Manufacturers have been investing an incredible amount of time, energy and money into new sustainable technology and business practices in recent years. The hopes of cutting energy costs, and the ability to increase profit margins, are extremely attractive to businesses of all kinds. However, many fear the initial investment could up-end their entire business. But now, becoming a sustainable manufacturer does not need to break the bank. Here are some ways a manufacturer can work with their supply chain to increase their sustainability efforts as well easily implementable concepts to help improve the sustainability of any manufacturing organization.
A manufacturer can only be as sustainable as their supply chain. A vendor that doesn’t practice any sustainable methods could be doing more harm to the environment than a sustainable manufacturer does good. If a “sustainable” manufacturer sources their materials and resources from an environmentally damaging supplier, their sustainability efforts can be negated.
To ensure a manufacturing operation is truly a sustainable business or at least as close as possible, it is vital to work closely with all the links throughout a supply chain. Communication between manufacturers and suppliers will be the key to ensuring the supply chain is on the same page and all share a common goal to become sustainable. Transparency is crucial to the success of a sustainable initiative as well. There needs to be a plan in place and that plan should be passed along to all those involved. As well as a plan, the efforts associated with it should be easily seen by all members within the partnership.
Without everyone being on the same page, success will not be obtainable.
A manufacturer must first come up with their own way to become more sustainable and environmentally conscious. There are so many ways a manufacturer can help reduce their waste and curb their emissions. A reverse logistics plan can dramatically reduce the amount of waste a manufacturer will produce. By ensuring there is a plan in place for components and products that run their course can not only keep these products out of landfills, but help manufacturers cut down on the amount of raw materials they will need when producing a new product. More on reverse logistics: https://mfgtalkradio.com/remanufacturing-reverse-logistics-saving-money-the-environment-and-your-image/
Technology also plays a huge role when it comes to a manufacturer trying to become sustainable. The Internet of Things allows manufacturers to see their business like never before. Connected devices and a constant stream of data allows businesses to see exactly where they can trim the fat. By this we mean areas where businesses are using more energy than is absolutely necessary, manufacturing processes that use more material than needed or even as small as a door that is kept open during winter can all add up to wasted energy and materials, the two biggest concerns a manufacturer could have. A manufacturer that thoroughly investigates their own operation will see a dramatic increase in their efficiency and, with continued effort, can ultimately obtain the title of a sustainable manufacturer.
The benefits a manufacturer will see can far outweigh any initial investment into new sustainable processes or technology. Not only will they become more efficient, they can attract new business opportunities that were not available before. According to a new survey from Asia Pulp & Paper (APP), 50% of Millennials are willing to pay more for sustainable products and 39% will research sustainability practices of companies before making a purchase. So not only are they willing to pay more they are committed to doing business with sustainable businesses.
A sustainable manufacturer will have access to a previously untapped market, as well as the ability to increase profit margins. Becoming sustainable comes with its benefits in terms of efficiency as stated above, and this efficiency can help cut costs, and contradicts the current mindset that a sustainable business costs more to operate. Once the initial investments have been made the rest of the time a business is actually saving money every step of the way.
The supply chain will see amazing benefits as well. Relationships will become stronger when everyone has a common goal in mind, besides looking to improve their margins. A strong relationship between the links in a supply chain will foster increased communication and life-long partnerships that will benefit all parties involved in the sustainable mission. Furthermore, a sustainable supplier of raw materials could end up passing their savings onto the manufacturer, then that savings continues trickling down until it hits the consumer.
Sustainability is not something that will happen overnight. Communication and collaboration from the manufacturer all the way up through the supply chain is necessary in order to create a truly sustainable business. Manufacturers and suppliers will see incredible benefits from their sustainable efforts such as increased profit margins, interest from new customers, and a warm reception from the public. As policies and regulations continue to enforce the sustainable and green business mindset, the earlier a manufacturer and their supply chain makes the move to a sustainable business model, the easier time they will have when these regulations become more restrictive. The time is now to make the move to a sustainable state of mind.
Sources: http://3blmedia.com/News/Sustainability-Supply-Chain-Starts-our-Employees
http://www.strategicsourceror.com/2016/01/balancing-supply-chain-sustainability.html
