How To Cut Cost And Scale Business Through Green Logistics?

In modern times, shoppers and customers have become environmentally conscious and prefer brands that are sustainable. This is the reason why businesses are going green to impress the people. With increasing focus on environmental issues, businesses have felt the need to go green and this holds true for the logistic sector and therefore, the concept of green logistics has emerged. In simple words, green logistics simply refers to the logistics that have ensured business practices that are sustainable in nature. Green logistics are also known as eco-logistics. The traditional aim of the logistic sector is to focus on operations. However, green logistics in addition to operations also focuses on sustainability. For instance, BlueDart while managing its operations focuses on disaster management, education and climate protection. In its GoGreen campaign, BlueDart has planted trees and has contributed to Earth hour.

How To Scale-Up Through Green Logistics?

Green has been a go-to phrase for many businesses to show their commitment towards the environment and the logistic sector is no different. According to reports by the International Energy Association, the transport sector contributes to a quarter of global carbon dioxide emissions and the logistic sector, of course, is involved with the transport sector. Even though one might assume that the potential of the logistic sector to go green is limited to the transport sector, it is not true. Green logistics also focuses on packaging, material handling, disposal, distribution and warehousing. Here is how logistic companies like Ekart and Delhivery can further boost their efficiency by implementing green logistics.

1. Inventory should be smartly located

Even though the smart location of inventory might look very basic, it is not basic. Location of the inventory if smartly located can prove to be extremely sustainable and further, it will improve the efficiency and productivity of the employees by ensuring that not much effort is required for completing a task.

2. Use energy management systems

For lowering the consumption of energy, it is important to manage it and one way of doing it without much human intervention is through energy management systems. Energy management systems ensure proper integration of thermostats, timers, gas, heat and electricity while ensuring that not much waste is generated. For creating an eco-friendly system, having an energy management system is important.

3. Ethical sourcing

Ethical sourcing refers to the methods of sourcing where the companies ensure that the workers are not only treated fairly but also that the impact of the company on the environment is minimized. Ethical sourcing means different things to different brands. For instance, for few brands, it means to treat their workers fairly while for the other it means to use sustainable products.

4. Streamline warehousing

Using sustainable strategies to operate the warehouses can lower the energy usage of the warehouse drastically. One way to streamline warehousing is to ensure that solar or wind or other green energy sources are used to power the warehouse. Switching to a green energy source also helps in lowering the carbon footprint.

5. Transportation Optimization

Transportation can be optimized by using sustainable vehicles. However, it might not be possible for all the logistic companies to invest in sustainable vehicles. Another way of optimizing transportation is through route optimization. Even with energy-efficient vehicles, it is important to focus on route optimization. Better communication can achieve further efficiency, drivers should be encouraged to perform speed test of their mobile network for better route management and navigation.

How Green Logistics Can Help To Cut Costs?

For any company, mostly going green and cutting costs goes together. It is because going green ensures that efficiency is boosted and the waste generation is reduced. For instance, companies like Amazon and Google have cut their energy cost by 10% by switching to green energy supply sources. Amazon has been working on Amazon Air services to compete with other cargo services such as UnitedWiFi and AlaskaWiFi. Further, the logistic sector can easily practice reducing, reusing and recycling their products.

With the price of raw materials increasing, including the packaging materials, implementing the 3Rs can help the logistic sector to cut down the cost significantly. For instance, Hewlett Packard saved a lot of money and further reduced its carbon footprint by 20% by making changes in its packaging practices. By practicing such sustainable practices, it becomes possible to care for the environment while ensuring that the company benefits by reducing cost and further, it helps the brand in winning the trust of its customers who are generally becoming environment conscious day by day.