Sustainability and Supply Chain Cost Savings

The headline in the Sunday Review section of The New York Times on October 16^th read – “Where did Global Warming Go?”  According to the article, both the public and the politicians in Washington have lost interest.  While that may be true, from a business and supply chain perspective, sustainability continues to be a priority.  In consumer products, major retailers such as Wal Mart and marketers such as Proctor & Gamble and Unilever continue their emphasis on sustainable products and practices.

 I had the opportunity during September to do two presentations on the subject of sustainability focused on the idea that not only is it the “right” thing to do from an environmental perspective, it can reduce costs as well.  The audiences were very different, one was a group of business owners in the construction industry, the second was the Northern Indiana chapter of the National Association of Purchasing Managers.  Both groups included companies who have already developed some activity aimed at sustainable products or operations.

 The key opportunities for mid-sized companies to save money by becoming more sustainable are usually in these areas:

•  Energy reduction – implementing changes in process or equipment that result in less energy consumption
• Energy cost savings – purchasing natural gas and/or electricity from non-regulated suppliers
• Supply chain efficiencies – improving transportation practices to reduce fuel consumption, reducing the amount of packaging, using products that are greener in content, and reducing waste.

 I am not suggesting that these are the only possibilities, they are just examples.  If you want to know more, there are many industry resources that can help with each and every one.  DC Velocity has been publishing articles on the subject of sustainability regularly.  I do hope that, at some time in the future, both the public and public officials will realize that this is not a topic that can be ignored.  The preponderance of scientific data shows that global warming is real.  What business people recognize is that we can address the issue and save money at the same time.