Building a Sustainable Supply Chain

Imagine you could unlock ￡1.2 trillion in value and dramatically cut down your environmental footprint. Sounds too good to be true? It’s not.

81% of global consumers say they’re willing to pay more for products with sustainable credentials.

Now, what if I told you that tapping into this demand could boost your operating profits by up to 60%?

Welcome to this edition of Supply Chain Spotlight, where we dive deep into building sustainable supply chains. We’ll explore how industry leaders are turning their operations green, meeting environmental, social, and economic goals, and share practical strategies you can start using today.

Why Sustainability in the Supply Chain Matters

Sustainable supply chains aren't just good for the planet, they're good for business.

They’re resilient, efficient, and ethical, helping to overcome both environmental and social issues in a way that helps you thrive.

This means reducing carbon footprints, conserving resources, and promoting long-term economic growth, rather than just green washing websites!

Strategies for Building a Sustainable Supply Chain

Green Procurement

• Step 1: Find suppliers who meet high environmental standards.
• Step 2: Set and share your green procurement policies with them.
• Step 3: Keep tabs on their performance with regular audits.

Energy Efficiency

• Step 1: Do an energy audit to spot inefficiencies.
• Step 2: Invest in energy-efficient tech and machinery.
• Step 3: Train your team on energy-saving best practices.

Waste Reduction

• Step 1: Conduct a waste audit to identify key waste sources.
• Step 2: Start a recycling and waste segregation program.
• Step 3: Work with partners to create closed-loop systems for reusing materials.

Carbon Footprint Management

• Step 1: Measure your supply chain’s carbon footprint.
• Step 2: Set ambitious targets to cut emissions.
• Step 3: Implement carbon-reduction initiatives, like switching to renewables.

Sustainable Packaging

• Step 1: Assess and switch to eco-friendly packaging materials.
• Step 2: Collaborate with suppliers for innovative packaging solutions.
• Step 3: Educate customers on proper disposal and recycling.

Supplier Collaboration

• Step 1: Set clear sustainability criteria for your suppliers.
• Step 2: Build long-term partnerships to improve sustainability practices together.
• Step 3: Provide training and resources to help suppliers meet your standards.

Technology Integration

• Step 1: Identify areas where Industry 4.0 can enhance efficiency.
• Step 2: Invest in the right technology infrastructure.
• Step 3: Train your team to use these new technologies effectively.

Sustainability Initiatives at Unilever

Unilever, renowned for having one of the best supply chains in the world, is a giant in the consumer goods industry, and they are leading the way in sustainability. Here’s how:

Sustainable Sourcing

Unilever sources 60% of its agricultural raw materials sustainably, ensuring that their suppliers meet strict environmental and social standards.

Waste Reduction

By 2025, Unilever aims to cut the environmental footprint of its products in half, focusing on reducing plastic waste and making all packaging reusable, recyclable, or compostable

Energy Efficiency

They’ve cut CO2 emissions from their factories by 74% since 2015 by investing in renewable energy and boosting efficiency

Water Conservation

They’re also reducing water usage in their manufacturing processes to ensure sustainability in water-scarce regions

These steps haven't only reduced costs and environmental impact, but boosted Unilever’s reputation and customer loyalty.

Quick Tips

Do you do all of these? Maybe you do, maybe you don't, but these are some of the low effort solutions I've seen people implementing that could help you get started!

1. Switch to LED Lighting: Replace old bulbs with energy-efficient LED lights. It’s a quick change that can significantly reduce your energy consumption.
2. Implement Digital Signatures: Reduce paper use by adopting digital signature solutions for contracts and documents.
3. Promote Double-Sided Printing: Set printers to default to double-sided printing to cut paper use in half.
4. Adjust Thermostat Settings: Lower heating by 1-2 degrees in winter and raise cooling by 1-2 degrees in summer to save energy.
5. Encourage Reusable Water Bottles: Provide staff with branded reusable water bottles to cut down on single-use plastic bottles.
6. Conduct a Lights-Off Campaign: Remind employees to turn off lights when leaving rooms. This can be reinforced with stickers or signs.

Beyond Environmental Sustainability

Sustainability isn’t just about being green. It’s about people, community, equity, safety and prosperity too.

It enables us to ensure we are not only making the planet better, but also the lives of those around us, both now and for future generations.

People

Think about your family and how devastated you'd be if they found themselves in slavery.

Fair labour practices and better working conditions are more crucial than ever. Did you know that more than 50 million people live in modern slavery conditions, including in supply chains?

Just as you would move heaven and earth for your own family, we need to invest in fair wages, safe workplaces, and reduce inequality to improve the lives for millions of families.

Community

How often do you think about the community you live in? How often do you have to worry if your child will get education or healthcare?

Building strong relationships with local communities can enhance the social impact of supply chains.

This includes supporting local education, healthcare, and infrastructure projects, which not only benefits the community but also create a positive business environment.

Equity

How would you feel if your child was expelled from school for being unable to keep up in class?

Promoting equity within the supply chain ensures that all partners, especially small and medium-sized enterprises, benefit fairly.

This can be achieved through fair pricing, access to financing, and initiatives to help them build capacity, fostering a more inclusive and sustainable ecosystem.

Safety

Would you be happy at work if you felt you were constantly in danger?

Ensuring the health and safety of workers is paramount. Implementing comprehensive health and safety standards and providing regular training can prevent accidents and improve safety.

This makes for a more productive and motivated workforce.

Prosperity

Everyone is feeling the pinch right now. How would you feel if you had ￡50k in savings?

A resilient supply chain helps you withstand the ups and downs. This means diversifying suppliers, investing in local economies, and driving innovation.

Fair trade practices and economic opportunities ensure long-term prosperity for you and all partners.

Governance

If someone makes a promise to you and they break it, how do you react?

Good governance ensures transparency and ethical behaviour. Regular audits and strong monitoring systems in your supply chain help ensure delivery of the high standards that are promised.

Poll Time!

Let me know in the comments what you think the right answer is!

Q: Which area is seen as the most critical to be addressed first to improve supply chain sustainability?

1. Carbon Footprint: Minimising greenhouse gas emissions through renewable energy, efficient logistics, and sustainable transportation.
2. Labour Practices: Ensure fair wages, safe working conditions, and ethical treatment of workers across the supply chain.
3. Waste Management: Implement practices to reduce, reuse, and recycle materials, and manage waste more effectively.
4. Sustainable Sourcing: Source materials responsibly, prioritising eco-friendly and ethical suppliers.

Thank you for reading this edition of Supply Chain Spotlight.

We're committed to providing you with the latest insights and strategies to help you navigate the complexities of your supply chain!

Mike Sutton

Follow Us: On Time Edge

P.S. I'd love feedback! Let me know what topics you'd like to see covered in future editions.