Tuesday, October 18, 2011

Sustainable Supply Chains are Profitable

Sustainable supply chains frequently translate to profitable supply chains. There is growing interest in sustainable supply chains that serve environmental and economic objectives. Growing consumer pressure for eco-friendly products are driving sustainable supply chains with smaller footprints. Sustainable supply chains also reduce costs through improvements in efficiency.

Sustainable supply chains involve procurement that maximizes net benefits for companies and the wider world. These companies incorporate extrinsic cost considerations into decisions alongside the conventional procurement criteria of price and quality. These environmental, economic and social consideration are also known as the “triple baseline”.

Dave Meyer, Sustainable Economic and Environmental Development Solutions (SEEDS) Global Alliance (Northwest Operations) and SVP of Greenbridge International, LLC., told a gathering of logistics and supply chain professionals that there is a bottom line angle to towing the green line.

Environmental, risk, and waste costs make supply chain sustainability a profitability issue.Sustainability in the supply chain is increasingly seen among high-level executives as essential to delivering long-term profitability and has replaced monetary cost, value, and speed as the dominant topic of discussion among purchasing and supply professionals.

Organizations are looking at supply chain sustainability as a new measure of profitable logistics management. One powerful tool to increase efficiency comes from integrating functional activities through information technology that reduce associated costs.

Green procurement is not only a tool with which to address climate change, but it offers the broader capacity to mitigate over-exploitation of any and all scarce resources.

Better methods of defining supply chain sustainability and benchmarking are making it easier to implement sustainable action plans. Companies increasingly recognize significant cost savings through green operations that include a more sustainable supply chain.

© 2011, Richard Matthews. All rights reserved.

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