In a marketing and consumption-driven world, where being
green often costs more, the Bentonville, Ark.-based big box retailer broke the
mold by rolling back prices and preconceptions in the interest of both the
environment and economy. It created a business case for sustainability that
permeates all facets of its organization and extends to suppliers and
customers, as well.
Green logistics describes all attempts to measure and
minimize the ecological impact of logistics activities. This includes all
activities of the forward and reverse flows of products, information and
services between the point of origin and the point of consumption. It is the
aim to create a sustainable company value using a balance of economic and
environmental efficiency.
The main objective of Green logistics is to coordinate the
activities within a supply chain in such a way that needs are met at the least
cost to the environment considering factors like climate change, air pollution,
dumping waste (including packaging waste), soil degradation, noise, vibration
and accidents, as illustrated below:
Green or sustainable logistics is concerned with reducing
environmental and other negative impacts associated with the movement of
supplies. Sustainability seeks to ensure that decisions made today do not have
an adverse impact on future generations
Is it really worth
it??
Upon contemplating the various pros and cons of Green
Logistics, I stumbled upon some interesting benefits that would greatly impact
the environment, while at the same time have also posed some big challenges to
companies:
Costs associated with Packaging
Packaging represents one of the greatest challenges to
environmental friendly logistics while at the same time being vital in shipping
and storage. Correct or incorrect packaging has consequences for how much
of a product can be stored, how it is stored and or transported in a given
space. This can increase the unit cost if the packaging hinders optimization of
storage space. Many industries have developed forms of packaging that is used
only once and discarded, especially when it relates individual tins or cartons
of food. It is this type of packaging that presents the greatest challenge
to logisticians as, increasingly, there is a responsibility for the supplier
and the buyer to recover and recycle or effectively dispose of packaging.
Attempts to reduce carbon footprints
The ships, trucks, trains, airplanes, shipping containers,
and warehouses that the logistics function uses to deliver products and
services both locally and globally account for almost 6% of the GHG emissions
generated by human activity. Though there are known logistics strategies that
can significantly reduce CO2 emissions,
a key obstacle to implementing these strategies is that they require
significant internal and external collaboration. The logistics function
supports multiple business activities and related decisions. It’s driven by
client-supplier relationships, outsourcing arrangements, cost-sharing, and
coordination between trading partners. Constantly shifting standards,
relatively complex GHG computations, and differences between the strategic and
tactical objectives of the participants make it easy to appreciate why
logistics is often regarded as a tough environmental nut to crack!
Despite the various challenges, big companies like Walmart
have gone out of their way to adopt Green Logistics and have significantly
incorporated this process. It is without a doubt that this is a boon to the
environment. But the main thing to ponder about here is – Given the significant
costs and collaboration that will be incurred, to what extent are more companies
willing to embrace this process in their supply chain network?
References:
http://en.wikipedia.org/wiki/Green_logistics
http://log.logcluster.org/operational-environment/green-logistics/index.html
http://www.inboundlogistics.com/cms/article/green-logistics-the-walmart-way/
http://www.logisticsmgmt.com/view/why_green_equals_good_business/sustainability
http://sloanreview.mit.edu/article/delivering-on-the-promise-of-green-logistics/
Effective supply chain management strategies is required in order to reduce carbon footprints. Companies like Global4PL, effectively use leading supply chain solutions helping businesses to penetrate new regional markets, optimize their supply chain delivery models, and demonstrate total supply chain costs lower than the competition, which results in reduced carbon emissions.
ReplyDeleteVery nice strategy, Thanks for sharing.
ReplyDeletelogistics management
A well-strategize business is a business leading to success. Though a green logistics calls for greener packaging which means a bit costly than usual, switching to the cleaner move will benefit you in the long plus gaining trust to the community as well as the business owners. Reducing carbon footprints in your trucking service is the start of a good change.
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