At a time when the climate emergency is forcing companies to rethink many aspects of their business, what about the supply chain? Given the importance of e-commerce in today's economy, it is essential to combine these two issues to achieve a responsible supply chain. Suppliers, shippers, carriers and partners all need to find ways of reducing their impact without reducing growth. To achieve this, the Green Supply Chain is an essential foundation.
What is a Green Supply Chain?
Opting for a Green Supply Chain - in other words, one that is both environmentally and socially responsible - means making far-reaching changes to processes. This usually begins with the appointment of a Green Supply Chain manager, who will be responsible for developing the entire sustainable supply chain, including logistics.
A Green Supply Chain therefore requires action at various stages:
- The use of raw materials from sustainable sources
- The use of clean technologies
- Reducing and reusing packaging
- Reducing waste
- Optimizing transport flows
- Flow traceability
- Responsibility for workers
- Etc.
What are the benefits of a Green Supply Chain?
For a long time, the Green Supply Chain was seen as a coquetry that didn't apply to the big boys. After all, it's not a new terminology - it's already a decade old. However, climate change and its already tangible consequences around the world are now driving supply chain players to adopt new CSR methods and practices.
As a survey byAgility in 2022, whose Emerging Markets Logistics Index is a good indicator of trends, shows, this sector is particularly optimistic. And that's without setting aside these essential aspects. Like the other countries surveyed, China and India are also rated on their efforts to reduce emissions and their green initiatives.
The benefits outweigh the additional costs: starting with the reduction in resource consumption and CO2 emissions.
Energy performance
A responsible Supply Chain is automatically a lever for lower consumption for all players: electricity, water, fuel, all consumptions are reduced.
Cost reduction
Mechanically, lower consumption and all the measures taken to limit waste help to reduce production and management costs.
The reputation
While this may seem a minor issue in the face of climate change, companies cannot afford to ignore their reputation in this area. What's more, given the expectations of the new generations (only 19% of Generation Z are prepared to work for a company that doesn't agree with their values, according to a study by Hays), it's essential to make a real commitment.
What can you do to make your supply chain more responsible?
As a shipper, you can implement a number of levers to make your supply chain more responsible.
- This starts with measuring your environmental footprint and carbon footprint throughout the supply chain. This means knowing your suppliers' carbon footprints.
- You then need to rethink your raw materials sourcing strategy (for example, by choosing local suppliers), packaging, and transportation methods. In particular, the Green Supply Chain requires you to consolidate journeys and loads, and rationalize routes.
- This also implies thinking in terms of the circular economy, and therefore reuse, as part of what we call reverse logistics.
A TMS for Green Supply Chain Management
Among the various solutions available to create a Green Supply Chain, the adoption of a Transport Management System (TMS) is particularly useful. In addition to its numerous solutions, it enables the creation of more responsible logistics schemes by :
- Providing the best transport options for each destination
- Route optimization to reduce mileage and fuel consumption
- Grouping loads to reduce the number of transports
Implementing a TMS tool is also a good way of digitizing your supply chain and making production savings, while increasing productivity.
In view of the climate emergency and the changes that society as a whole must make, and as international trade increases, the Green Supply Chain is no longer an option. As a result, all solutions that help reduce environmental impact must be taken into account.
