Are supply chains the key to a greener black Friday?

Choices on Black Friday can be overwhelming. Everything’s on offer, everyone’s got a deal.

I try and limit myself to one item so this year it’s a pair of shoes. There are still decisions to make – style, material, size, colour, lace colour – but it feels more manageable. But the reality is that behind every product, retailers make a dizzying number of choices. And those decisions might be causing series issues for the planet.

One Track Mindset

When it comes to supply chains, the deciding factor is usually speed. No one wants to run out of stock, especially on Black Friday. The problem is that the fastest methods of transport are also the most environmentally damaging. 

74% of consumers care strongly about environmentally responsible supply chains. So how can retailers get the stock they need, on time, while still caring about the planet? 

Sustainability as KPI

Loads of brands talk about putting sustainability at the heart of their business, but what does that really mean? To me, it’s all about using it as a stage one supply chain consideration. That means thinking about it with your other core KPIs like working capital deployment, cost management and revenue. 

And it’s not a big stretch. The ultimate goal of a sustainable supply chain is to produce just the units you need with enough time to move them in an environmentally efficient manner. This aligns with using working capital effectively (small, agile ordering) and cost (low cost modes of transport), just adding emissions as one more factor to consider. 

If you can make supply move in step with demand, you reduce not only emissions, but also stocks outs, inventory and freight spend.

The hard part is getting the data to do it properly. 

Data-Driven Sustainability

Without the right information and measurement, businesses have no opportunity for accountability or improvement. That's as true of sustainability as any other KPI, but most companies lack the experience and resources to measuring it. However, while measuring emissions can be challenging, you can make a big difference just by looking at existing supply chain data. 

A great example is air freight. Moving goods by air is 30x more polluting than ocean freight, so we need to be responsible in how we use it. But is a speed-first supply chain, mindset, whole orders are blanket air freighted, often because just one SKU is in high demand. 

This is a data problem - logistics teams don’t have the layer of visibility and flexibility to move just the products they need. 

By analysing your supply chain at the SKU level, rather than PO level, you can be more targeted. If a product is suddenly in high demand, you can air freight those target SKUs and ocean ship the rest. But achieving this requires up to date supply and demand data and the ability to share it between commercial and logistics teams..

Another example is supplier performance, which has a huge impact on emissions downstream. Time and again, we see supplier delays requiring whole orders to be air freighted to arrive on time. We know most businesses vet their manufacturers for credibility, industrial processes and worker treatment. But how many are looking at how they affect their emissions? 

Taking Practical Steps

There are steps every retailer can take right now. 

I'd recommend consolidation as your easiest target. Start by determining what is an acceptable tolerance for arrival dates variation. Your forwarder should then be able to catch the shipments that you don't need urgently and consolidate them at port or a CFS to reduce container usage, emissions and cost. 

In the long term, building a greener supply chain will require structural changes to your network to balance service, cost and sustainability. 

That could start with locating your warehouses and DCs strategically to limit last-mile emissions or inter-warehouse transfer. We’re also seeing more of our customers embrace near-shoring, to increase their speed of product and delivery, while also reducing transport emissions with shorter supply chains.

The tactics that work will be different for every business, but the point is that it’s no longer a straight choice between sustainability and speed. There’s always a way to balance your green obligations with business priorities, and it could have more wide ranging benefits than you think.

So as you browse the deals this Black Friday, think about what other decisions you’re already making, what other choices you have and where they could take you.