Logisticians focus on environment

The focus was firmly on the environment at the Scala annual logistics debate last month. Companies needed to ask themselves three questions, according to John Perry, managing director of Scala Logistics Consulting. Would they put the environment before cost benefits? Would they collaborate with competitors? Would they reduce customer demand for the benefit of the environment?
“There is a lot of talk at the moment about our responsibilities as businessmen and logisticians towards the environment”, he told delegates at Scala’s annual logistics debate held in association with the CILT. “But is this just a case of senior management PR, or is it really serious this time?”
Chris Robinson, international supply chain manager for Tetley Tea said it was not a case of thinking the unthinkable, but of thinking in terms of the environment, society and the economy – and applying this to all decision making. “We should not be ashamed of saying that we are looking to make a profit,” he said. “But we must act in a responsible way.”
Robinson argued that there has been an artificial demand created for out of season produce and products. “Who, I wonder, demands to buy apples all year round? Who insists on having fresh vegetables of all varieties all year when an attempt to buy a pair of shorts in October or a top coat in April is met with incredulity by some stores? Is this demand created by the consumer – or the retailer?”
He also called for more collaboration across the supply chain. “In the UK today the demand is to supply goods on an as required basis to the various infrastructures established by retailers in the constant search for economy and efficiency. Is this environmentally driven? The opportunities for logistics collaboration are immense and these need to be fostered not imposed. Every organisation will have specific circumstances that might suit closer ties and collaborative approaches but it is not a one size fits all solution”.
He warned of the social impact of changing things too quickly. “The problem we now have is that having provided the service and with suppliers around the world gearing up to meet this demand, to stop could be detrimental to some fragile economies. Already more than one million people in Africa are dependant upon trade supplying fresh fruit and vegetables to Britain. Once again it is a balance that is required, this time between environmental impact and sustainability.”
He said that Tetley had achieved efficiencies in it logistics processes which were environmentally friendly – and beneficial to the company. These included:
* The number of vehicle loads between factory and warehouse was reduced by 28 per cent and density per pallet increased by up to 50 per cent by the introduction of new soft packs.
* Working on ensuring that we minimize our empty running and achieve a yearly utilization of around 80 per cent by carrying return loads for many organisations and specifically collaborating with our suppliers and customers to ensure we had a ‘best fit’ solution.
Terry Murphy, distribution director, Dixons Stores Group International said the company had recently transformed its supply chain – and a side effect was significant environmental benefits. However companies must get the environment and the impact of logistics further up the supply chain and corporate agenda. “We must tackle environmental problems as an industry wide initiative and it is up to the 3PL logistics service providers to seize the initiative.”
Dixons group does many thousands of home deliveries every week and theWEEE Directive has become an issue. “Following a promotion on free white goods collections and recycling we are currently doing 64 per cent of pick ups when we do home deliveries. “This is better than our Norwegian colleagues who were regarded in the group as the green benchmark” Terry said.
Wincanton director Rebecca Jenkins is championing the reduction of the carbon footprint across Wincanton. “There is a sound business case for tackling environmental issues, but there is a lot of hype in what is said,” she told delegates. “The fact is that young people are very concerned and getting more concerned. They no longer want just talk – they expect action now.”
“Consumers will force the issue and that is why companies are looking at long term protection of their brands. Companies like Nike want to show tomorrow’s consumers that they are acting today to protect the environment,” she said. Other examples she gave for companies taking positive action in the supply chain were Wal-Mart, with a balanced environmental score card for suppliers and Sainsbury with the eco friendliest UK DC in Northampton.
“The truth is that no one has all of the answers, and there is a need for a step change now. We must change our thinking now”, she said. “We need to have a culture of trust and share information. Wincanton would be prepared to collaborate in this way with customers and competitors. We could establish a benchmark for environmental KPIs and draw up a programme for targeted action on those KPIs. This would enable us to create a model for tackling environmental issues.”
Wincanton has conducted a full environmental audit and created a strategic plan based on the results. “We recycled 250,000 tonnes of environmental waste and cut fuel by five per cent with safe and efficient driving programme. These are all good things but not enough”
Chris Crean, transport campaigner at Friends of the Earth, said it was time for logisticians to see themselves as part of the solution, not part of the problem. “Where possible we need local sourcing, products and people and you should be thinking think ‘our’ environment – not ‘the’ environment.
“Beware of snake oil salesman who have easy answers and ‘gurus’ who are giving us green spin”, Chris said. “We are at the start of a big journey: One thing which influence everyone tonight is that we are coming to the end of cheap oil.”
“One environmental problem created by the logistics industry is the demand for land for logistics centres. “This will lead to many extended legal battles in the coming years.” Crean said there is a need for more local logistics, operating over shorter distances. “Everyone has said tonight that you must be willing to co-operate with competitors. This is obvious – but will it happen?”
On the role of rail in freight movement Crean said: “The Government should invest more in rail – but even doubling freight capacity would not solve any problems. The rail industry is very good with people but not very good with freight. The problem is that no one in central government takes rail freight seriously. We need a ‘national spatial strategy’ for whole of the UK” he added.