Green Supply Chain Management is integrating environment-friendly and innovative strategy while planning the supply chain process. In a standard supply chain process, it has been observed by the economists the rising concern on climate change and growing pressure on the firms to decrease the carbon footprint.
The process and involvement of logistics department in every organization have become an essential part to the economic development for a long time now. According to World Bank report, efficient logistics refer to transport, storage and conveyance of products to the ultimate consumers from the companies at minimal costs. Consequently, the agenda and recent focus of the industries is to minimize the carbon footprint and to adapt the logistics activities that promote more sustainability along with long-term impact reduction schemes.
The impact of logistics on the environment
The term “green logistics” is defined as supply chain management strategies and approaches that reduce the energy and environmental footprint of goods distribution, which emphases on waste management, material handling, packing and transportation. The basic aim of green logistics implementation is to develop and sustain carbon footprint-free environment with the positive effect of balanced energy usage.
In logistics, transporting goods from one place to another has been a major cause of carbon footprint and environmental pollution, even though other activates of logistics also have a considerable impact on environment. Approaches directing at greenhouse gas emission diminution have the challenge of changing this correlation encouraging a less transport intensive lifestyle with no damage to economic development. As the logistics process includes transportation and resources, the whole process also needs some other major activities like inventory management, procurement, warehousing, order fulfillment and distribution.
The green logistics implementation in the companies can help in a positive way which includes enhancing logistics department performance, decreasing industrial contamination, reduction of raw material consumption, less violation of environmental laws and unsustainability through adapting natural resources to make goods and deliver services.
According to ISO 14000 standards, it provides a guideline for the company that it needs to improve and systematize its environmental management efforts. In addition, supply chain management and green supply chain can help other companies and industries to reduce their carbon foot-printing and to attain sustainability through adopting some simple techniques in their daily pursuing of activities. Some of these methods include reducing carbon dioxide emissions, reduction of burning oil, coal and gases and less deforestation. Along with all these methods, some other approaches can be adopted including reducing of energy usage, reduce waste and improve efficiencies, conserve natural resources, reduce – reuse – recycle, promote clean, sustainable resource utilization.
How can companies enable Green Logistics?
Green logistics has a significant role in the trade process, transport and deliver the goods. The whole world is concerned about carbon dioxide emission in the transference of goods from one place to another. In the past, many transportation sectors used fossil fuels to produce and make products from energy sources including electric energy, wind energy and solar energy usage. Still, to the large extent, transport sector depends on non-renewable fuel sources along with the gases that emit carbon dioxide. So as per the experts, green logistics can be enabled in the companies by following purchasing process activities, production process, warehouse management, transportation management and EMS.
Purchasing process: This involves improvement of trade facilities such as associating information technology in business to business (B2B business) and system selling through e-commerce or internet means a decrease of the paperwork and receiving of documents. Adopting sustainable purchasing can help to reduce waste, save money, enhance competitiveness and construct a firm's reputation.
Production process: Firms needs to train employees in the logistics department in order to give education about reducing energy usage. The quality of production must be kept intact; waste production should be reduced while making goods; water should be reused as much as possible and emission of harmful gases should be banned.
Warehouse management process: This involves the activities such as moving of products to warehouses, recycled packaging, tramp transporting goods and to reduce folk lift usage along with the use of reducing double handling with an aim to reduce energy and fuel usage.
Transportation Process: The process of distribution involves many ways: road transportation, through rail, by air, or through water transport means. Firms can select environment-friendly means to send couriers through rail or by using less road transportation etc. All these methods can help the management to keep the environment clean and to reduce carbon footprint. With advance Logistics Optimization System like Abivin vRoute, companies can reduce the number of vehicle needed for delivery, thus reduce carbon foot print. By incorporating the system with telematics devices, companies can track can metrics like time on the road, fuel level, emission,... to further control their green logistics effort.
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Environmental Management Systems (EMS): The two major standards ISO 14001:2004 and ISO 14004:2004 offers the needs for an EMS and suggests common EMS guidelines. Firms can reduce carbon emissions by implementing EMS during the entire supply chain. The major activities will be labelling, performance evaluation, life cycle analysis, communication and auditing.
In a nutshell, green logistics is particularly about all the actions that involve minimizing and measuring the environmental impact of supply chain activities. Firms should choose the right logistics and supply chain strategy which is in line with its business policy and goals. The strategy should be applied as per cost, income, available technology, the positive or negative influence on the environment and on all the participants in the supply chain. Green logistics should be adopted in a way as to reduce the carbon footprint and to operate the supply chain without interrupting the needs of the firm and the end-users.