Tying Sustainability Initiatives with Savings and Supply Chain Improvement

Ever since I began to dig into the green and sustainable supply chain world in recent months, I've become a strong believer that such efforts do not have to have a negative impact on a company's bottom line. In fact, they can bolster it. If you're looking for some reasons why, check out Cap Gemini's new study and microsite dedicated to examining "the correlation between sustainability and the future supply chain". If you don't have time to read the full report or the site, you can check out a recent Industry Week synopsis of the research which suggests that emerging supply chain models will take "into account sustainability parameters such as CO2 emissions reduction, reduced energy consumption, better traceability and reduced traffic congestion, as well as traditional measures like on-shelf availability, cost reduction and financial performance."

But cost and sustainability benefits are not mutually exclusive -- quite the contrary in fact. "The study found that the total potential impact of this supply chain redesign is significant, including reduction in transport costs per pallet, reduction of handling costs per pallet, reduction of lead time, lower CO2 emissions per pallet and improved on-shelf availability," Industry Week notes. In addition, I'd suggest based on some research we conducted for an upcoming Spend Matters Perspective on the subject that packaging redesign (e.g., changing from circular shapes to square, moving to flexible plastics, changing resin composition, etc.) can not only help a company achieve Wal-Mart, consumer or regulation-led sustainability initiatives, but can also play a significant role in cost reduction. So perhaps it is easy being green -- and seeing green at the same time.

- Jason Busch

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