Green Logistics in E-Commerce Industry: A Case Study on Daraz Nepal Pvt. Ltd.

Abstract

This study explores the important role of last-mile delivery in the logistics sector, with a particular focus on the e-commerce sector. The last mile, often considered the most important customer touchpoint, requires optimal vehicle allocation and route planning. Daraz Nepal Pvt. Ltd., a leader in e-commerce, currently relies on two- and four-wheeled gasoline-powered vehicles for last-mile deliveries, using a hub-based model spread across nine locations across the Kathmandu valley. In line with its commitment to environmental sustainability, Daraz aims to convert its entire fleet of gasoline-powered vehicles to electric alternatives, thereby contributing to the global effort to reduce the carbon emissions. Our research yields compelling findings that highlight the significant benefits of transitioning from ICEs to electric vehicles in the context of e-commerce last-mile delivery. This conversion promises significant fuel savings, significantly improved fuel efficiency and an extremely short payback period of less than 5 years. We recommend that organizations involved in last-mile delivery, especially in e-commerce, carefully consider the use of electric vehicles as a financially prudent and environmentally friendly option. Additionally, our research highlights the importance of data-driven insights, using advanced data visualization tools, including sophisticated cash flow diagrams and infographics created by Python created, to improve decision makers' understanding of financial drivers and highlight the value of data-driven decisions which helps in promoting resilience and sustainability in the logistics and transport sector. In addition to these findings, our research also examines the transformative potential of energy consumption and emissions reduction in last-mile logistics. We reveal a stark disparity between petrol and electric vehicles, with petrol two- and four-wheelers showing significant energy consumption and emissions. However, our research offers the possibility of significantly reducing emissions. Additionally, our economic analysis demonstrates that investing in emissions reduction, which represents a cost of $357.15 for two-wheeled vehicles and $171.48 for four-wheeled vehicles.