E-commerce versus physical retail— Sustainability depends on logistics, not channels

Gilles A. Paché^*

• Aix-Marseille Université, Marseille, France

As e-commerce continues to reshape urban consumption patterns, its implications for city logistics and environmental performance have become a central concern for metropolitan policymakers. Empirical evidence from major European cities suggests that the expansion of online retail does not mechanically translate into increased congestion or environmental degradation. In Barcelona, a comprehensive report on European city logistics initiatives highlights the strategic deployment of micro-hubs, parcel collection points, and electric vehicles as effective instruments for mitigating delivery-related externalities in dense urban environments (https://www.lvmt.fr/wp-content/uploads/2024/05/Harrisand-Dablanc-European-initiatives-of-urban-logistics-report-20231.pdf, accessed December 29, 2025). These findings are corroborated by large-scale modeling work examining 1,057 micro-hubs integrating cargo bikes and electric vans, which demonstrates substantial reductions in travel distances through algorithmically optimized routing (Castillo et al., 2024). Similarly, research conducted in Amsterdam shows that the integration of waterways with clean-energy vehicles can significantly reduce road traffic volumes (Pourmohammad-Zia and van Koningsveld, 2024). Taken together, these cases indicate that the environmental footprint of e-commerce extends beyond street-level traffic flows, pointing instead to consolidation, route optimization, and multimodal integration as decisive levers for improving the sustainability of urban distribution systems at the metropolitan scale.Since the early 2020s, literature reviews and comparative modeling studies have consistently shown that e-commerce logistics relies on highly shared, automated, and optimized systems, increasingly supported by advanced scheduling and routing tools (Garola et al., 2022). These configurations enable substantial reductions in distance traveled per unit delivered, particularly in peri-urban and low-density contexts where individual shopping trips to physical stores tend to accumulate rapidly. Under optimized conditions, a single delivery vehicle can substitute for dozens of private consumer trips, while ongoing fleet electrification further reduces carbon intensity per delivery. However, technological efficiency alone is insufficient to ensure favorable environmental outcomes. Product return rates, constraints imposed by urban infrastructure, and the diversity of operational practices play a decisive role in shaping overall performance. Klein and Popp (2023) emphasize that the presence of physical retail networks does not guarantee sustainability. Instead, environmental impacts emerge from the interaction of building energy performance, consumer mobility patterns, logistics consolidation strategies, packaging management, and return organization. When delivery operations are effectively pooled and fleets decarbonized, e-commerce supply chains frequently achieve lower carbon footprints than conventional consumer travel, even though such advantages remain underestimated in public discourse (Toebast-Wensink et al., 2025).Reassessing retail sustainability is therefore increasingly urgent, particularly because public policies often continue to rely on intuitive assumptions rather than on systematic empirical evidence. Dense networks of urban brick-and-mortar stores, commonly perceived as environmentally superior, can generate redundant logistical flows that prove less efficient than consolidated e-commerce supply chains. As a result, sustainability debates must move beyond simplistic oppositions that frame ecommerce as inherently detrimental and physical retail as intrinsically virtuous. Long-term environmental performance is more likely to emerge from hybrid systems capable of combining delivery speed, resource efficiency, and advanced logistical coordination. Innovations such as predictive inventory management, algorithmic orchestration of flows, reusable packaging systems, and integrated return logistics illustrate the growing convergence between physical and digital distribution channels. Realizing these efficiencies, however, requires institutional frameworks able to assess logistics holistically rather than privileging a specific retail format. Over the coming decade, a key challenge will be balancing intensified logistics aimed at reducing travel distances with strategies designed to curb overall consumption, including repairability, secondhand markets, and circular reuse loops. Sustainable retail should therefore be evaluated through systemic optimization, fleet efficiency, and operational consolidation rather than through visible consumer mobility alone.The arguments advanced in this Opinion article should be interpreted as context-dependent rather than universal. A substantial body of academic research demonstrates that retail environmental performance depends critically on urban density, consumer behavior-including purchase frequency, willingness to accept delivery delays, and propensity for returns-and regulatory frameworks governing city logistics (Edwards et al., 2010;van Loon et al., 2015). In densely populated areas, pooling the flow significantly reduces kilometers traveled per purchase, whereas in sparsely populated or highly car-dependent regions such benefits may be attenuated or reversed. Moreover, policy instruments promoting microhubs, regulated access to city centers, and fleet electrification play a decisive role in shaping observed outcomes (Dablanc et al., 2017). The European cases discussed here, characterized by high urban density and proactive public intervention, cannot be generalized to other geographic contexts without caution. This context-dependent approach seeks to identify the logistical mechanisms that structure environmental performance rather than establish a normative hierarchy between distribution channels, thereby grounding sustainability assessments in local urban and institutional conditions. Policymakers and business executives increasingly recognize delivery consolidation as one of the most powerful levers for improving the environmental performance of e-commerce. Empirical research by Castillo and Álvarez (2023) and Reiffer et al. (2023) demonstrates that centralized order processing combined with high-density routing substantially lowers the distance required per package while decreasing the number of vehicles needed to serve urban markets. In contrast, fragmented retailer networks operating parallel supply chains struggle to achieve comparable efficiency levels. The growing deployment of micro-hubs and urban consolidation centers has profoundly reshaped last-mile logistics, with these facilities now embedded in municipal strategies aimed at improving delivery energy performance (de Bok et al., 2024). By enabling lean, predictable, and algorithmically optimizable supply chains, consolidation reveals environmental gains that remain invisible when assessment focuses solely on traffic volumes or parcel counts. Advanced route planning and operational coordination further enhance these effects by maximizing vehicle fill rates and minimizing fragmented delivery tours. Through reduced redundancy and improved utilization of logistical assets, such system-level approaches lower both direct emissions and the indirect environmental costs associated with inefficient urban operations. Overall, these findings indicate that sustainable last-mile delivery hinges on holistic logistics optimization rather than on restricting consumer access or imposing channel-specific limitations.The deployment of low-emission fleets further amplifies the environmental potential of consolidated e-commerce logistics. When electric vehicles are integrated into optimized delivery networks, carbon intensity per package declines markedly, even for relatively small shipment volumes. Operational studies show that electric commercial vehicles performing frequent stops over short urban distances achieve particularly strong emission reductions when embedded in coordinated routing systems (https://clean-trucking.eu/wp-content/uploads/2022/06/Last-mile-delivery-with-RAP-report-A4-fv856.pdf, accessed July 6, 2025). However, these gains are not automatic. Ultra-fast delivery services with low load factors or excessive speed can erode efficiency, transforming technological advantages into additional CO₂ emissions (Yang et al., 2024). Maintaining favorable environmental outcomes therefore requires careful alignment between commercial objectives and sustainability constraints across last-mile operations (Raj et al., 2024). European market data reveal uneven progress: new fully electric van registrations declined from 7.8% in 2023 to 5.9% in 2024 (https://www.eea.europa.eu/en/analysis/indicators/new-registrations-of-electric-vans-in-europe, accessed September 10, 2025), while fully electric light commercial vehicles accounted for only 6% of sales (https://theicct.org/publication/european-market-monitor-cars-vans-2024-feb25/, accessed April 16, 2025). This slow uptake underscores the limits of isolated fleet upgrades and the need for systemic policy interventions.Despite its potential, certain configurations of e-commerce generate environmental impacts that exceed those of physical retail. Ultra-fast delivery models, characterized by extremely short lead times and minimal consolidation, sharply increase emissions per package by multiplying delivery trips and underutilizing vehicles (Buldeo Rai et al., 2019). Fast fashion presents a comparable challenge, with return rates frequently exceeding 40%, thereby amplifying transport, sorting, and reverse logistics operations that negate the benefits of consolidated distribution (Cullinane and Cullinane, 2021). Moreover, some international platforms rely on fragmented and long-distance supply chains with substantial upstream emissions linked to intercontinental transport and dispersed inventory placement (Pålsson et al., 2017). These counterexamples confirm that e-commerce is not inherently environmentally superior. Environmental performance is instead shaped by consolidation intensity, demand predictability, and governance structures. Logistics organization-including fleet deployment, route optimization, and order batching-ultimately determines outcomes. Where these elements are poorly coordinated, efficiency gains can be reversed, producing higher emissions than conventional store-based shopping. Sustainable performance is therefore context-dependent and sector-specific, reinforcing the need to evaluate logistics design rather than distribution channel choice alone. The food retail sector exemplifies how environmental performance is largely contingent on operational parameters rather than on the choice of distribution channels. In major metropolitan areas, e-grocery increasingly relies on urban micro-hubs to facilitate rapid delivery, sometimes within minutes (Paché, 2022). Consolidated routing and algorithmically optimized order preparation substantially reduce transport intensity per basket while improving vehicle utilization. Studies by Siragusa and Tumino (2022) and Montuori et al. (2023) show that the carbon footprint per package delivered is often lower than that associated with individual trips to supermarkets. A single delivery vehicle serving 40 to 60 households can substitute for hundreds of private shopping journeys, although cold-chain requirements, insulated packaging, and frequent order modifications can partially diminish these efficiencies. In rural or low-density areas, clear environmental advantages materialize only when order volumes reach thresholds sufficient for meaningful consolidation. Quantitative evidence supports this distinction: Edwards et al. (2010) and van Loon et al. (2015) estimate that in dense urban settings, pooled deliveries reduce transport per purchase by 60-80% compared with car-based shopping, whereas fragmented or low-utilization deliveries may generate higher emissions per basket than conventional store visits. These findings underscore the importance of logistics configuration, operational coordination, and urban density in shaping sustainable outcomes.The fashion sector, particularly fast fashion, highlights how operational complexity and consumer behavior can offset the environmental benefits of shared logistics. High return rates frequently generate additional trips, sorting operations, and reverse logistics, which diminish carbon savings (Cullinane and Cullinane, 2021). At the same time, brick-and-mortar stores incur significant environmental costs, including energy-intensive floor space, overstocking, frequent restocking, and unsold inventory often redirected to clearance platforms or landfills, sometimes amounting to 20-30% of seasonal stock. Life cycle analyses indicate that consumption patterns, order frequency, and returns management are more decisive than the channel itself. Advanced e-commerce logistics, leveraging AI, IoT, cloud computing, and predictive demand management, improve inventory reliability, optimize picking and delivery routes, and reduce unnecessary trips, energy use, and waste (Kalkha et al., 2023). Blockchain-based traceability enhances transparency and curbs counterfeit returns, while integrated warehousing and reverse logistics enable faster, more efficient processes. Algorithms such as LSTM and Ant Colony Optimization consolidate routes and resources, minimizing carbon footprints. Operational efficiencyincluding smart sizing recommendations, try-at-home models, and consolidated return pointsemerges as the critical determinant of environmental outcomes, reinforcing the need for a systemic perspective on retail sustainability.For technical products, including electronics, household appliances, and computing equipment, centralized logistics systems offer substantial environmental benefits by streamlining inventory flows and reducing redundant transport. High value-to-weight ratios, predictable purchase cycles, and relatively stable product lines enable regional hubs to consolidate stock and minimize restocking trips to multiple stores. Automated warehouses further transform fragmented volumes into coherent, highefficiency flows, allowing a single distribution network to serve entire metropolitan areas. Agent-based models conducted by Reiffer et al. (2023) and Yang et al. (2024) demonstrate that these configurations effectively eliminate intermediate transport routes, as regional hubs replace repetitive store replenishments and optimized vehicle fleets deliver goods across cities. As a result, per-unit carbon footprints decline, particularly for items purchased infrequently, underscoring that sustainability is determined more by overall supply chain efficiency than by last-mile delivery alone. Pooling shipments, optimizing routes, and centralizing inventory collectively drive carbon reductions, often offsetting the emissions associated with longer transport distances. Incorporating such strategies into urban logistics planning highlights the systemic factors shaping retail sustainability, showing that operational design and network coordination, rather than the choice of distribution channel, define environmental outcomes in both dense and dispersed markets. Brands such as Shein and Temu exemplify the environmental challenges posed by globalized fast fashion in countries like France, yet public debate on e-commerce impacts remains overly focused on visible signs-oversized boxes, poorly parked vans, or returned packages. Less visible environmental externalities of brick-and-mortar stores, including structural overstocking, energy-intensive floor space, supply disruptions, and seasonal restocking, are often ignored, along with millions of individual store trips. Wollenburg et al. (2018) argue that channel-centric analyses exaggerate differences between e-commerce and physical retail, obscuring the importance of systemic logistics factors. Evidence shows that pooling, high vehicle occupancy rates, stable flows, and sophisticated operational management drive most carbon footprint outcomes rather than channel type. Optimized logistics can mitigate environmental impacts across both online and offline systems. Recognizing these systemic drivers encourages policies and management strategies that focus on flow optimization, predictive planning, and fleet efficiency. Such a perspective moves the sustainability debate beyond superficial metrics and channel bias, emphasizing that the design and organization of supply chains, rather than the choice between e-commerce or physical stores, determine the ecological performance of retail operations in urban environments.To maximize environmental benefits, retailers-both online and offline-must abandon notions of incompatible models and instead prioritize reducing unnecessary flows and optimizing infrastructure. E-commerce operators, including second-hand platforms like Vinted, achieve meaningful gains through consolidated deliveries, low-emission fleets, and responsible return management. Physical stores can adopt strategies such as consolidated restocking, limiting unsold inventory, inter-brand pooling, and reducing energy-intensive space. Schulze et al. (2021) show that cooperatives generating pooling and logistical support demonstrate that organizational choices strongly influence environmental performance, often more than distribution channel. Authorities also play a critical role: effective coexistence of both systems requires promoting urban micro-hubs, regulating express deliveries, and harmonizing tax and logistical rules across channels to optimize flows within the market economy. These combined strategies demonstrate that environmental gains arise from systemic planning and coordination. The evidence emphasizes that sustainability is conditional on infrastructure, operations, and institutional frameworks, not merely on channel selection, and that Western approaches cannot automatically be generalized to regions with different urban density, regulatory frameworks, or mobility patterns (Gevaers et al., 2014;Cruz-Daraviña and Bocarejo Suescún, 2021).The European case focus highlights a clear limitation of generalizing sustainability findings across different urban contexts. In cities with lower population density, limited regulatory oversight, or high dependence on private cars, the environmental performance of retail logistics may differ substantially or even reverse. For example, Cruz-Daraviña and Bocarejo Suescún (2021) examine downtown Cali, Colombia, where freight parking is scarce and concentrated on loading docks or on-street bays, generating congestion, extended wait times, and informal practices such as sidewalk occupation.Institutional gaps and weak logistics regulation further exacerbate operational inefficiencies, resulting in higher emissions and reduced delivery performance. Their study indicates that coordinated measures, including combined delivery cycles, mini-hubs, and improved collaboration with private stakeholders, could enhance operational flow and reduce environmental impacts. This case underscores that sustainable retail depends critically on infrastructure quality, local logistical practices, and governance frameworks. Policies and strategies effective in European metropolitan areas cannot be assumed to work elsewhere. Achieving meaningful sustainability outcomes therefore requires solutions that are adaptive to city morphology, transport culture, and regulatory conditions, emphasizing systemic design and context-sensitive interventions over simplistic online-versus-offline comparisons. This Opinion article emphasizes that retail sustainability cannot be assessed through a simplistic opposition between e-commerce and brick-and-mortar stores. The analysis demonstrates that environmental performance is primarily determined by logistics system design, including flow pooling, consolidation rates, demand stability, fleet electrification, and returns management. For managers, these findings highlight the need to prioritize consolidated delivery models, limit promises of ultra-fast delivery incompatible with environmental efficiency and invest in tools to effectively manage returns. For policymakers, the challenge is not restricting e-commerce but regulating its most carbon-intensive forms while promoting shared infrastructure such as urban micro-hubs and low-emission fleets. Longterm sustainability will rely on hybrid systems integrating smart logistics, streamlined flows, and consumption reduction strategies, placing supply chain architecture at the core of the environmental transition. Evidence from Europe illustrates the potential gains achievable under high-density, wellregulated contexts, but transferability requires careful adaptation to local urban density, mobility culture, and institutional capacity. Ultimately, smart logistics, systemic planning, and organizational coordination-rather than the choice of distribution channel-are the decisive factors shaping the ecological performance of retail across diverse contexts.