1) Sustainable logistics is a pressing concern for shippers and retailers today.
The concern we now have for our environment is growing fast, and not a moment too soon either! We see everyday examples that environmental damage and its impact on our lives is not a "distant and distant reality." It's here, it's now. This summer's heatwave in Europe has exposed the harsh reality...again.
We've seen the UK government advise its citizens to work from home due to the heat! Also, many locals have left their jobs to move to colder climates.
In a way, this marks the beginning of “climate refugees” that experts have long been warning us about. Displaced populations due to rising water levels, that is,
"Water refugees" is another looming refugee crisis. If we don't act quickly, other disasters are just around the corner...
The COVID-19 pandemic has increased the number of shipments exponentially. On the other hand, more deliveries would mean more vans, which would mean even more emissions in the last mile.
There are increasing government regulations as well as changes in consumer habits; Measuring your carbon emissions has never been more important. And given the intensity of the vehicle fleet and the resource usage to perform the last mile logistics, this is one of the first areas that logistics and distribution companies should consider.
The vaunted goal of Net Zero. The recently concluded COP27 aimed to bring about a big change by asking governments for commitments. While there is no doubt about important protocols such as the Paris Agreement, heated debates remain as to whether the measures are tough enough.
The World Economic Forum forecasts a 75% increase in supply demand. in the 100 largest cities by 2030. This will increase the number of delivery vehicles on our roads by 35%.
A 30% increase in emissions. And bad traffic!
Disturbingly, surveys show that nearly two-thirds of companies do not see net-zero targets as a top priority in our post-pandemic world. However, surveys have also shown that 50% of businesses also recognize that consumer preferences and awareness are evolving. And if consumers don't see a brand as "green" and do enough to eliminate their carbon footprint, they will abandon those brands.
So why these mixed realities?
3) The challenges of measuring green logistics
An important part of the problem is the lack of clarity about the methods used to measure green initiatives and their impact.
According to studies, only 10% of small and medium-sized companies currently measure their emissions. For the largest companies, this number rises to just 25%.
Given that the logistics and distribution industry is one of the largest emitters of CO2, it has been happily found that almost 60% of major haulers are currently measuring their emissions.
4) Sustainability Legislation: Up the Stake
Companies that have swept Net Zero mandates under the rug had better wake up and smell the coffee: The new law wave is here. Governments and their agencies around the world no longer just talk, they must act.
For example, the EU has already proposed including shipping in the carbon trading market. This would put much more pressure on retailers and transport companies to adopt green operations
A new UK law aiming to cut emissions by 80% by 2035 is already putting pressure on retailers and transport companies
5) Evolution of consumer preferences
About a famous sentence from the hit film "Jurassic Park" from 1994, which reads: " Nature finds a way", one could say, environmental protection has closed. Here the consumer sets the tone.
Consumer requirements have changed rapidly and sustainability is one of the most important purchase arguments for consumers when deciding which to buy brands they should buy.
Over 80% of consumers consider sustainability "important" when shopping About 60% of consumers are willing to switch brands if they see the neglect of carbon emissions see emissions.
Increasingly, investors are now asking their companies to publish data on their supply chain carbon footprint.
However, as mentioned above, this must be the case for Standardization and clarity when measuring CO2 emissions. Shippers and retailers involved in the last mile should feel confident about publishing their sustainability data.
6) Green Logistics: Calculating the Big Picture
Reducing emissions over the last mile would be directly impacted by reducing fuel consumption, for example by switching to electric vehicles.
However, it is not that simple and everyone must understand the full scope of what it takes to measure sustainable logistics. And here lies the most difficult challenge for green logistics: ensuring that indirect emissions are accounted for (minimized, eliminated, or controlled) throughout the supply chain.
The GHG (Greenhouse Gas Protocol) Greenhouse) has several Standards to make it easier to understand divided into Scope 1, 2, and 3. Scope 3 is the most difficult to measure and control and the easiest to overlook. This is because it includes all indirect emissions caused by resources not owned or controlled by the company, but it also includes all indirect impacts that the company has throughout its value chain.
7) Execution - Easier Said Than Done
While the CHG protocol provides useful guidance, executing it is often an extremely difficult exercise. As a result, there is now a growing number of “climate advisors” who are on hand to provide you with advice and assistance. They bring a wealth of strategies, insights, and resources to help you.
The general rule of thumb is that most companies can create the first cut of a sustainable plan within the first 6 months. This also describes areas where more research/data is needed.
The most viable method, experts say, is a fluid plan that evolves as you collect more data and learn through the first steps (even by trial and error) since it's an ever-evolving plan and it's a relatively new field.
For example, food companies that have gone green measure their life cycle consumption across processing, transportation, packaging, ingredients, recipes, end-use, and waste. There are often surprises regarding the CO2 impact of the ingredients. Foods like beef are expected to be high, but others like peppers and rice were higher than expected.
8) Embrace full process automation:
Of course, calculating, managing, and monitoring emissions as an ongoing (critical) activity is quite difficult. and a task that requires a lot of resources!
It is therefore imperative to automate the supply chain and implement specialized fleet management software (especially with a focus on the last mile). These are designed to track every emission unit of your fleet vehicles, drivers, routes, package types (etc.). You can also set "goals" for carbon units while optimizing your delivery logistics.
Other advanced operational software, specifically designed for GHG Protocol reporting, allows companies to monitor and report on their carbon footprint.
This software is so advanced that it can collect hundreds of thousands of data points and calculate your emissions in seconds!
You can split your emissions by activity, process, product, region (etc.). .) to develop their sustainability models and make informed decisions to reduce their carbon footprint.
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