Many sectors are under increasing scrutiny from the public and regulators alike when it comes to supply chain sustainability and environmental impact. McKinsey estimates that 90% of companies’ impacts on the environment come from supply chains, due to the growing distances products need to travel as markets become more global than ever before. When it comes to consumer goods for instance, most of the sector's environmental impact comes from the supply chain:
Greater societal awareness of climate change, environmental impact and sustainability have left organizations with no choice but to acknowledge and respond to these pressures, both voluntarily and due to legal requirements as authorities around the world introduce new regulations and step up enforcement efforts. Although operating in more environmentally friendly ways can sometimes help supply chains reduce costs and increase profitability, many activities relating to becoming greener require some form of investment.
Examples include, implementing environmental management systems, joining product or building certification programs, setting up reporting or disclosure programs and paying towards carbon tax and offsetting.
A more sustainable supply chain starts with its design. Objective data, along with full transparency, is required in order to thoroughly understand what a supply chain’s existing environmental impacts are. Organizations must know their starting point in order to ensure they can measure progress towards their sustainability goals.
Real-time transportation visibility (RTTV) platforms provide both the objective data and the operational visibility of transport activities, providing a concrete baseline from which advancements in sustainability can be measured. Beyond that, the data can of course also be used to optimize day-to-day operations, which not only reduces operating costs but also the carbon footprint, as fuel consumption reduces with lower kilometers travelled.
In addition, the sharing of real-time data throughout supply chain collaborators makes ‘reverse logistics’ possible, which refers to all operations relating to the reuse of products and materials. Returnable packaging, such as a pallet, is an example of a component of reverse logistics. An RTTV solution’s mobile app can be used to scan and track a pallet’s barcode to help ensure it is returned to the correct shipper for reuse upon completion of a delivery. Collaboration benefits also include better utilization of containers and transportation to consolidate shipments (LTL), further reducing capacity wastage.
As well efficiency, cost and environmental impact benefits, supply chain sustainability efforts can have a great impact on the perceptions of a brand within the market. These perceptions can also improve internal perceptions of employees, reinforcing corporate values with concrete actions and results.
When it comes to improving supply chain sustainability, there are no shortcuts. An organization’s sustainability journey is a marathon, not a sprint, requiring significant investment and innovation. However transportation visibility can be a helpful first step.
To find out more about Shippeo’s real-time transportation visibility solutions and the potential impact of visibility on supply chain sustainability, please reach out to our team of experts.
Discover how Shippeo won the 2019 ECR Award for sustainability for a collaboration with European juice manufacturer Eckes-Granini and German hypermarket chain Kaufland.
Learn about the 5 main objectives that lead market-leading companies to adopt a supply chain visibility solution.
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