By making positive changes such as these to the structure of your distribution, your business can help significantly improve the efficiency and sustainability of its distribution. You will need to balance distance with cost when it comes to sourcing your suppliers – you may find a supplier who can offer a more competitive cost, but who is much further afield, increasing the miles (and length of time) your stock has to travel. Link supply-chain sustainability goals to the global sustainability agenda Once companies know where their supply-chain issues are, they can set goals for lessening the resulting impact. Waste must be reduced and, in most cases, it must be reduced significantly. Please send me your fortnightly Email Bulletin. (For the specific selection criteria, see the “About the Research” sidebar.) Notify me of followup comments via e-mail. As with any transformation, the first step to a more sustainable supply chain is to gain an... 2. Copyright © 2020 Logistics Bureau Pty Ltd. SEO by Online Marketing Whiz. How to Create a More Sustainable Supply Chain Realistically project customer demand. The above points are just potential solutions and components to address to help achieve a more sustainable supply chain for your company. Another way to quickly cut down on distribution distance and reduce your business’s carbon footprint is to source materials closer to your manufacturing location. The good news is that there are multiple benefits attached to developing a sustainable supply chain. Distribution efficiency comes down to understanding how far your materials have to travel and how many truckloads are being used to transport these materials. It is tempting to view prioritising sustainable practices as choosing the planet over profit. Resource Management Associates is known for helping companies in all phases of supply chain management, from vetting suppliers to delivering supply chain documentation to product end-users. 3 Crucial Steps To Developing A Sustainable Supply Chain 1. But is your water consumption really an issue? In a recent MIT SMR article, I argued that a sustainable supply chain “must operate within the thresholds imposed by nature and society.” Unfortunately, references to these thresholds are rare. Then highlight any points where you see potential for improved sustainability. Ensuring sustainability is cyclical, but can have an extreme impact on your own business costs, as well as environmental impact. Having established improvement priorities and engaged your managers, workforce and partners, it’s time to execute steps to meet the most pressing sustainability goals. It will also reduce costs and improve efficiencies, creating a better workplace for your employees and a more sustainable environment for the world. Identify sustainability issues within the supply chain. Social and environmental variables are the basis of sustainability and, not surprisingly, the basis of strategic, lasting site selection decisions. Chapter 2.3: Ingredients of a sustainable supply chain strategy Chapter 2.4: Iterative approach for developing your sustainable supply chain strategy bestLog: Need for a Sustainable Supply Chain Strategy Recognising and assessment of trends Strategic and holistic approach Balancing economical, ecological, and social objectives “6 Steps to Sustainable Supply Chain Reality”, 4 Tips to Help You Choose Distribution Centre Locations, The What, Why, How of Supply Chain Benchmarking, 4 Common 3PL Mistakes on Logistics Outsourcing Contract, 6 Steps to Sustainable Supply Chain Reality, Trace every product, from raw material to finished product, Identify all your suppliers, including those you didn’t know you had. If you are currently dependent for over 30% of your income from one major source, this could be a time when you need to rapidly reinvent yourself. If you're a company that does have printing needs, then it's time to identify the volume of printed material your business requires, in order to better lower the volume of wasted print. When they know what to look for, they can add granularity to your search for environmental performance excellence. With the effects of climate change high on the international agenda, organisations are trying to go even greener than ever. This provides more accurate information in regards to stock and removes the level of guesswork, so you can reduce the volume of redundant, unnecessary stock your business is ordering. Best Regards, Rob O’Byrne Email: [email protected] Phone: +61 417 417 307, Your email address will not be published. Occasionally you may even need to go back to the drawing board. After you have benchmarked your supply chain for sustainability, you will have the intelligence you need to set goals and decide upon the metrics to employ for progress monitoring. Building a sustainable supply chain. How to Develop a Sustainable Supply Chain 1. Required fields are marked *. This is where technology can come to the rescue. A simple solution is to go digital. Every supply chain is unique, so it’s hard to prescribe exactly how sustainability should be tackled. The concept of sustainable development can be attributed to the 1987 Brundtland Report, which described it as ‘‘development that meets the needs of the present without compromising the ability of future generations to meet their needs’’. Outcomes will not always be as expected and solutions will sometimes need to be tweaked. Wasted orders due to poor quality or faultiness equal wasted time, money, and resources. If you want your business to have long-term success, you have to create sustainable supply chains. Being sustainable is no longer a case of being cutting edge; sustainability is now a given, so if you haven’t considered sustainability in your business and your supply chain, you may be vastly behind your competitors. If this wasn’t good enough, by outsourcing to a print management company, your business could save even more. This is where sustainability benchmarking can really help you home in on where improvement is most needed. Take for instance 10 suppliers, and let them make 1 sustainable change in their supply chain, and ask them to do the same with 10 of their suppliers. When it comes to managing wasted stock, intelligent stock analysis software can monitor existing stock accurately and offer solutions. Sustainable practice is the only way to guarantee your business will succeed long into the future. It can also enhance collaboration between companies by pinpointing opportunities for shared shipping, trucking, and warehousing—which in turn can have a significant impact on carbon emissions. How can you cut costs, whilst utilising the best suppliers at the procurement stage? Develop some form of a sustainability plan for your business. Whether in your own company or with your suppliers, it’s important to ensure that your business practices are sustainable for the long term. Although it is often identified as being one of the most difficult aspects of a business to make sustainable, it is one of the … To understand how you can improve your... 2. Since sustainability often involves consuming less and achieving greater efficiency, environmental performance improvements can often lead to cost savings and a more streamlined operation. The waste management industry is set to grow to $560 billion dollars (£400 billion) by 2020, powered by smart waste technologies. As legislation focuses ever more heavily on environmental protection though, and consumers increasingly consider sustainability in their purchasing decisions, all supply chain organisations will need to find the way forward. Here are some ways you can make the supply chain in your organisation more sustainable. Your suppliers may handle delivery needs for you, but it’s important to ask your suppliers about their sustainability practices. If your company is serious about developing a sustainable supply chain, the six steps described here will need to become a continuous cycle. Customers are also becoming increasingly active in supporting these measures. Develop a policy for your suppliers and customers. Environment, 4 Ways to Create a Sustainable Supply Chain in Your Business. Manufacturers need to create new ways to manage and track their practices in the supply chain, manufacturing process, and in sales and marketing. By reining in printing expenditure, businesses can see an annual savings of at least 50%. As with any transformation, the first step to a more sustainable supply chain is to gain an intimate understanding of the current environment. Yes! Supply Chain Sustainability starts with effective Training and Development Sustainable supply chain is arguably one of the major requirements currently facing organizations. 2. With the supply of raw materials dwindling, it makes good economic sense for manufacturers to take discarded materials and repurpose them. With all of this in mind, it’s easy to understand how these figures can soon start to add up and hinder the sustainability goals of your business. End-to-end supply chain transparency is critical; sustainability initiatives must extend from raw materials sourcing, to last-mile logistics, and even to product returns and recycling processes. Since then, at an exponential rate, companies have been focusing on ways to reduce harmful emissions, minimise waste, and make their facilities more energy-efficient. Due to global concerns about climate change, sustainable supply chain practices should be a way of life for all businesses, in order to manage resources now and into the future. Various programmes allow you to: Led by multinational corporations, the trend by big companies in recent years has been to work only with suppliers that maintain high social and environmental standards. By all means, dust off your old swim-lane diagrams if they are not too outdated, but be sure to review them all with a focus on resource consumption, waste, and efficiency. All of the suppliers you work with should have their own practices in place where they manage their own waste – and manage the sustainability of their own supply chains. If you are in the initial stages of sourcing suppliers, it’s important to remember that a low cost doesn’t always equal a high-quality supplier. Prioritising sustainability can boost your branding efforts, protect against reputational damage and ultimately lead to more sales and increased revenue. Here at Anthesis we can help you understand where the risks and opportunities are in your supply chains using our proven methods and tools, as well as helping to develop and deliver a prioritised action programme. While your company undoubtedly has sustainability on its supply chain agenda, creating momentum can be tricky in what is after all, a fairly new way to approach performance improvement. A sustainable supply chain must avoid compromising both the environment and the business itself. Find out by downloading our guide, The Four Stages of Procurement Savings. You can also implement it in your business supply chain. How can supply chain sustainability risks impact your business? 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