Estimates suggest that a business’s supply chain accounts for more than 75 percent of its total greenhouse gas (GHG) emissions. The alarming rate of global warming, coupled with consumer awareness about environmental sustainability, has led companies to build green supply chains that reduce their carbon footprint. For businesses, a reduced carbon footprint can also result in lower operational costs. However, quantifying a business’s carbon footprint across a supply chain is challenging. In addition to following sustainable practices in-house, companies must also convince third-parties such as suppliers and logistics providers to adopt a low carbon regime. Still, a few specific areas offer near-term opportunities for improvements by businesses seeking to build a low carbon supply chain.
Ways to Reduce Carbon Emissions Across Supply Chains
The sustainability of a supply chain varies depending upon the product and processes involved. However, a few common aspects of every supply chain significantly influence overall emissions, and businesses can readily focus on these key areas to build a low carbon supply chain:
The United States generates over 80 million tons of packaging waste every year, with food and beverage packaging contributing to the majority of plastic waste. To reduce the environmental impact of non-recyclable packaging, businesses have started to focus on sustainable and biodegradable packaging materials such as plant-based corrugated wrappers, recycled paperboards, and compostable bags. However, since not all of these innovative packaging materials have been approved by the FDA for food safety and freshness, supply chains handling perishable food products still largely depend on single-use plastics and recyclable bottles and cans for packaging.
Freight transportation, a crucial part of any supply chain, is also a major contributor to air pollution, as it is responsible for more than 50 percent of total nitrogen oxides emissions in the U.S. As supply chains become more complex, freight activity continues to increase, and the associated increases in transportation costs impact a company’s total cost of business (TCOB) across its supply chain. To reduce the number of miles in the supply chain, businesses are shifting from offshoring to nearshoring sourcing strategies. By procuring supplies and moving manufacturing close to end markets, businesses are able to reduce both carbon emissions and distance-driven costs.
Cube utilization in transport can help create a low carbon supply chain. Shipments carrying cubed-out loads increase the cost-effectiveness of each transportation leg and reduce empty miles. However, heavier loads burn more fuel and decrease a truck’s average fuel mileage. Logistics managers are addressing this concern by reducing the overall weight of product packaging and choosing high-quality, lightweight plastic shipping pallets.
Using Plastic Pallets to Create Low Carbon Supply Chain
Shipping pallets, often overlooked in the supply chain, can significantly lower a supply chain’s carbon footprint. While wood pallets are bound for a landfill once their usable lifespan of about 25 trips is exhausted, plastic pallets continue to perform.
The following are some additional advantages of plastic pallets that contribute to a greener supply chain:
- Lighter weight: Plastic pallets are up to 35 percent lighter than conventional wood pallets and reduce the total weight of each freight load, thereby requiring less fuel for transport and lowering transport costs.
- Durability: Compared to stringer pallets or wood block pallets, high-quality plastic pallets can make as many as 100 trips through the supply chain in their lifetime.
- Recyclability: Plastic pallets are 100-percent recyclable and sustainable. Unlike wood pallets that are often dumped in landfills once they are broken or damaged, old plastic pallets can be ground down and turned into “new” pallets.
- Pallet pooling: Pallet pooling offers a circular business model, making it cost- and energy-efficient to procure and manage high-quality plastic pallets.
Innovative packaging, nearshore sourcing strategies, and cube utilization during transport all contribute to lowering carbon emissions in the supply chain. Additionally, these practices can translate to reduced total cost of business (TCOB) while helping to build a low carbon supply chain.
iGPS pallets allow you to save fuel and reduce pollution while lowering the total cost of business (TCOB). To learn more about how our rental pallets can help you build a low carbon supply chain, give our team a call at 1-800-884-0225, email a specialist at [email protected], or visit our contact page.