The transition toward green supply chain

Ecology is one of the hottest topic of our time, and undoubtedly one of the issues of the century. The green supply chaine enables to cover the preservation of the environment and ecological issues by reducing the carbon footprint within companies in addition to respecting certain regulations.

What is green supply chain ?

The idea is simple: rethink the supply chain to reduce it’s ecological impact and preserve the environment. This requires work at each stage of the supply chain. This “green supply chain management” starts with the sourcing process, which has to be done as close as possible.

Standards and labels provide the basic framework for building an environmentally responsible sourcing process. Buyers can rely on criteria such as location, product characteristics (packaging, composition, recycling), environmental policy and production (waste management, renewable energy, etc.).

It is also necessary to provide support to suppliers throughout the cooperation process. There are programs that encourage companies to measure and analyze CO2 emissions.

This is the case, for example, of the Carbon Disclosure Project. In addition, the ADEME (French agency for ecological transition) and professional organizations also offer programs to help companies reduce the energy and environmental impact of their transport and logistics activities: shippers, freight forwarders, freight and wholesale companies, and also passenger transport companies.

In short, environmentally responsible sourcing is an important focus in order to reduce greenhouse gas emissions. While it does not directly reduce the company’s emissions, the strategy applies to emissions caused by the company’s operations.

The challenges are as follows:

– Management of regulatory, operational, economic and image risks for the company

– Controlling or even reducing costs, raw materials, energy or logistics

– Increasing sales and access to new markets through innovation

– The federating of teams around meaningful issues

– The adequacy with the demand of the final customer

– Optimization of recycling

The problem of transport

The transport of goods has become the world’s second largest emitter of greenhouse gases! Companies have to deal with increasingly saturated road traffic and therefore delivery delays generating financial penalties in addition to transport costs.

The “green transport” projects carried out by companies will focus on three areas

– Eco-driving: raising drivers’ awareness can have a significant impact

– Renewal of the road fleet by vehicles with alternative engines: an action to reduce direct emissions but which requires investments

– Acting on all the components of logistics: setting up controlled structures and processes

The rework of the logistics network is a strategic lever. This involves rethinking the logistics network and the connections between company and customer sites in order to reduce the distances travelled and increase vehicle fill rates. This is achieved by choosing direct delivery zones to position warehouses. Companies can also develop co-delivery.

Les défis traditionnels qui ont animé les chaînes d’approvisionnements consistaient à réduire les coûts, à assurer les livraisons à temps et à réduire les temps de transport pour permettre une meilleure réaction aux défis commerciaux.

The traditional challenges that have driven supply chains have been to reduce costs, ensure on-time delivery, and reduce transportation times to enable better response to business challenges.

In addition to sustainability and resilience, an ethical supply chain is imperative to ensure corporate social responsibility and adhere to the moral code of conduct. Consumers are increasingly demanding transparency and traceability in supply chains.