Green Logistics

The word of the moment is “sustainability”.  Sustainable transport, sustainable waste management, sustainable warehousing; we’ve heard them all.  But really it’s about sustainable business because, as we all know, rising energy costs have a direct impact on the bottom line.  So what do supply chain managers need to do to ensure that their business can thrive in the years ahead when energy becomes more expensive and Government legislates to drive us towards reducing emissions?

Modern supply chains have become more and more complex with many interdependencies between the various parties.  Managers have to be concerned with reducing the energy use of buildings, the relative merits of various modes of transport, the design of packaging and the costs of waste disposal, to name just a few.  Each of these can place conflicting demands on the supply chain processes.  And to stay in business we have to satisfy our customers who are continually expecting better service and, rightly or wrongly, greater choice and faster response.  There is no easy answer to dealing with these problems but what is clear is that sooner or later we will have to think about supply chain development in a completely new way, where energy use and environmental considerations are the driving forces.  Green logistics and sustainable supply chains are now moving right to the top of the agenda.  Could it be that customer choice and speed of response will have to give away as we move into this new world-order?

The culture of “I want it now and I want it cheap” on the part of consumers and the lean, is just in time stock management principles demanded by manufacturers and retailers has resulted in some very inefficient logistics practices - lots of small delivery vans and part full vehicles rushing around the country trying to satisfy every whim regardless of its environmental impact.  There is plenty of research evidence to show that although HGV traffic has not grown as fast as the overall economy in recent years (bucking the long term trend) white van traffic has vastly increased.  And as we know the smaller the vehicle the more carbon per tonne mile is emitted.  Also there is evidence that vehicle fill is not improving as much as it should given the focus of attention it has received.

So what is to be done?  As you might expect there is no single solution.  It will require some or all of the following measures to make an impact:-

• Education - the majority of consumers are totally unaware of the environmental impact of the decisions they make and so need to be told the carbon impact of the choices they make through labelling and clearly presented information

• Government - needs to develop a clear transport policy that encourages efficient behaviour which generally means minimising movement, maximising the size of vehicles being used and maximising their fill

• Manufacturers and retailers - need to give more priority to ordering in full vehicle loads.  Where this is not possible consolidation centres and the like should be used to bulk up loads.  This will increase stock holding but reduce carbon so long as it does not lead to increased waste.

• Product range - consumers sum to like retailers increasingly larger and larger ranges but this creates inefficiencies.  The likes of Aldi and Lidl have shown that customers can still be attracted to stores with much smaller ranges and this is a patter that other retailers will do well to emulate.

THE LOGISTICS BUSINESS, a leading specialist supply chain and logistics consultancy, has experience in planning and developing supply chain, distribution and warehousing operations throughout the world. From supply chain and distribution strategy, to development of distribution operations, warehouse design and layout, as well as manufacturing logistics and IT systems design, its clients include many blue chip companies.

We have also worked on government initiatives on sustainable transport and waste minimisation. For further information please call:Helen Morris, THE LOGISTICS BUSINESS on +44(0)1527 889 060, email helen.morris@logistics.co.uk