More and more businesses around the world are putting sustainability at the center of their growth strategies, and the logistics industry is no different. This is a crucial decision towards a green future, as the supply chain is one of the major contributors to emissions for basically every company that sells physical products.
According to a global supply chain report released in 2020 by CDP, supply chains amount to 92% of an organization’s greenhouse gas (GHG) emissions. This is because, on average, supply chain emissions are 11.4x higher than operational emissions.
To make global logistics more sustainable for any business, efforts have to be made to make the supply chain eco-friendly.
Aside from the moral and regulatory imperatives, there’s a strong business case for cleaner supply chains. Some 85% of consumers will opt to purchase from a company that is sustainable if the prices are the same. This makes all the investment for a greener supply chain worth it.
One way to make progress in that direction is by leveraging data. Data reveals the ins and outs of a process objectively, quantifying things to help us see if we’re making progress towards a goal.
In this article, we have pointed out three ways in which data has helped brands all around the world reduce their supply chain carbon footprints.
1. Secure shipment of goods
According to Packaging Digest, 11% of goods sustain some degree of damage by the time they reach the distribution center.
Transporting volatile products that are sensitive to environmental conditions is challenging to say the least. Even a temporary deviation from recommended storage conditions during shipping can render the goods unusable by permanently damaging them.
Goods damaged in transit do more than just hurt your profits and business partnerships. Involved parties have to put in extra work to make sure that the damage is undone and the customer’s requirements are fulfilled.
That extra work drastically increases the carbon footprint, as it involves transporting the damaged goods again, spending resources to repair/replace them, and re-shipping them back to the destination.
Logmore, a company out of Finland, solves this problem by developing a data-based logistics condition monitoring solution. Shipping containers and even individual packages are equipped with sensors that constantly monitor the vitals such as temperature and shock. The stats are securely updated to the cloud when the QR code outside the container is scanned through a smartphone.
This makes it easy for vendors and other interested parties to track the health of shipped goods, in real-time, remotely. Furthermore, vendors can set customizable triggers that will let them know if any of the vitals deviate from within the desired range. Logmore has already helped many pharmaceutical companies, food wholesalers, and other global enterprises reduce the spoilage of goods in transit.
Accurate surveillance also makes the quality assurance (QA) process easier. For instance, bioMérieux, an industry leader in in-vitro diagnostics, slashed its QA workload by 25% through automated temperature analysis.
2. Eco-friendly packaging
As the eCommerce industry continues to boom, the demand for packaging has increased. According to a report by Mordor Intelligence, the eCommerce packaging market was valued to be $27.04B in 2020 and will be at $61.55B by 2026.
Inefficient packaging methods consume more-than-necessary resources and waste energy, leading to an overall higher carbon footprint.
Many companies are emerging to help solve this problem. One such company is EcoEnclose, which has started to make a difference by providing personalized eco-friendly packaging solutions to eCommerce brands. They have already helped many online stores reduce their carbon footprint through biodegradable and compostable packaging materials.
The packaging solutions they offer are plastic-free, and even the ink that they use on the box is compostable, giving back to the environment. EcoEnclose offers packaging solutions for multiple products including consumable products like oils and soaps.
Let’s take a quick look at an example where innovative packaging has made an impact. Amazon, the global eCommerce giant, has made great leaps in this regard by eliminating more than 25K tonnes of plastic per year. They have included paper-based mailers, using recycled paper boxes, and reduced plastic in their packaging solutions.
3. Automated warehousing
Lack of updated inventory, suboptimal picking paths, and inefficient storage of goods are some of the challenges faced in warehouses. Again, these roadblocks consume more than necessary resources for the same outcome.
For instance, if the picking-and-dropping paths of goods are not optimized, it will take longer than usual to get the product shipped. To make the process faster, the interested parties have to invest in a larger warehouse or hire more individuals.
With more people and a larger working area, the possibility of human error increases. All these mistakes result in rework that consumes more resources, ultimately increasing the overall carbon footprint of the warehouse.
One solution to this is using warehouse automation, something Swisslog is helping eCommerce companies achieve. The Switzerland-based company specializes in developing tools and layouts that help eCommerce companies automate their warehouse operations.
As a result, they get more done in less time, with fewer mistakes. This means less rework, and minimum wastage of their resources, reducing supply chain carbon footprint. The company has helped various industries such as beverage, pharmaceuticals, and retail automate their workflows and managed to reduce energy consumption by 20% through automated distribution.
One of the best examples of automated warehousing is Ocado Retail. With the help of robots, they have managed to automate their entire warehouse. This has eliminated human error completely and also enables them to run the warehouse in a “lights-out” mode.
Many other elements of the supply chain are becoming eco-friendly with the help of data. Advances in machine learning, alternative fuels, and material science promise a more sustainable supply chain in the future.
For example, Maersk, the global shipping giant, uses e-methanol in its vessels, which is a carbon-neutral fuel and is 100% renewable. The use of drones and self-driving trucks to deliver packages can further reduce energy consumption in the last-mile delivery.
All in all, big data is and will continue to play a key role in optimizing the supply chain carbon footprint.
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