Green purchasing within supply chain management has become a top priority for many businesses and affects which vendors a business chooses as partners. Today, being a green company means working only–or primarily–with companies who also follow eco-friendly guidelines. Yet it can be difficult to thoroughly vet a third party’s green practices. We’ll talk about some resources that can help guide supply chain managers to vetted sources of green products and services as well as companies that make sustainability a cornerstone of their business model.
Environmentally Preferable Purchasing in the Supply Chain
It’s just not possible for a single supply chain manager to understand every criterion for sustainable business practices. As a result, some organizations have chosen to create basic standards to guide businesses that seek to choose responsible vendors. A good example of this is the EPA’s Environmentally Preferable Purchasing (EPP) Program, created to help federal organizations find vendors and products that conform to high environmental standards.
Vendors with green initiatives may take part in programs to cut back on electricity and fuel usage.
Typically, companies with strong sustainability initiatives have programs focused on more than one of the following categories:
- Recycled material use: Environmentally responsible vendors may offer a product that contains a significant percentage of reused materials or parts. Companies may also use recycled tools and equipment, such as recycled plastic pallets, to run their business. If a significant portion of a business makes use of recycled materials, companies will receive positive marks in this category.
- Waste reduction: Typically, this category includes cutting back on the use of packing materials or switching to reusable options. This strategy also includes take-back provisions, such as programs in which cell phone companies take back handsets and strip them of needed but difficult-to-find resources.
- Energy conservation: Vendors with green initiatives may take part in programs to cut back on electricity and fuel usage by installing solar panels or switching to LED lighting. Resource conservation can also include plans to reduce water use, as when wastewater is reused to irrigate the land.
- Pollution prevention: Any measure taken to reduce carbon emissions typically falls into this category. Companies may also review what toxic substances they use and take steps to minimize usage and disposal.
- Open space conservation: Companies should seek ways to minimize urban sprawl and limit the amount of space needed for operations. In some cases, this might mean working from a series of smaller distribution centers located in hub cities rather than operating out of one massive facility.
- Fossil fuel dependence reduction: Many companies are exploring options in electric and solar-powered vehicles for both the environmental benefits and the cost savings. Fuel costs remain a major expense for any company transporting materials or products. The ability to harness naturally occurring, free energy sources provides a major competitive edge.
Programs like the EPA’s make it easier to identify companies that follow good environmental practices. Lists of suggested vendors as well as recommended specifications, standards, and eco-labels are useful, but they don’t cover every option.
Three Tips for Green Purchasing within Supply Chain Management
Aside from seeking vendors whose products and processes meet certain criteria, purchasing managers can also look into third parties with business models that are–by their very nature–sustainable and green. Simple eco-friendly options are:
- Local vendors: Purchasing goods or raw materials from local suppliers reduces the distance those goods must travel and therefore lessens a company’s overall environmental impact. Transportation is the single biggest generator of greenhouse gas emissions of any part of the supply chain. By using local vendors, supply chain managers can immediately reduce their business’ carbon footprint.
- Sustainable packaging: Sustainable packaging is going mainstream. Even corrugated cardboard boxes are now being designed for repeat use, which can cut back on natural resource waste. Companies are also seeking to package products more efficiently. About 24 million truckloads–and 17 billion kilograms of carbon emissions–would be eliminated every year if companies reduced wasted packaging space. Green purchasing means seeking out companies that offer reusable and efficient packaging options.
- Plastic pallet pooling: Deforestation contributes to greenhouse gas emissions as it reduces the number of trees and other plants available to remove carbon dioxide from the atmosphere. The wood shipping pallets used by many companies to transport their goods are part of the problem of deforestation. Single-use wood stringer pallets that make only one or two trips through the supply chain before ending up in a landfill also contribute to our wasteful “throwaway” culture. High-quality plastic pallets reduce our dependence on valuable natural resources and can be reused dozens of times before they are retired and recycled. Couple these benefits of plastic pallets with a pallet pooling (rental) program that moves pallets efficiently between customers, and switching to plastic pallets can significantly reduce a company’s carbon footprint.
Choosing vendors who meet recognized environmental performance standards is one way to ensure that your supply chain is eco-friendly.
Green purchasing within supply chain management ensures that logistics managers are in control of their impact on the environment even when working with third parties. Choosing vendors who meet recognized environmental performance standards is one way to ensure that your supply chain is sustainable. Another method is to choose companies, such as pallet pooling providers, whose business models are inherently eco-friendly.
iGPS plastic pallets provide an immediate reduction of your business’ carbon footprint, as they’re reusable and 100% recycled. To learn more about our eco-friendly plastic pallets, contact us at 1-866-636-6443, email a specialist at [email protected], or visit our contact page.