An efficient urban logistics: a challenge for Latin American cities
February 09 , 2018

​A project developed by MIT, Universidad del Pacífico, Universidad San Francisco de  Quito and by the non-profit organization Logyca/Investigación, sheds light on the logistic reality in three large Latin American cities. The research also provides a series of recommendations to improve the development of logistics activities in the cities.

​The correct functioning of cities has a strong impact on their residents. The more orderly, clean and efficient they are, the greater the benefit their citizens will obtain. In that sense, one of the key concepts for the development of this virtuous circle is urban logistics. 

This is a concept that brings together all the logistics operations that take place in a city, such as the loading and unloading of goods, transportation, and distribution, among others. In Latin America, particularly, cities -especially capital cities- have grown dramatically in recent years. And the future could be even more complex. "Cities are becoming larger, more complicated. Only in Peru, one-third of the population lives in Lima. And if you add to that the new dynamics generated by e-commerce, which involve greater cargo movement, we will see that the number of vehicles on the streets will increase and thus, congestion", says Daniel Merchan, researcher at the Center for Transportation and Logistics of the Massachusetts Institute of Technology (MIT). 

To know a little more about the reality in the region, precisely, the MIT, hand in hand with Universidad del Pacífico, Universidad San Francisco de Quito and Logyca/Investigación, a non-profit organization specialized in generating knowledge about value networks, developed a project to analyze urban logistics in the capitals of Peru, Colombia and Ecuador. The project in each city had three phases: characterization (determining the characteristics of the cities), identification of the critical areas for logistics and exchange of ideas with actors of the private logistics sector and representatives of public entities. 

According to Carlos Suarez, professor of Universidad San Francisco, Quito has made progress since ordinance 147, which, among other measures, regulates the transportation of cargo and determines that the vehicles for this purpose are to park in special bays in the historic center of the city. However, according to the professor's diagnosis, the ordinance has many opportunities for improvement. "The number of bays that exist today is much lower than what we consider necessary for that part of the city," says Suarez. 

In the case of Bogotá, it was determined that one of the main complexities of the city is that its soils have a mixed use. That is, commercial and industrial areas are scattered throughout the city and are not as concentrated as in Lima or Quito. "This situation may be useful for citizens, because if they go out they may find all the services they need quickly. But for logistics it's a nightmare, since you have to distribute all kinds of products throughout the city", says José Hincapié, researcher at Logyca. According to the analysis made on the loading and unloading in some Zonal Planning Units -small urban subdivisions- located in the center of the Colombian capital, Logyca estimated that, on average, only slightly more than one third of the capacity of cargo trucks is used. Hincapié stressed that one of the alternatives to this situation is that companies choose to carry out the distribution of their products jointly. Another finding was that many points of sale do not have the necessary capacity to process the delivery efficiently, which generates delays for the vehicles. 

What happens in Lima?

Michelle Rodríguez, dean of the School of Engineering at Universidad del Pacífico, highlighted that in the case of Lima it was very difficult to obtain information about the legislation regarding cargo transportation, since either the data was not at hand or there was no homogeneity in the information provided by the authorities of the districts analyzed (Miraflores, Cercado de Lima, Jesús María, La Molina Lince and San Isidro). Another problem found in the Peruvian city, especially in the center, was the  lack of warehouses and the little preparation on inventory management. "Not only is merchandise distributed in very cramped areas, but the delivery is also done with a high daily frequency due to the lack of storage spaces and refrigeration for perishables," said the professor. In Lima, says Rodriguez, critical square kilometers for urban logistics located in the districts of Miraflores, San Isidro and in the historic center of the city have been identified. "Downtown -close to the central market- we have collected data on a square kilometer that has around 20,000 distribution points. There are streets that are literally closed because there is a lot of merchandise movement", reveals Rodriguez. In San Isidro, where the financial center of the capital is located, the research also indicates that there is no good signage or spaces for loading and unloading. 

Public policy recommendations

Based on what has been found in the three South American cities, the MIT and the other organizations involved in the project have drawn up recommendations on public policy and logistical practices. The first group of proposals includes a reduction in traffic interruption derived from loading operations. The axis of this first idea is the implementation and regulation of loading and unloading bays in cities. But, according to Daniel Merchan, from MIT, their location and quantity will depend on the density and intensity of operations. 

The second recommendation is to move delivery operations out of peak hours, which can be done -according to the researchers- through access restrictions by hours, incentives to make deliveries in a low traffic schedule or to adjust deliveries exclusively to the hours where there is a greater amount of logistics operations. 

The third suggestion is to promote the use of environmentally friendly vehicles. In that sense, the MIT points out that operational incentives could be generated to use these units (such as access to restricted areas) or, on the contrary, to establish restrictions on access to certain areas of the city by quantity of emissions. The last two proposals are to facilitate the multimodality of urban distribution (for example, that transshipment spaces from heavy vehicles to light and ultralight vehicles are implemented) and to promote the dissemination and transparency of information (better information portals to access the regulation and ordinances on logistics operations). 

As regards logistics practices, the suggestions are varied. One is to improve the use of the assets of organizations, such as the application of collaborative logistics, so that two entities make a joint delivery to the same point of sale. Another is to increase proximity to customers, which can be achieved, among other measures, through the diversification of the vehicle fleet based on coverage, restrictions and density of delivery areas. The researchers also recommend operating eco-efficient vehicles (electric vehicles or bicycles). Finally, the project entities suggest developing alternative delivery methods, such as the implementation of points in neighborhood stores or pharmacies or mobile warehouses (large trucks that are temporarily located in areas to meet customers). 

​A list of recommendations that, according to specialists, should try to adapt to the needs and resources of each city. The collaboration of the authorities and companies to implement them will undoubtedly be indispensable. 

EU2A6624.jpgDaniel Merchán, Andrés Regal, José Hincapie, Michelle Rodríguez, Mario Chong, Carlos Suárez, Esteban Mascarino

Ingeniería UP transporte Innovación MIT


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