, research has shown that the enhanced nighttime stability of the atmospheric layer could trap more pollutant particles than during the day, so that nighttime driving results in reduced carbon emissions relative to the same-distance daytime driving.
The main disadvantages include the following: First, it requires the stores to have trained staff who can accept deliveries during the nighttime, which may cost the stores (for increased shifts and training). Similarly, the stores may have to incur higher heating and lighting costs due to additional operating hours. Eric is concerned that this additional store cost will eventually be passed on to Cyclone. Second, it results in increased noise during nighttime. In many city areas, there are “quiet times” during nighttime, which forbids certain loading and unloading operations that generate large noise. This may require Cyclone to purchase quieter vehicles and equipment. Third, it can cause driver fatigue. With night deliveries, some drivers are asked to drive both daytime and nighttime, which can result in higher driver fatigue and possibly higher accident rates. Fourth, it may result in higher risk for theft during delivery. It is known that theft can happen with higher probability during nighttime than during daytime, so that delivery trucks may face higher risks of theft with night deliveries. This may require Cyclone to provide extra securities for their vehicles and drivers.
CASE QUESTIONS
1. Create a list of benefits for adopting night deliveries, including (but not limited to) those that are mentioned above.
2. Create a list of disadvantages associated with night deliveries, including (but not limited to) these that are mentioned above.
3. After considering both advantages and disadvantages, do you recommend that Cyclone adopt nighttime delivery? Why or why not? Should your recommendation be based only on costs?