How To Be Green

Aug 23, 2007 12:35 AM  By

The following article is based on a white paper from RedPrairie, a supply chain services provider.

It’s not easy being green, Kermit the Frog once mused. Or is it? It may be less of a hassle than you think.

Here are six steps you can take to ensure that your firm is both profitable and environmentally responsible. Each one can make a dramatic difference.

1. Optimize Your Routing and Consolidation. Inefficient planning and routing of transportation units and fleet operations can lead to enormous amounts of wasted fuel—and time. Good routing and consolidation can provide the best possible path and that ensure your drivers spend as little time as possible at each stop. They can also maximize the usage of each trailer load shipped, resulting in fewer loads overall.

The result? A direct reduction of carbon dioxide emissions. According to Environmental Protection Agency estimates, every gallon of diesel consumed creates 22.2 pounds of carbon dioxide (CO2) emissions. If every driver in a fleet of 50 trucks drove 5 fewer miles a day through optimized routing and planning, after one year it would save 1.5 million pounds of CO2 from entering the atmosphere—not to mention substantially reducing fuel consumption and fuel costs. In addition, optimized routing reduces idling time, and better consolidation of shipments cuts loading and unloading times.

2. Improve Your Fleet Management. Better fleet tracking allows for more efficient management of resources and reduces the overall amount of diesel fuel consumed. According to the EPA, truck and rail transportation consumes 35 billion gallons of fuel a year, producing 350 metric tons of carbon dioxide emissions.

Some of the greatest environmental benefits from fleet tracking come from the reduction in idling time and improved equipment use. Approximately 15 states and dozens of county governments have proposed laws to restrict the amount of time a vehicle can idle its main engine. Reduce your idling, and you will realize significant legal, financial, and environmental benefits.

In addition, tracking can help you determine an improved fleet strategy—helping you better plan your equipment purchases and usage. One marketer cut 83,000 gallons of diesel fuel and half-million miles by switching from single trailers to tandem trailers at its distribution center. The tractors also have computer controls that limit cruising speeds to 65 mph, and automatically turn off engines after five minutes of idling.

3. Increase Your Global Transport Efficiency. Delays due to port clearance documentation, poor duty payment coordination, or general lack of visibility into your global supply chain can create significant inefficiencies across your operations. With an increasing number of materials being shipped from Asia and Latin America, the overall environmental impact of those shipments can be reduced through better, more efficient coordination and tracking. When goods are stuck in ports or in customs, most companies worry about the sales impact. However, there is also an environmental impact that results from the storage and inefficient movement of those goods.

Gaining clear visibility into the movement of goods allows you to optimize routes and modes of transport around each final destination—for example using large capacity containers for unloading in ports near areas of high demand, and smaller containers for cities with lower demand. This type of optimized international multi-modal transport can exert a smaller impact on the environment by increasing transportation efficiency.

Most warehouses still rely on paper-based methods of communication. However, electronic interfaces, RFID, voice-based technologies, and electronic Advanced Ship Notices (ASNs) can significantly reduce the need for paper in the warehouse. In addition to reducing paper consumption, system-generated tasks, and specifically ASNs, make receiving more efficient—which in turn impacts the overall efficiency of trucks and warehouse personnel.

Roughly 170 trees are destroyed for every 500,000 pieces of paper at postcard weight This doesn’t include the carbon dioxide emissions and greenhouse gases generated in the production of the paper. Cutting unnecessary paper use from your warehouses can generate a quick “green” return on investment.

4. Improve Your Packaging Strategies. There is an increased global focus on reducing the impact of packaging on waste systems and landfills. However, there are also additional steps that can be taken within the supply chain to ensure that reduced packaging, storage containers and transportation supplies are used as efficiently as possible. While many companies are transitioning to reduced packaging materials, some do not reconfigure their shelving to take full advantage of those gains. Our warehouse management solutions can help you streamline storage and accurately track crates and pallets so transportation materials can be more easily recycled and reused.

In Europe, manufacturers are required by the European Union’s Packaging Waste Directive to pay for collection and recycling of packaging waste based on the material and weight of their packages. In the United States, many retailers and some states have established packaging material mandates.

One of the most famous companies mandating packaging changes is Wal-Mart. The firm’s “packaging scorecard” is a measurement tool that allows suppliers to evaluate their packaging against all the other packaging in a product segment. Scores are calculated based on the following weights: 15% for greenhouse gas/carbon dioxide generation per ton of production; 15% for material value; 15% for product/package ratio; 15% for container cube utilization; 10% for transportation; 10% for recycled content; 10% for recovery value; 5% for renewable energy; and 5% for innovation.

Packages that score well on one criterion may not rate as high in another, indicating an area of potential improvement. Since each package is compared with its peers, a ranking can change if another supplier improves its packaging. Last year, Wal-Mart’s Canadian operation switched several shipping crates from cardboard to plastic, allowing them to be reused about 60 times on average, as opposed to the single-use cardboard design. The company estimates it saved $4.5 million from the switch, reduced waste by 1,400 tons, and reduced carbon emissions by 10,000 tons due to the elimination of cardboard production. The Canadian initiative is now being replicated in other Wal-Mart operations around the world

5. Deliver on Energy Conservation Strategies in Your Warehouses. There are a variety of ways to increase energy-efficiency and reduce the environmental impact of warehouses—from energy-saving motion sensors for lights, to solar power and reusable pallets. In the U.S. alone, more than 2 billion wooden pallets are used every year, the equivalent of approximately 1 million acres of hardwood forest. Even small changes such as switching to reusable pallets and creating more efficient shelving or forklift routing can have a significant impact on the overall environmental footprint of a warehouse.

Based on EPA estimates, the average energy cost per square foot for a non-refrigerated warehouse is approximately $1.00, and the average energy cost per square foot for a refrigerated warehouse is $1.45. Running a more energy-efficient warehouse provides the opportunity to cut those costs down significantly and allows you to rely less on non-sustainable energy resources.

6. Do a Better Job of Managing Your Labor. By combining the schedule, time clock, task list, online courseware, and performance metrics into a single touch screen user interface that’s role-specific, your employees can do more, use less paper, and see instant results. These tools also allow store and warehouse management to improve how they manage and schedule people.

In 2005, the U.S. Census Bureau reported that Americans spend more than 100 hours a year commuting to work. Making sure your facilities are staffed correctly can eliminate unnecessary trips by employees, reducing the overall fuel consumption needed to get your employees to and from work. More importantly, improved labor automation and training tools can make your people more efficient, requiring less overtime. Also, with improved labor efficiency you have the opportunity to give your employees paid time off for training or volunteering.