Common MicroHub Research Project: Research Scan

This research scan revealed a lack of an established and widely accepted definition for the concept of consolidation centers or microhubs. Many recent implementations of urban freight consolidation have focused on bundling goods close to the delivery point by creating logistical platforms in the heart of urban areas. These have shared a key purpose: to avoid freight vehicles traveling into urban centers with partial loads.

To establish definitions of micro-consolidation and its typologies, it is important to review previous efforts in the literature that have explained and evaluated urban consolidation centers and lessons that have led to the search for new alternatives. Starting in 1970s, the urban consolidation center (UCC) concept was implemented in several European cities and urban regions. These were mostly led by commercial enterprises with temporary or even structural support from the government to compensate for additional transshipment costs. Allen et. al. defined the UCC as a “logistic base located in the vicinity of the place of performing services (e.g., city centers, whole cities, or specific locations like shopping malls) where numerous enterprisers deliver goods destined for the serviced area from which consolidated deliveries as well as additional logistic and retailed services are realized”.

Many of these implementations failed to operate in the long term because of low throughput volumes, the inability to operate without financial support from government, and dissatisfaction with service levels. The cost of having an additional transshipment point often prevented the facilities from being cost-effective, and they could not operate when governmental subsidies were removed (4). From a commercial perspective, experiences with publicly operated UCCs were mostly negative, and centers that have operated since 2000 are often run single-handedly by major logistics operators.

Although it appears that many UCCs were not successful, that does not mean that the idea of an additional transshipment point should be sidelined completely (4). Several studies have mentioned the micro-consolidation concept as a transition from the classic UCC. Learning from previous experiences, Janjevic et. al. defined micro-consolidation centers as facilities that are located closer to the delivery area and have a more limited spatial range for delivery than classic UCCs. Similarly, Verlinde et. al., referred to micro-consolidation centers as “alternative” additional transshipment points that downscale the scope of the consolidation initiative further than a UCC.

In this project, a delivery microhub (or simply a microhub) was defined as a special case of UCC with closer proximity to the delivery point and serving a smaller range of service area. A microhub is a logistics facility where goods are bundled inside the urban area boundaries, that serves a limited spatial range, and that allows a mode shift to low-emission vehicles or soft transportation modes (e.g., walking or cargo bikes) for last-mile deliveries.