Reducing the cost of B2B logistics via night deliveries: Does it really work?

Abstract

Night delivery is an approach increasingly used by motor carriers to improve the efficiency of business-to-business logistics. Many benefits of night deliveries have been reported in the literature, but in practice, not every carrier is benefitting from night deliveries. In fact, anecdotal evidence suggests that many carriers are losing money from night deliveries. While a limited number of past studies have discussed the disadvantages of night deliveries, in many cases, they cannot explain why carriers are not benefitting from night deliveries. This implies that some disadvantages of night deliveries may still be currently unknown. This paper seeks to identify such “hidden” disadvantages by studying this issue through the lens of transportation economics. Understanding such disadvantages can contribute to both theories and practice of night deliveries, especially for decision making on night-delivery adoption by carriers, as it can lead to a better understanding of when and where night deliveries might be beneficial or detrimental.