One of the harder-to-abate sectors, freight, accounts for 9% of global CO2 emissions, more than three times that of air travel. Moreover, it is a highly fragmented sector, with more than 91% of operators having a fleet size of 6 vehicles or less. So when Freightzy, a modern, innovative logistics company, and a Cloverly customer, shared that they grew 5x in 2021 due to their carbon neutral shipping program, we were intrigued. We got to chatting with Sean Freedman, the president of Freightzy, on how the company achieved this incredible growth and what other firms in the logistics space can do to become sustainable and profitable.
Carbon neutral shipping with Cloverly
Believing that he had the right formula to exceed customer expectations, he was looking for a differentiating factor that would give Freightzy an edge over competition in the third-party logistics or 3PL sector. What started as an email to the Cloverly team quickly shaped into a completely new product offering for clients, Freightzy’s Carbon Neutral program for shippers. Sean Freedman shared that talking to Cloverly helped him see how commercial shipping can benefit from a sustainability solution like Cloverly. There was a shared commitment to building something extraordinary.
Using the Cloverly API to bring the carbon-neutral product to market quickly, Freightzy first calculates carbon emissions based on weight, mileage, distance, etc. Then, it uses Cloverly to offset the carbon emissions of its 3PL partners. As a result, Freightzy now has a premium offering that caters to the growing segment of environmentally conscious customers.
The results
Since its launch in March 2021, Freightzy has seen its top line grow five-fold, attributed primarily to its carbon neutral product offering. It is also seeing greater customer engagement which is encouraging in a commoditized industry like freight. For any logistics firm, the typical priorities for sustainability tend to be optimizing miles, reducing empty miles, and then offsetting unavoidable emissions. Though initial customer reaction for offsets was mixed, Sean Freedman quipped that it was the right time for the industry to adopt sustainability. The results clearly show his intuition was correct. His advice for other companies is to create new ‘green’ solutions and exceed customer expectations. The trend is only accelerating, and customers will look to their vendors to be leaders in this area.
“As one of the largest carbon-emitting industries, offsets are the best option right now. Given the fragmented nature of the industry, the role of intermediaries like Freightzy in the sustainability transition is significant. Providing carbon-neutral shipping is one of the ways for logistics intermediaries to be part of the solution.”
-Sean Freedman, President, Freightzy
Sustainability leading to profitability
The success of Freightzy is proof that incorporating sustainability is also a ticket to profitability and loyalty. While hydrogen and battery-powered vehicles are the dominant long-term solutions to decarbonize the shipping and logistics industry, customer demand for carbon-neutral shipping is fueling the sustainability transition of this sector. Cloverly’s API-first approach to sustainability-as-a-service is the foundation for accelerating the shift to carbon-neutral shipping in the logistics industry.
If you'd like to make your shipping or logistics solution carbon-neutral, contact us today. You can also visit our buyers page to learn more about our API and other solutions to offer sustainability-as-a-service to your customers.
