Planning a Greener Supply Chain

September 16, 2008

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Andrew Kinder, director of products marketing for Supply Chain Mangement at Infor, writes in IndustryWeek that U.S. manufacturers are positioned to lead the world in lowering carbon emissions by using technology and innovation to reduce their energy consumption and optimize their supply chain.

Manufacturers can foster green supply chains by:

– Optimizing the physical supply chain and the storage and transportation of products across it.
– Lowering energy use in the manufacturing conversion process.
– Improving product design.
– Packaging to minimize waste.
– Increasing the recycled content of products.

Using supply chain management principles will help manufactures factor in the cost and benefits of variables like alternative transportation modes, fuel costs and the carbon impacts of these decisions.

Kinder says greening supply chains is about creating efficiencies to remove waste from the system. This can be done by modeling carbon emissions within strategic network designs, which allows companies to track and model costs and emissions. According to Kinder, the models allow manufactures to see the immediate impact of network changes to the supply chain and the bottom line.

In June, 37 of the UK’s largest food and drink companies agreed to participate in a “Sustainable Distribution” initiative that will result in the removal of 800 trucks from UK roads this year and save 23 million liters of diesel fuel per year.

The UK is also testing longer, heavier vehicles as a way to cut carbon emissions from the supply chain.

Many companies, such as Tesco, Nestle, L’Oreal, and Pepsi have joined the Carbon Disclosure Project’s Supply Chain Leadership Collaboration, which asks suppliers for emissions info.

Some companies, like Method are also providing incentives for supply chains to reduce emissions.

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