Green supply chains are not a new concept.. Although the concept dates all the way back to the 1960s, it wasn’t until the last decade that a formalised approach to sustainability called green supply chain management emerged (GSCM). Businesses across all industries are now utilising GSCM to reduce costs, improve quality, and increase profits.
Businesses that implemented sustainable business practises experienced lower costs, increased profits, and improved environmental performance compared to those that did not.
Green supply chains are intricate and are seemingly time-consuming to manage as they frequently involve a large number of stakeholders throughout the supply chain. Aside from it being perceived as a process that makes it difficult to keep track of all the data necessary to ensure sustainability, there are also legal considerations on what constitutes sustainable practises.
What is a Sustainable Green Supply Chain, exactly?
The term “sustainable green supply chain” was coined by the World Economic Forum (WEF) in 2002. It describes a supply chain model that aims to improve environmental performance throughout the supply chain by implementing best practises. These include product design, material sourcing and selection, manufacturing, and distribution.
Green supply chain management encourages businesses to innovate by developing new environmentally friendly products, processes, and services. Additionally, it aids them in increasing operational efficiency and customer satisfaction.
The Most Effective Practices
Green supply chain management is becoming more critical for businesses seeking to minimise their environmental impact. It entails the use of environmentally friendly materials and processes, waste reduction, and energy conservation.
Practices in supply chain management that are environmentally friendly
By reducing energy consumption, waste generation, and pollution, sustainable operations seek to minimise environmental impacts. Additionally, it seeks to enhance worker and community health and safety through improved working conditions, safer products, and reduced exposure to hazardous materials.
Green Sourcing
Green sourcing is the process of ensuring that raw materials used in manufacturing and production are derived from environmentally friendly sources that consume the least energy and produce the least waste. Eco sourcing is critical for environmentally friendly production and distribution, which is why it is a critical first step in establishing a green business.
Sustainable Design
Sustainable design is a process that results in products that generate less waste while maintaining their efficiency. Green design can refer to the process of developing and manufacturing tangible consumer goods, packaging, buildings, and associated infrastructure. Additionally, it benefits consumer well-being and thus public health.
Green Production
transportation, renewable energy, and local economies. Green production is based on infrastructure and technology that all contribute to the reduction of a product’s carbon footprint.
Green Warehousing
Green warehousing is a method of inventory management and storage that focuses on environmentally friendly urban warehouses. These warehouses emit the fewest glasshouse gases, employ environmentally friendly transportation methods, and manage eco-friendly packaging. They will be ahead of their competitors when green practises become mandatory by future-proofing their entire manufacturing and distribution processes.
Distribution With an emphasis on greener strategies, sustainable distribution is critical for logistics optimisation. Businesses must place a premium on supplier management in order to develop and measure a long-term distribution strategy. Especially when it comes to freight logistics, which has the highest carbon footprint.
Green Shipments
Green shipments are those that keep shipping costs low while producing waste and resources sustainably. Last-mile delivery solutions address all logistical challenges. They assist local zero-emission businesses and contribute to improved air quality by making carbon-free deliveries.
Reverse logistics and environmentally friendly transportation
Reverse logistics, or the return of goods for recycling or repair, is critical to the sustainability of logistics and supply chains. To participate in waste reduction strategies, customers must have transparent and efficient processes in place. Businesses cannot process returns and support product recycling without a strong reverse logistics strategy.
Sustainable operations have evolved from a concern for environmental impact to a critical component of business strategy. It is now considered critical to a business’s success. A green supply chain is one in which all aspects of the chain are designed to have a minimal negative impact on the environment.
Biofuels and alternative sources of energy
Biofuels are hydrocarbon-based liquid fuels derived from biological sources such as crops, animal fats, vegetable oils, and waste. They are considered sustainable because they are made from renewable resources and have a negligible impact on climate change.
The Benefits of Sustainable Supply Chain Management
There are numerous advantages to implementing green supply chain management that are sustainable.
The first advantage is that the system fares better in terms of environmental performance. Businesses can contribute to environmental protection while also saving money by implementing green supply chain principles. Additionally, they can conserve energy and reduce their carbon footprint.
Second, sustainable green supply chain management creates opportunities for innovation. Businesses can develop novel solutions to pressing global issues like global warming and resource depletion.
Thirdly, a sustainable green supply chain improves people’s quality of life. Businesses can contribute to job creation and wage increases by implementing sound business practises. Additionally, they can contribute to the improvement of public health and safety.
Fourth, a sustainable green supply chain increases competitiveness. Businesses can compete more effectively if they offer products and services that are safer, cleaner, more environmentally friendly, and more efficient than those offered by competitors.
Sustainable green supply chain management is the way of the future.
Green and sustainable supply chain management concepts will coexist in the future of sustainable supply chain management. Indeed, many businesses have already made sustainability a priority in their supply chains. They may, for example, choose to source products from suppliers who adhere to stringent environmental standards or to manufacture products entirely out of recycled materials.
Why is it critical for businesses in a variety of industries to have a sustainable green supply chain?
The world’s population is growing at a breakneck pace, and is expected to reach 9 billion by 2050. To feed this growing population, food production must increase by 70%. Simultaneously, our planet’s carrying capacity has been exceeded. As a result, we face serious environmental challenges such as water scarcity, land degradation, climate change, air pollution, biodiversity loss, and ocean acidification. These issues affect not only us, but the entire ecosystem as a whole.
Globally connected,
locally invested.