Most large corporations know that their supply chains are now visible. When a factory explosion in China impacts parts shipments to Apple in the United States, for example, it makes the news. Also, as consumers become more informed, potential for brand loyalty increases for those organizations reducing their harmful emissions and their carbon footprints through more efficient, money-saving supply chain management.
Bottom line? Staying clean is not only healthier, it’s smarter for business. Earlier this week at a Council of Supply Chain Management Professionals conference, I explained more about this concept and suggested steps toward improving goods movement operations.
Why it matters
Freight emissions are growing rapidly.
Freight transport is the single largest source of corporate carbon emissions, accounting for 15 percent of all emissions. In the U.S. alone, emissions from freight have been projected to increase 74 percent from 2005 to 2035. China is expected to increase its use of freight transportation fuels by 4.5 percent per year from 2008 to 2035. Over the coming decades, freight transport will be among the fastest-growing source of emissions, projected to increase 40 percent globally.
Retailers and other manufacturers exercise significant control over the environmental footprint of supply chain logistics operations. Their decisions on where products are made and stored, how they are designed and packaged, and how much time is allotted for transit have a tremendous impact on carbon and other air pollutants and cost efficiency.
These shippers have the most to gain from an increasingly cleaner and cost-efficient freight system and they can reap the greatest financial rewards from increasing efficiency. On top of that, public perception improves from an organizational “good environmental steward” image, increasing the brand loyalty odds in your favor.
Next page: Five principles for improving supply chain efficiency and sustainability