Green supply chain management – GSCM – integrates environmentally sustainable practices throughout the supply chain. It includes the design, production, delivery, and disposal of goods.
“Green” is a common term for eco-friendly strategies and initiatives to minimize adverse environmental impacts. Both production and distribution of goods cover many activities leading to these potential negative impacts, and GSCM can be considered an approach focused on reducing the carbon footprint of the supply chain process.
How does GSCM improve the sustainability of the supply chain?
GSCM considerations start at the very beginning, with the sourcing of raw materials, and follow through to product disposal. Approaches focus on:
- Reducing waste.
- Conserving natural resources.
- Promoting environmental responsibility.
- Encouraging collaboration and coordination among suppliers, manufacturers, distributors, retailers, and customers.
Benefits beyond environmental impact
In addition to obvious benefits to our environment, GSCM best practices can also lead to the following:
- Cost savings.
- Increased efficiency.
- Improved reputation for the companies choosing to implement them.
Best practices and strategies
GSCM takes into consideration many vital practices and strategies, including:
Selecting environmentally friendly suppliers and materials can also lead to cost savings. Time invested in testing new materials to be sure they meet safety and performance requirements pays off in the future.
Changing to more streamlined packaging using fewer materials reduces waste and can also cut costs. A more efficient packaging design could enable shipping more items using the same cargo space, lowering transportation costs and reducing carbon footprint.
Reusing waste or byproducts
Companies can get creative about repurposing what they would otherwise throw away. Have you ever walked into a coffee shop and seen the offering of used coffee grounds for customers to take home and use as garden fertilizer? In manufacturing, it may be possible to salvage excess materials or broken products and reuse them to make new goods.
Technology offers many opportunities to streamline the manufacturing process. Tiny changes that boost efficiency and throughput could save energy and cost. Small boosts in team productivity may reduce operating time for some pieces of equipment, lowering overall energy usage.
Streamlining the transportation process offers new opportunities to save money and reduce the carbon footprint. Rethinking the use of cargo space could reduce the number of trips required, and rethinking packaging can help. Planning to allow more energy-efficient transport could improve the bottom line. For example, shipping via ocean freight may be more environmentally friendly than air freight.
Implementing GSCM can improve a company’s public image and lead to marketing advantages
Many consumers value the effort companies put into “going green.” They appreciate that companies care about:
- Actively preserving our planet for future generations.
- Reducing emissions that impact air quality.
- Providing a more healthful work environment for their employees.
Despite high inflation pressure, one recent study found that 66 percent of US consumers and 80 percent of young US adults (ages 18-34) surveyed are willing to pay more for sustainable products versus less sustainable competitors. Adopting GSCM practices can help ensure companies stay at the forefront of positive change.
Improving supplier performance is a collaborative process
Thurman Co. is uniquely positioned to assist organizations in various aspects of Supplier Management, including identifying opportunities to incorporate GSCM best practices.
We help businesses manage projects to significantly impact their success and growth. When you’re ready to put your project in the hands of a trusted professional organization, contact us to learn more about working together.