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Five Initiatives for Supply Chain

Sustainability
What do
SUSTAINABILITY | By Chris Cunnane • 01/30/2019
you want
Sustainability and the concept of to learn?
“going green” has been a hot topic
lately, especially as companies and
countries look at their overall carbon SELECT CATEGOR
footprint and look for ways to be more
environmentally friendly. Of course,
there is a system of checks and
balances for global corporations, as even though they may have the best intentions,
profitability is still the main business driver. Over the last few years, supply chain
sustainability has become increasingly important, as manufacturers and retailers
have taken the lead on green initiatives across the full spectrum of the supply chain, Search this websit

including in the warehouse, store, and through transportation. Here are five ways
these companies are improving supply chain sustainability.

Product Packaging
One area of concern for the long-term health of the world is the use of packaging in
both the manufacturing and shipping of products. Many companies have seen both RELATED
the inefficiencies of their packaging, as well as the wastefulness, and taken this as POSTS
a direct challenge for major improvements. In an article I wrote a few years ago, I
SUSTAINABILITY
noted most retailers use an excessive amount of packaging when they ship items.
The extra boxes, bubble wrap, tissue paper, and additional packaging materials can What the World
have a negative impact on the environment. It is materials that can be used for Cup Can Teach
other shipments, reducing the amount of materials retailers need to keep on hand. Industrial
If the end consumer does not recycle the excess material, it is clogging landfills and
Companies About
contributing to a growing problem. To further complicate things, as trucks are
Energy Transition
packed less efficiently, it takes more routes to deliver all the packages. The
combination of money spent on additional fuel for more routes and the emissions and Sustainability
from these vehicles contributes to overall pollution issues. By Mike Guilfoyle ·
11/29/2022
However, it is not just the packaging of shipped orders that is a problem. Often
times, product packaging is not recyclable or biodegradable, which compounds the
SUSTAINABILITY
problem. Recently, Nestlé announced that it would create the Institute of Packaging
The Benefits of
Sciences to focus on developing “functional, safe, and environmentally friendly”
packaging. The new packaging tests will look at recyclable, biodegradable, and Sustainable Supply
compostable technologies, each of which will be tested across a number of product Chains
lines in the lab. This will be a major step in helping to reduce packaging waste in By Jorge Lopera ·
the global supply chain. 10/25/2022

Energy Efficiency
Warehouse sustainability is a major concern in the global supply chain. However, SUSTAINABILITY
there are many steps that warehouses can take to become more sustainable, Why Sustainable
especially when it comes to energy consumption. In a report my colleague Steve
Home Delivery
Banker recently wrote, survey-based research showed the important role safety
Results in Greater
plays in a thriving warehouse. A key part of this is proper lighting within the
warehouse. Energy-efficient LED lights can serve two roles here. First, they can Sales and
provide better lighting within the warehouse. Second, they can reduce energy Profitability
significantly, with many companies cutting their annual lighting costs by 50 to 60 By Chris Jones ·
percent as a result. Less energy consumption is a win for sustainability. 09/29/2022

Another area of energy efficiency is the use of alternative power sources. More and
SUSTAINABILITY
more companies are turning to solar and wind power to reduce their reliance on
traditional energy sources and generate their own energy. For many warehouses, 5 Best Practices to
the cost for the installation of solar panels can be recouped within the first six Overcome Scope 3
months. For those warehouses that are not suitable for solar panels, wind energy is Emission
an alternative, as well as skylights which can let in natural light and reduce the
Reduction
amount of electric lighting that is needed.
Challenges
By Alex Zhong ·
Alternative Fuels
09/13/2022
Alternative fuels are creating a lot of attention in the transportation sector. Seeing
major truck manufacturers running pilot programs of electric semis is a big deal for
SUSTAINABILITY
the industry. Companies like Daimler, BYD, Volkswagen, Nikola, Tesla, and Uber
are providing the business case for the eletric trucks. And while a lot of attention Sustainability’s
has been given to the semi-truck industry and how reducing carbon emissions on Inconvenient Truth
cross-country trips are great for the environment, parcel delivery companies have By Steve Banker ·
been seizing the momentum. Companies like UPS, HDL, FedEx, and others have 08/01/2022
piloted multiple programs using electric delivery vans and electric bikes or scooters
within congested cities for last mile deliveries. These pilots have shown that electric
bikes, vans, and scooters are fully capable of handling the demands of last mile
deliveries while pulling larger vehicles from already congested roads. Additionally,
autonomous robots and drones have garnered a lot of attention for their ability to
make last deliveries while reducing carbon emissions and congestion. Alternative
fuels are clearly an area that will continue to gain traction.
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Optimized Routes Supply Chain

A TMS can save shippers money in a lot of ways, including simulation and network
design, load consolidation and lower cost mode selections, and multi-stop route Brief
optimization. From a sustainability standpoint, route optimization is the big winner. LEARN MORE
Obviously load consolidation means less trucks on the road to deliver the same
freight, which is important as far as carbon emissions. But with route optimization,
companies can use algorithms to determine the most efficient route for every truck
on the road, from, cross-country deliveries to the final mile. By determining the
absolute ideal route for each truck, shippers are able to reduce their fuel costs and
their miles significantly; with backhaul optimization, deadhead miles can also be
reduced so trucks are not just carrying air to their next destination. Reducing miles
and fuel consumption is a key part of supply chain sustainability.

Returns and Recycling

A final way to improve supply chain sustainability is by optimizing returns at the
store and warehouse level. According to research I did around omni-channel
returns management, it became clear that sustainability practices are also an
important aspect of returns management.  Companies need to decide what they will
do with the returned item, which will vary based on the type of product.  Per our
survey, 64.2 percent of respondents indicated they re-use the returned item, and
sell it “as is.” This is common for apparel and other non-electronic items.  For
consumer electronics, things are a little trickier.  Here, 53.5 percent refurbish the
item and then sell it, while 26.7 percent remanufacture the item, which means the
item is held to higher standards than refurbishing.  When an item cannot be
salvaged, 60.7 percent of respondents recycle it. The decision to re-use, refurbish,
re-manufacture, or recycle goes a long ways to improving sustainable operations.

Final Word
Supply chain sustainability is increasingly important for the future of business and
the world as a whole. Companies are investing more money into sustainability
initiatives, seeking to reduce waste and carbon emissions. These initiatives include
eco-friendly packaging to eliminate waste, using energy more efficiently, using
alternative fuels and electric vehicles, improving delivery routes for less carbon
emissions, and ensuring that returns are re-sold, refurbished, or recycled. These
five steps are certainly in the right direction for a more sustainable supply chain.

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