The call for sustainable shipping is getting real.
The transportation sector is the largest U.S. contributor to greenhouse gas, accounting for 29% of emissions, according to the EPA. As ecommerce has seen a 20-fold increase in sales between 2000 and 2019, with expansion only continuing and last-mile delivery growing, it’s responsible for a sizable chunk of those emissions.
Pressure is coming from all sides for companies to adopt more sustainable shipping practices. Ninety-eight percent of businesses say acting on environmental, social and corporate governance (ESG) issues is more important or much more important than it was 12 months ago, according to research from Barkley and Jefferies. Likewise, 66% of consumers say they’re more likely to support a company if they provide proof of their socially and environmentally responsible behavior.
Recent challenges have added fuel to the fire, bringing the supply chain out of the shadows and onto front page news, helping accelerate sustainability initiatives. According to MIT, 83% of surveyed executives said COVID-19 has either accelerated sustainable supply chain activity or at least increased awareness and brought urgency.
For shippers worried about the pressure to green up their shipping operations, and the associated costs and resources required, there’s good news. It’s not only the right thing to do for the earth but can be good for your business as well.
Here actions you can take now to improve your sustainable shipping.
Work Toward a Sustainable Shipping Certification
The EPA’s SmartWay program is the gold standard for shippers seeking to become more sustainable by helping them measure, benchmark and improve efficiency. Launched in 2004, this voluntary public-private program gives shippers a comprehensive system for tracking, documenting and sharing information about fuel use and freight emissions across supply chains.
Shippers that become SmartWay certified can use it to show customers, investors and employees their commitment to creating more sustainable shipping. It’s supported by major transportation industry associations, environmental groups, state and local governments, international agencies and corporations.
Maximize Local Fulfillment
Thanks to pandemic-related consumer behavior changes, last mile delivery has become more sustainable and efficient. Greater parcel drop density, as well as local fulfillment options like ship from store and curbside pickup, can lower last mile emissions between 17% and 26% through 2025, according to Accenture.
Improving your distribution network so that you’re shipping as much product from as close as possible can lower your shipping costs and speed up delivery times, helping better meet customer expectations for same-day/next-day shipping.
To determine how much you can reduce your carbon footprint by adding more local fulfillment centers, use your historical shipping data. Analyze the average fuel surcharges and miles per shipment to determine your carbon footprint and spot opportunities to optimize your network and reduce it.
Reduce Packaging Waste
The growth of ecommerce isn’t only an emissions problem—it’s a waste problem. The demand for corrugated boxes has increased 9% year over year, and it’s estimated that the demand for filled-air packaging products will increase by $1.16 billion by 2024, according to the Fibre Box Association and Technavrio, respectively. To meet this new demand, 3 billion trees are being pulped every year to produce 241 million tons of shipping cartons, cardboard mailers, void-fill wrappers, and other paper-based packaging, according to Canopy.
One way to significantly reduce packaging waste is by eliminating excessive packaging. Excessive packaging is one of consumers’ biggest pet peeves about online shopping. Almost a fifth of customers say excessive packaging negatively impacts the brand experience, according to a survey by Shorr Packaging.
You can prevent over-packaging by using box sizes that adequately fit the product. Make sure you have a variety of package sizes on hand so you can always pack products in the most appropriate box.
To help estimate what box sizes and what quantity will be needed, use software to model optimal box sizes. Now that the dimensional weight (DIM) is being used to calculate shipping rates, it’s also usually cheaper to send out the smallest possible package. Moreover, the Additional Handling – Dimension surcharge kicks in when packages exceed specific height and width parameters. Keeping box sizes as small as possible will help you eliminate waste and avoid extra shipping surcharges.
To reduce waste even further, use biodegradable packaging and minimize the use of plastics. Some companies are using biodegraded materials like recycled molded pulp in place of expanded polystyrene foam and plastic.
Harness the Power of Data and Analytics
Data is at the heart of any sustainability effort. However, you’re probably not using your data as effectively as you could be. According to Sheri Hinish, sustainability lead at IBM, 95% of supply chain leaders say they can’t map their data.
Look for a solution that can model optimal package sizes, calculate mileage and fuel usage, and use historical data to understand shipping patterns and footprint, creating a distribution network optimized to ship more locally.
Take Steps Toward a Sustainable Last Mile
The shipping industry is at a tipping point. Sustainable change is both necessary and inevitable. Shippers who take a proactive approach will reap the benefits of faster and cheaper shipping and gain a competitive advantage.
Save the earth – and keep your business competitive – by investing in more sustainable shipping practices.
Ami Bensman is CMO/CXO at Sifted