How Companies Can Increase Sustainability in Their Supply Chains

How Can Companies Increase Sustainability in Their Supply Chains?

Running a company can be very complicated. For companies, the triple bottom line framework is essential, especially when to consider sustainability. The triple bottom line considers profit, people and the planet. Going deeper, they measure the financial, social and environmental performances over time. If the numbers are steadily going up, it is a good sign that sustainability is being achieved. To improve the environmental performance numbers, they can do a number of things. One of the most important and effective methods is to increase the sustainability in their supply chain. According to Forrester's Research, there is for elements to focus on in oder to make these goals achievable. 

The first one is procurement. This means that companies should look at their sustainability efforts even deeper. Usually, companies tend to only look at and reduce their water and energy use. Those are both very important, however, they can improve their sustainability by also looking at the materials being used and ensuring they are sustainable or at the very least environmentally friendly. The second element is operations. Companies should always be looking for better and more efficient methods to do their operations. This would be most effective to reduce the amount of usage for their resources. For example, re-using their non biodegradable materials used and converting them to usable raw materials. This creates value because re-using these materials will lead to sales and profits. The third element in Forrester's model is retirement. This element means that companies should reduce their waste as much as possible. This would be achieved by creating and using products that can be reused. The fourth and final element in the model is data and communication. Companies must ALWAYS look at the data. That is the most effective and fool proof method to get evidence and make changes if needed. This element is to be incorporated in every other element in this model because it calls for evaluations of every single one. When the data is analyzed, it is important to communicate the positive outcomes and the negative issues that need to be addressed in order to make these efforts as effective as possible. These elements are used to encourage circular-economy, which is the idea to get rid of pollution and waste out of the products and systems incorporated in the business model for a company. 

What is Reverse Logistics?

Reverse logistics has been acknowledged for a very long time (since the 1970's). This is when companies create integrated systems that use their waste to create usable raw materials. This creates a circular value model which means that the logistics of a company are moving forwards and backwards. The raw materials are used to create value through their sales going forward and then after the products are used or delivered, the waste is re-used going backwards through marketing channels. In every step of the manufacturing and distribution stages, waste is created. Minimizing this will be essential to create a sustainable and environmentally friendly system. 

Companies That Are Using Reverse Logistics:

In 2022, there are much more companies that are incorporating reverse logistics into their business systems and strategies. ShipBob is a top company that uses reverse logistics by partnering with other companies to make their own process to return products. They also work with companies for forward logistics, creating a circular logistics model that reduces waste. Nike also uses reverse logistics every time that anything is returned. They have incorporated their "rebound" operations that reuse the waste of returned materials. The returned items that are deemed as "never-been-worn" are put right back on their shelves or are stocked online for available shipments. The shoes that are returned and used are shredded and reused as raw materials for new shoes. Some shoes that are not in perfect condition are sometimes put on shelves at a reduced price, this is part of their refurbishing program.