With the increase in global transportation volumes, e-commerce, development of new markets and product individualization, the logistics industry is witnessing tremendous growth. However, this growth is ensued by environmental issues, with the logistics industry being one of the major contributors of carbon dioxide emissions.
The subject of global warming and its potential impact on ecosystems is critical today. As the debate on mitigation and adapting to global warming gathers momentum, the logistics players find themselves under close scrutiny. Companies are being held accountable for environmental problems created by their suppliers. The media is also quick to link companies with suppliers who follow environmentally-unfriendly policies, especially if a catastrophe occurs. Hence, most organizations undertake environmental audits to check the actions of their suppliers. Logistics players are in the sphere of impact.
Moreover, there is pressure to reduce costs by reducing the environmental impact of business processes. Re-evaluating a company's supply chain, from purchasing of materials to shipping and distribution of end-products, and implementing green policies can result in savings. This places focus on the logistics players to act.
Green Supply Chain
Customers’ demand for green supply chains across industries, rising fuel prices, regulatory needs require logistics companies to adapt to shifting situations. Logistics players need to look at various greening measures such as improving energy efficiency, emission measurements, modal shifts, green sourcing, strategic placements of distribution centers, warehouses, and others. They need to tap the increased opportunities for consulting across industries.
While there is an increased interest in the adoption of sustainable techniques, the greening of transportation and logistics still remains a vague thought for many. With many factors to consider and little practical information available, some either do not get the right returns or some do not even try.
Pragmatic views from Patrick Cannaugton, Senior Analyst, Forrester Research provide an insight into the initiatives that Logistics Service Providers (LSPs) should consider and how the IT and consulting companies can support their LSPs in these initiatives.
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