More and more people are ordering goods online, be it on marketplaces such as Amazon, Vinted or Etsy, a gift from a designer in Italy or fitness food from a wellness brand. As the online shopping trend grows, this means more vehicles on the road.
A sustainable supply chain in logistics describes the attempt to find environmentally friendly freight transport solutions, in order to reduce the increasing impact on the environment. These include ecological packaging solutions such as packaging reduction, resource-saving transport using biofuels and zero-emission vehicles, a climate-friendly supply chain strategy through shorter routes and the recycling of goods in the circular economy.
Here, you can find out how you can effectively implement a sustainable supply chain through environmentally friendly freight solutions, comply with regulatory standards and which sustainable logistics solutions are particularly important today.
Recap: logistics in sustainability
Sustainability in logistics, also known as green logistics, describes resource-saving merchandise management in order to reduce the impact on the environment. This includes energy-efficient logistics, the reduction of CO₂ and waste, as well as effective lifecycle management of goods.
Sustainability initiatives in the logistics industry intervene in processes, structures, procedures and the planning of merchandise management, to ensure a sustainable supply chain and optimal use of resources.
What initially seems like a big undertaking will pay off in the long run. Many companies are burning more energy, CO₂, and costs than necessary as they respond to ever-increasing customer demand for fast, 24/7 deliveries.
This often leads to empty runs, insufficiently used storage spaces, as well as increased electricity, gasoline and personnel costs. A rethink is needed not only to help ensure sustainable freight transport, but also to make operations more efficient.
Examples of a sustainable supply chain
Optimizing sustainability in the supply chain involves a holistic approach. On the one hand, this includes the reduction of packaging, and on the other hand, a rethinking of supply chain management, sustainable treatment of employees, transparent communication with customers, efficient transport planning and environmentally friendly transport.
1. Resource-saving procurement of goods
Sustainable supply chains start with the procurement of goods. Companies can choose to work with local suppliers to reduce routes and save CO₂. You can also check whether suppliers recycle packaging and avoid plastic.
Customers are paying more and more attention to whether companies can demonstrate a holistic sustainability strategy, which has a positive impact on the brand image.
2. Smart warehousing
Optimizing supply chain sustainability requires optimal use of storage space. With Logistics 4.0 all logistics processes are linked together, so that every step can be seamlessly integrated. This is particularly helpful when optimizing resources in logistics.
For example, electricity can only be used for cooling and lighting when there is a real need. Sensors in the warehouses automatically record temperature and time and switch devices on or off as necessary. In addition, some warehouses are already operated with solar systems, which contributes to energy-efficient logistics.
An automated, digital goods management system also helps to avoid overstocking and to utilize the warehouse effectively. This not only saves time and staff, but also paper.
3. CO2-neutral vehicle fleets
The advantage of a sustainable supply chain is also evident in the vehicle fleet—for example, through driverless vehicles (including zero-emission vehicles) that are used within the warehouse. Green freight transport solutions using solar energy, hydrogen power or biofuels have also proven to be an efficient solution for environmentally friendly transport of goods.
Electric vehicles are particularly suitable for net-zero shipping (net-zero shipping without CO₂ emissions), but so far they can only be used as a sustainable freight transport solution on shorter routes.
Amazon Freight uses e.g. 20 fully electronic Volvo trucks, which move cargo between warehouses. In addition, more than 1,200 electric vehicles are used for emission-free delivery of packages through Amazon Prime, which contributes to decarbonization in logistics.
A sustainable transport company also ensures that its vehicles are utilized as fully as possible in order to reduce traffic emissions. Digital route planning tools can also be used to ensure drivers take routes that will lead to the lowest CO₂ emissions.
If you are not in a hurry to transport freight, you can also switch to rail freight, as container transport by train only produces 0.5% of the CO₂ emitted in the entire freight transport sector.
4. Ecological packaging solutions
The resource-saving use of packaging plays a major role in the sustainability of logistics. Until now, packaging that was far too large for little content was often used, which led to insufficient utilization of the means of transport and produced large amounts of waste.
Amazon shows how it can be done differently. Customers can now choose whether they want to receive goods in the transparent, tailor-made packaging of the goods or whether they need extra packaging from Amazon.
Sustainable packaging in logistics is therefore small, space-saving and, ideally, recyclable. Some companies also offer packaging returns. With Amazon Freight, for example, customers can benefit from the pallet exchange program.
5. Environmental certifications
Sustainable logistics companies can also be certified. BREEM and LEED are internationally recognized certificates that certify green buildings.
There are also ISO 14001 and B Corp certifications, where companies demonstrate how they implement environmental protection in the transportation sector. This is also good preparation for meeting the CSRD guidelines and ESG standards that the legislature requires with the annual balance sheet.
Environmentally certified logistics service providers not only impress their employees, but also customers.
What sustainable logistics solutions are there?
There are many different ways for the logistics industry to implement sustainability. Regardless of whether it is sustainable transport technology for optimal route planning or a CO₂-neutral supply chain, environmental protection in transport is becoming increasingly important. Here are four other trends dominating this year.
1. Circular economy
The circular economy is increasingly playing an important role in logistics. Instead of simply producing and selling products, goods now go back to the retailer after they have been sold in the sustainable supply chain cycle.
This creates new processes, such as recovery, reuse, repair, refurbishing or recycling.
New business areas are opening up here, such as online shops for fashion brands (see H&M) that specialize in the second-hand sale of their goods.
2. Sustainable urban logistics
Sustainable urban logistics is still at the beginning of its development. However, it shows promising model attempts to promote environmentally friendly transport of goods.
These include, for example, the inner-city transport of goods in a net-zero zone exclusively with electric vehicles, delivery via drones, low-noise transport at night, the forwarding of freight from outside the city through underground pipes to microhubs in the center, as well as transportation by cargo bike.
3. Zero-Waste Practices
Zero waste practices go hand in hand with the circular economy. Shippers and consumers will often come across the phrase ‘Reduce, Reuse, and Recycle’, referring to the practices of zero-waste. In logistics, this includes reducing fuel consumption through electromobility, reusing packaging, and recycling packaging and goods.
4. Digital tools to reduce CO₂
In addition to the last three points, digital tools are increasingly being used to optimize route planning, reduce energy costs in buildings and minimize the consumption of paper, for example, through a TMS (Transport Management Software), which can be integrated into the company’s existing ERP software.
Join a sustainable supply chain with Amazon Freight
Amazon Freight offers you freight transportation solutions that work towards building a sustainable supply chain. In addition to digital route optimization, we also offer to reduce CO₂ emissions and intermodal transport services while we meet 98% of our time target for each delivery. Create your free shipper account today, or send us an email at: freight-eu-interest@amazon.com. One of our Account Management team would be happy to offer you any advice or answer your questions.