According to the Inventory of U.S. Greenhouse Gas Emissions and Sinks 1990-2017–the national inventory that the U.S. prepares annually under the United Nations Framework Convention on Climate Change–transportation accounted for the largest portion (29 percent) of total U.S. greenhouse gas emissions in 2017, which includes cars, trucks, commercial aircraft, railroads and all other sources. On average, more than seven percent of an industry’s carbon footprint is attributed to emissions from the supply chain.
As you can see, the transportation industry has a role to play in the reduction of greenhouse gas emissions. Greenhouse gas emissions are a main contributor to climate change and global warming. Manufacturers, retailers and logistics companies can reduce their carbon footprint by changing the way they do business. This includes reducing waste in the supply chain, improving energy efficiency, conserving natural resources and promoting the use of clean energy.
Reducing your supply chain carbon footprint can help you reduce your operating expenses, improve revenue and make the right impression on potential business partners and consumers–particularly those that want to preserve the natural environment. Regardless of what role your company plays in the U.S. supply chain, use these tips to reduce your supply chain carbon footprint.
1. Measuring and Reporting Your Carbon Emissions
Do you know the carbon footprint of your supply chain? The first step toward reducing your carbon footprint is to measure and report your supply chain carbon footprint. Knowing the amount of energy your business consumes in the making and transportation of your products will help you understand the full scope of your carbon footprint. This should include every aspect of your supply chain, including your suppliers, manufacturing facilities and all transportation methods.
To measure your carbon footprint, make a record of your energy expenditures and ask your suppliers and business partners to do the same. Keep track of the amount of materials you use, how they’re manufactured or procured and how they’re incorporated into the supply chain. Once you know the supply chain carbon footprint, you can set clear goals for reducing your impact on the environment.
2. Creating a More Centralized Supply Chain Network
Many manufacturers and retailers will contract with suppliers in other countries to lower the cost of production, but this increases the distance that these goods and materials need to travel in order to reach the end consumer. If you contract with suppliers and retailers across the globe, this will also increase your shipping and transportation costs, all of which contributes to your supply chain carbon footprint.
To reduce your supply chain carbon footprint, consider creating a more centralized supply chain network by doing business with suppliers that are physically closer to your manufacturing or retail facility. This reduces the distance your products and materials will need to travel throughout the supply chain, thus reducing fuel consumption. While local suppliers and manufacturers may charge more for their products and materials, you can reduce your fuel costs and your overall carbon footprint.
3. Partner with Sustainable Suppliers
Your suppliers are an integral part of your business and your supply chain carbon footprint. Every supplier has their own way of doing business, including manufacturing and transporting raw materials, but instead of changing the way your existing suppliers do business, consider partnering with suppliers that go out of their way to protect the environment. In addition to finding suppliers closer to your manufacturing or retail facility, select those that use recycled packaging materials, clean energy and other environmentally conscious business practices.
As you go about vetting potential suppliers, ask to see a record of their carbon footprint. You can also audit their manufacturing facilities to make sure they’re using sustainable methods of production. Find suppliers that share your commitment to the environment, so you can change your entire business model for the better.
4. Keeping Your Customers Informed
More consumers are expressing concern for the environment and many are changing their shopping habits accordingly. But many retailers and manufacturers leave their customers and clients in the dark when it comes to the carbon footprint of these transactions. Adding information about the manufacturing and transportation process can help change your customers’ shopping habits to make them more conscious of their effect on the environment.
Consider adding a carbon footprint calculator to your website where your customers and clients can see how much energy will be consumed when placing their orders. Suggest environmentally friendly alternatives to alter their shopping habits and increase energy efficiency and the use of recycled materials while reducing the distance between your products and customers.
5. Taking Advantage of New Technology
Technology has the potential to improve the sustainability of the U.S. supply chain. Consider incorporating 3D printing, or additive manufacturing, into your business model. This reduces waste in the supply chain by building up goods and materials during the manufacturing process rather than removing them from a large whole and letting the rest go to waste.
In terms of transportation, consider investing in self-driving vehicles with energy-efficient settings, such as automatically reducing their speed and fuel consumption. You can also take advantage of energy-efficient route optimization tools to further reduce your supply chain carbon footprint.
6. Optimizing Warehouses and Manufacturing Facilities
To improve energy efficiency throughout your warehouses and manufacturing facilities, invest in clean energy such as solar panels and wind energy. Start a facility recycling program and teach your employees how to properly recycle unused materials. You can also utilize used shipping containers to reduce the number of shipping containers being manufactured, which consumes precious natural resources.
Take the First Steps to Reduce Your Carbon Footprint
Reducing your supply chain carbon footprint can be challenging as a business owner, but more consumers and businesses are looking to give their business to companies that respect and preserve the natural environment. The threat of climate change and global warming becomes more imminent every year. Use these tips to transform the way you do business, so you can send a message of sustainability to your customers and business partners.
David Madden is an efficiency expert, as well as being the Founder and President of Container Exchanger. His passion and business is to save companies money through the use of used reusable and repurposed industrial packaging such as plastic and metal bulk containers, gaylord boxes, bulk bags, pallets, IBC totes, and industrial racks. He holds an MBA as well as a certificate from Daimler Chrysler Quality Institute for completion of six-sigma black belt training.
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