9 Tips To Make Your Supply Chain More Sustainable
Sustainability is not a competitive advantage anymore, it’s a must have in the company. Fear of reduced revenues and profits is the main reason for resistance to supply chain sustainability efforts. So, for that reason alone, our tip won’t be “just turn the lights off on the premises”. If you need to change the approach, you need to go big. This way it not only can cut costs, but even increase revenues.
For example, if a solution means you can ship more in a single container or the packaging is lighter. That means you reduce your costs. If more customers buy your products or pay more money for your products because it has a certified sustainability seal on the packaging, your revenues increase.
We’ll explore a few of these exciting new sustainable solutions that will help your bottom line.
1. Ways To Make the Manufacturing Process More Sustainable
One way to cut costs is to use green energy sources such as sun and wind to power factories and warehouses. With these energy sources, instead of paying a utility company to burn fuel for your electricity, you only capitalize the costs over the life of the solar panels or wind turbines plus the maintenance expense. You never have to pay for the burning of fuel. The sun and wind are free assets.
Solar/wind go naturally with Battery Energy Storage Systems (BESS). With a BESS, you can store green energy for when the sun isn’t shining or the wind’s not blowing. But you can do even more. You can also buy power from utility companies and store it in your BESS. That means you can buy power in off-peak hours at a lower price and use it during peak hours when you would have to pay a higher price.
If your BESS is full, but the sun is shining or the wind is blowing, you can sell any excess energy. If the cost-benefit analysis shows green energy and BESS is a suitable solution for your company, it’s missing an opportunity to cut utility costs.
2. Ways To Make Agricultural Processes More Sustainable
Agriculture requires different sustainable solutions than manufacturing, food processing, or warehouses. Except in rare circumstances, you don’t need to heat or cool a farm. One exception is citrus growers warming trees in Florida to prevent losses when there’s unusually cold weather. Another exception is for indoor agriculture, such as vertical farming.
There are many innovative technologies farmers can use to increase their sustainability. Ecorobotix is a company that produces a smart sprayer that attaches to tractors. Its ultra-precise spraying substantially reduces farmers’ use of herbicides, pesticides, fungicides, and fertilizers. It reduces herbicide use by 91%.
Naio Technologies produces fully autonomous robots for weeding vegetable crops and vineyards. These electric robots reduce the need for herbicides. Of course, with any robotic solution, a cost-benefit analysis is necessary. In some situations, you can significantly reduce the cost of robots by using robots-as-a-services (RAAS).
Data loggers that continuously feed data to advanced data analytics programs can ensure farmers can produce the most with the least inputs. These are among the cheapest solutions to add to your farm’s sustainability.
3. Look for Recycled or Sustainable Materials
Whatever your company produces, there’s usually recycled material available. Until the 1980s, the largest American steel company was U.S. Steel. Today, Nucor Steel produces more steel and has more employees than U.S. Steel. U.S. Steel produces steel from iron ore. Nucor Steel’s primary raw material is scrap metal. Forty years ago, a small company’s gamble on recycling turned it into America’s largest steel producer.
Using recycled raw materials is not only a sustainable solution, but it can also give your company a competitive advantage. It’s just another example of how sustainability can reduce costs and increase profits.
4. Make your Packaging Greener
Packaging and shipping have the greatest effect on carbon emissions for many agricultural products. By curbing the use of toxic materials in packaging, you can help the environment. Many companies are working on sustainable solutions to these problems. Some solutions include:
- Replacing glass bottles with combinations of paper and plastic that use much less plastic than plastic bottles
- Replacing glass bottles with recycled plastic bottles
- Redesigning food packages so you can fit more products on a pallet to reduce shipping costs by reducing the number of shipments
- Compostable and biodegradable packaging
Fragile packaging like glass causes a lot of supply chain losses. Bottles get tossed around on trucks, planes, trains, and ships. Breakage is always a concern. Some fragile products like wine are especially susceptible to risks from glass bottles used for shipping. Glass is an energy-intensive product. The great majority of the energy used to produce glass is from fossil fuels. The above solutions eliminate glass packaging and keep plastic use to a minimum. By not being as fragile as glass, these solutions eliminate a lot of waste.
5. Reduce Waste With Manufacturing and Agricultural Processes
Have you ever considered turning your waste into a revenue-producing product? There are many ways to do this. For example, if you’re a steel warehouse, you may sell your scrap to Nucor Steel. In this example, you buy your steel direct from the mills. The mill only sells one-inch square tubing in 20-foot lengths. You have a customer that wants you to cut their tubing to 16-foot lengths.
You may have thousands of four-foot tubings you can sell to Nucor as scrap. But you might get more money by selling these odd-sized lots to wrought iron shops. You have the salespeople make a few phone calls and you sell this tubing for five times what Nucor would have paid. You just repurposed your waste into a new product and you made a profit, or at least substantially reduced your waste costs.
There are several examples of how this sustainable solution can also be profitable, including:
- Manufacturers can make a new product from the waste created during the production of their products
- A farmer who sells their ugly vegetables to companies like Imperfect Foods instead of letting the food go to waste
- An online retailer that sells its excess computing capacity to other businesses
The last item on the list comes from the story of how Amazon used its excess computing capacity to create Amazon Web Services (AWS), one of the largest cloud computer providers in the world.
For smaller manufacturers that focus on more customized products, one sustainable solution is an additive manufacturing (industrial 3D printing). Conventional manufacturing is subtractive because you cut away from the raw materials to produce the product.
With additive manufacturing, you add layer upon layer until you have a finished product. This leaves very little waste. But it isn’t as fast as a cookie-cutter-type assembly lines. That’s why it’s still limited to more customized products. Don’t confuse these industrial printers with consumer models. These printers can print:
6. Change Suppliers if Necessary To Meet Your Goals
Changing suppliers is a slow process. You can’t just stop using a supplier because they won’t meet your sustainability goals. That might be too big a disruption to your company. But you can shop around and slowly transition to new suppliers following sustainable practices.
How could this effort help your bottom line? We’ll get to that in the section below on certifications.
To get coveted sustainability certifications, your suppliers will also need to follow sustainable practices. They may have promised you they’ll support your sustainability goals, but are they doing it? It matters since sustainability organizations audit your company to ensure you’re following sustainable practices. One factor they will consider is your supply chain.
One way to assess your risk of suppliers not following sustainable practices is to use the Thesis Product Finder database. You can quickly use its database to find sustainability information on thousands of product. If necessary, go visit the supplier to see how their sustainability practices are working.
7. Increase the Size of Your Shipments
As paradoxal as it sounds, you can reduce your costs by increasing the size of your shipments. Packaging that allows you to get more onto a pallet helps with this. For example, a wine bottling company that changed from round bottles to flat bottles can get 91% more product on a pallet.
Wine importers are switching from transporting bottles on container ships to giant bladders of wine held in the containers. These bladders allow companies to ship over three times as much wine per container as they can with bottles. Vendors transfer the wine in the bladders to bottles closer to its final destination.
These solutions save companies a lot of money. But they also reduce their carbon footprint since shipping companies don’t need to make as many trips to transport the same amount of wine. If every company in every industry did this, they would substantially reduce emissions from global shipping.
8. Decrease Waste During Transportation
You can reduce breakage and spoilage during transportation. You may even eliminate it. But there are many variables to consider. In the cold chain, temperature, humidity, light, tilt of the packages, shocks, and vibrations are all factors that can lead to spoilage. For any fragile product, shocks can damage the product. You need to measure these variables at each location in your supply chain to know where to make changes.
Logmore’s data loggers measure:
These high memory long battery life loggers measure all this for you. You can increase your supply chain’s visibility and make educated choices about the transport. And you don’t have to worry about expensive infrastructure or radio signal blockages like other data loggers. All you need is to aim a smartphone at these loggers and the phone reads the data and automatically transfers it to the cloud.
9. Get Sustainability Certifications
Why would any company care if one of these agencies certifies its products as sustainable? The reason is simple. You can put these certifications on the retail packages. Consumers will spend more on sustainable products. So, these certifications increase your revenue per package and your overall revenue.
What did you have to do to increase your revenue? You implemented several sustainability practices that were actually cost-saving measures. When costs decrease and revenues increase, only one thing can happen — profits increase. Increased profits are how you win that game known as commerce.
So, the sustainability is one of the main supply chain challenges right now, and many companies already figured out how to overcome it.
There’s no room for hesitation, when it comes to the future of the planet. And Iot can help you to reduce costly losses by monitoring your products while in transit. Book your demo with us today to see how we can help you.