EVECIA by ITinSell – Embracing sustainability to increase profit & save cost
What is EVECIA?
E-commerce is booming having experienced exponential growth for several years. The global e-commerce market is expected to reach 4.8 trillion euros in 2021 after impressive annual growth rates exceeding 20% between 2014 and 2020.
With the explosion of online sales, reduction of packaging waste and the establishment of a ‘circular economy’ represent major opportunities for ecological improvement and economic growth.
From an environmental perspective, oversized packaging (45% too large on average) drives an overconsumption of cardboard, plastic & paper and the creation of empty space, requiring even more packaging material to reduce the risk of breakage. These materials are rarely reused and immediately become waste. Empty package space eats up overall delivery capacity within vehicles used during shipment. According to a study by DS Smith, emissions linked to the maritime transportation of empty packaging space within containers is equivalent to nearly 122 million tonnes of CO2 per year worldwide.
Overconsumption of packaging materials causes avoidable additional cost for all within the e-commerce value chain and especially for e-merchants who originally buy the packaging. Transportation of this ‘empty space’ incurs a significant additional cost for e-merchants who fund shipment. Losses amount to $146 Bn globally (DS Smith study). To add insult to injury empty space within packages increases the risk of breakage causing further losses.
Delivery prices which were historically driven by weight are increasingly calculated volumetrically, strengthening the case against over-packaging.
There are further avoidable complexities, many of which also erode consumer experience and loyalty. In addition to increased risk of breakage during transit, consumers are often annoyed at large and unwieldy packages, especially those concerned with environmental issues and limiting waste. Relay points and increased storage requirement associated with un-necessarily large parcels can also create delivery timing and customer collection issues as packages are re-assigned to more distant over-spill relay points. All potentially easy wins to boost customer positive experience, ratings & loyalty.
To address this host of logistical issues, there are two smart choices :
• Adapted production – “just in time” creation of packaging by robots at the site of order preparation.
• Software agility – algorithmic selection by “just in time” AI, of the optimum packaging format from a pre-determined list. Amazon’s “matrix” reduces waste and the average empty rate in its packaging for example.
Robotic infrastructure demands a huge capital investment and has the disadvantage of not being readily adaptable and scalable to participate in the ‘circular economy’ for recycled packaging.
ITinSell as a specialist TMS is ideally placed to help and focuses on eco-responsible logistics. EVECIA leverages an algorithmic approach using AI visibility to offer the optimum container-content packaging solution, whilst also maximising the potential for reusing & recycling packaging.
ITinSell places packaging at the heart of delivery logistics recognising the economic, time & sustainability benefits that can be achieved by embracing the potential to recycle packaging and optimise individual package size.
Key features of ITinSell EVECIA are:
• Forecasting and management of packaging stocks based upon current orders and order history
• Calculation of the appropriate package for each order according to pre-defined criteria (e.g. dimensions, weight, fragility)
• Management of packaging as a product in order to facilitate supply, storage and collection
• Automated assistance to select optimal package size
• Visibility and tagging of reusable packaging to recycle stocks and save cost
The EVECIA project is sponsored by ADEME (French Environment and Energy Management Agency) as part of the ‘Investments for the Future’ plan established to promote environmentally friendly e-commerce innovation.