Urban freight sector in India witnesses the exponential usage of cargo bikes since 2011, for reaching its customers. Cargo bikes are used by eretail firms for mobility in traffic dense roads. This research contributes to the sustainable development of e-commerce and it measures the economic, environmental and social efficiency of cargo bikes in e-retail firms using survey method. It also estimates the optimum volume of cargo bikes on city roads for effective and timely delivery. Data collected by video graphic study is analysed by a traffic simulation tool 'PTV Vissim'. Simulation results are validated with the real data. The findings of this research helpto replace mini trucks with cargo bikes, which in turn minimizes the delivery time, carbon emission, and driver discomfort. The major implications of this research are: e-retail firms have to motivate its customers to prefer prepaid orders and delivering the goods at non-peak time to achieve sustainability. © 2020, Faculty of Mechanical Engineering, Belgrade.