Logistics plays a big role in the global economy and represents an area with a high carbon footprint. It is estimated that 8% of global CO2 emissions come from logistics operations. The industry is also a major contributor to air pollution. In contrast to many other sectors, freight emissions are still increasing. This clearly shows that changes need to be made. The environmental issues in the world continue to rise and companies must take action. Sustainable supply chain strategies are a priority for many companies and green logistics is a term that has gained momentum in the last couple of years.
Green logistics describes all efforts to measure and minimize the ecological impact of logistics activities. It includes a company’s efforts to implement more sustainable operation processes and lowering their emissions. The main goal with green logistics is to coordinate logistics activities and have them implemented in a way that benefits both the economy, the environment and the society.
As mentioned, the logistics industry is not known for its high degree of sustainability. This is due to several factors such as:
Last-mile deliveries impact urban traffic
Lack of infrastructure
Silo- based systems
The invisibility of logistics to consumers
So how can we solve these challenges and start the journey towards a more sustainable sector? Let’s have a look at which initiatives we can take to achieve green logistics.
1. Leverage technology
Using technology will make your logistics operations more efficient. With digital logistics, such as cloud logistics solutions, you can connect all of your different systems and end the silo-based way of working. You will then have a visibility over your logistics operations that is impossible without digital efforts. It becomes easier to remove wasteful activities which in return will make your supply chain more sustainable. Digital logistics provides full transparency and is the most cost-efficient way to integrate sustainability into your supply chain management.
Going digital is something that needs to be done whether you are working on green logistics or not. Covid-19 has rushed the digital transformation in almost every sector, and digital efforts are now a necessity to stay competitive.
2. Collaboration and load optimization
As a society, we are stronger together. This also applies to logistics. It is a waste of resources to not collaborate with different partners that can make your logistics operations more sustainable. ALICE (Alliance for logistics innovation through collaboration in Europe) has identified “sharing logistics assets” as one of the ways to reduce the carbon footprint from logistics. This way, we can make sure that the load optimization on trucks, containers and trains are used to the maximum capacity. Load consolidation and asset sharing can reduce the number of empty runs, which is a major problem today. This can be done through bundling and cross-docking that are optimized to facilitate load consolidation from different suppliers and shippers. Smaller, but more frequent shipments is an increasing trend in freight transport (due to e-commerce). By sharing assets, we can reduce the number of empty runs by 15-40%, hence reduce freight emissions.
Collaborating with partners in your network will reduce your logistics costs as well. A win-win situation.
3. Route optimization tools
Transportation is a major source of greenhouse gas emissions. Route optimization is a great tool to make sure that your transportation means moves as efficiently as possible when it comes to energy use. Route optimization maps out the smartest route, avoiding traffic, roadblocks and other factors that might cause delays. This will reduce your carbon footprint because the tool will find the foremost effective routes for your deliveries.
Your company will save fuel costs and generate high levels of efficiency that improves overall customer service. Implementing route optimization will therefore benefit both your company and the environment.
There are many reasons why green logistics is gaining momentum. It represents a strategic advantage over your competitors, and it prepares your company for the future. Also, it will reduce your costs. At the same time, you show your customers that you are willing to take responsibility for changing the way you operate, to benefit the environment.
Business as usual is no longer an option. Sustainability initiatives in logistics need to be made so we can contribute to keeping mother earth livable for future generations. And it all starts with a look inside your own company and the right digital tools.