Sustainability and carbon-emissions reduction is now a perennial concern for retailers, but many have recently been confronting more immediate supply chain and warehousing challenges related to the coronavirus pandemic. It can be difficult to think about instilling environmentally friendly corporate practices when congestion at the West Coast ports and continued logistics disruptions have meant one sourcing headache after another.
It makes sense that sustainability might not be top of mind in the current environment, but carbon-reduction concerns have actually increased during the coronavirus pandemic. In the FreightWaves report “Net-zero carbon is more than a cause,” researchers found that “a combination of personal passion, customer demand, and corporate social responsibility is driving the industry’s growing enthusiasm and strategy for sustainability.”
All this focus on freight transportation makes is apparent when you look at the statistics: The Environmental Protection Agency pegs the greenhouse gas emissions for transportation in the U.S. at 29 percent. The International Transport Forum finds that the exact number for freight moves is roughly 7 percent of global emissions. That’s a huge carbon footprint for the trucks, railroads and parcel vehicles that, among other things, transport retail goods to customers. So it’s clear that optimizing supply chain transportation routing in the near term should be a major focus for retailers looking to eliminate greenhouse gases from their operations.
Consumers are demanding greenhouse gas reduction from their retailers
Why is sustainability in supply chain practices important? Purchasing from green, environmentally responsible companies is on the mind of consumers. Last summer, New York University recently found that despite the pandemic, CPG products marketed as sustainable grew faster than status-quo offerings.
In the FreightWaves report, respondents pointed to personal passion, customer demand, and corporate goals as the main sustainability drivers at their logistics companies. Around 40 percent of those surveyed have an eye toward evolving laws and regulations, where 30 percent have a goal to implement environmentally friendly logistics practices because of financial savings. Sustainability can also be seen as a competitive advantage.
“While efforts toward sustainability create satisfaction among a company’s employees, they can also attract customers and promote profitability,” FreightWaves found.
Supply chain stakeholders surveyed painted a more hesitant picture about the supply chain field. Roughly a quarter of the respondents said the industry as a whole is ambivalent about supply chain sustainability or doesn’t feel the need to take action. The remaining 76 percent of those surveyed believe the industry is turning a corner on sustainability in the supply chain and is ready to take action to create a more carbon-efficient reality.
While it might take some internal buy-in to create a sustainable culture internally, consumers are making their choices clear. Where the government is concerned, sustainability might be a more pressing issue outside of the United States where regulations against emissions are already robust, but movement domestically is happening. In addition to the carbon-neutral pledges made by large companies, there are signs that sustainability regulations may be around the corner.
It’s apparent that logistics sustainability and carbon reduction across all aspects of the value chain is no longer a nice to have. But it’s also clear that many retailers, despite the calls they are hearing from values-conscious consumers, don’t know where to start on their journey to reduce greenhouse gases.
What is supply chain sustainability?
Companies throughout the supply chain have different opinions of supply chain sustainability, just as there are many different tactics to take when reducing overall waste in the supply chain. Blume Global has contracted with South Pole, a leading climate solutions provider, to measure and reduce its greenhouse gas input, becoming a carbon-neutral supply chain technology provider in the process.
Sustainability deals with reducing the carbon footprint of supply chain transportation, restoring green spaces, eliminating the utilization of single-use plastics, green packaging, and the like. But companies can also focus on ethical or responsible sourcing, promoting diverse and equitable hiring practices, and promoting a culture focused on eliminating waste. Just as there are many different definitions of sustainability, there’s no one way to get started on the supply chain sustainability path.
Digitizing processes for a greener environment
Streamlining operations and committing to innovative supply chain technology practices are crucial. Digitizing manual processes makes for a more efficient organization, adds agility and flexibility into your operations, and allows you to instill a sustainability mindset at the core of your operations.
Innovative technologies offered by supply chain technology firms can make a huge impact on supply chain sustainability by eliminating empty miles, improving asset efficiency, and even helping shippers and third-party logistics (3PL) providers measure the carbon impact of their supply chain decisions while they wait for cleaner energy sources. Utilizing technology to weigh CO2 emissions as a key criterion for carrier selection can also make an immediate difference.
In a recent sustainability blog, Gartner’s Sarah Watt explained why the time is now to commit to sustainability goals. She suggested viewing sustainability as an opportunity – one that is best embraced sooner than later.
To speed up engagement with sustainability goals, Watt suggested engaging in technology, realizing customer expectations, and collaborating or seeking partnerships with providers that can speed up a company’s adoption of green practices.
“With many enterprises committing to net-zero greenhouse gas emissions, it is prudent to act early to lock in initial savings and create more time to manage more challenging elements of the supply chain to decarbonize.”
To do all that, retailers need a trusted partner.
The carbon-neutral supply chain technology provider Blume Global is part of the sustainability discussion at every logistics company, helping stakeholders make better, greener selections when considering freight transportation options and showing them how to use technology to reduce carbon emissions in the supply chain.
Ready to see how Blume can help with your supply chain sustainability goals?