As consumers and brands grow more environmentally conscious, carriers and fleets may wonder how they can contribute by considering green logistics. But what exactly is green logistics and why is it so important?
What is green logistics?
Green logistics, also called eco-logistics, examines how those involved in the logistics industry can be more sustainable with their companies. It seeks to reduce the environmental impacts of logistics. By implementing environmentally aware policies and measures, it tries to find a balance between ecology and economic needs.
Some goals of green logistics include but are not limited to:
- Reduce greenhouse gas emissions
- Lower fuel consumption
- Streamline delivery routes
- Offset carbon emissions
- Rely on clean fuel and renewable energy
Why should it be a priority?
The transportation business has a big influence on carbon emissions. According to the Environmental Protection Agency (EPA), the Transportation economic sector is the single largest contributor of greenhouse gas emissions in the US in 2020.
Standing at 27%, they emitted 1,615 million metric tons of CO2 equivalent. This primarily came from using up fossil fuel in cars, trucks, ships, trains, and planes. 26% of transportation’s greenhouse emissions came from medium and heavy-duty vehicles.
Customers and suppliers are growing environmentally conscious to a point where some are willing to pay more for businesses who adhere to green policies; making it crucial to their investment decisions. IBM reports 60% of consumers are “willing to change their shopping habits to reduce environmental impact.”
The Harvard Business Review (HBR) also found that big global multinationals are using the Carbon Disclosure Project’s (CDP’s) Supply Chain Program to determine supplier’s standing in sustainability and carbon footprint. In turn, suppliers want to hire carriers who adhere to green logistics policies.
The challenges to green logistics
While carriers may want to strive to be eco-friendly, there are challenges they need to consider:
- The transport industry relies heavily on nonrenewable fuels. Effective and economically viable solutions have yet to be found.
- Last mile deliveries, also e-commerce, has had a profound impact. The need for e-commerce has greatly increased thanks to the COVID pandemic. Many major cities have increased the volume of delivery trucks, many of which operate without carrying a full load.
- The need to invest immediately. Tight rates and margins don’t allow the time to think about what a carrier may be investing in. While more efficient vehicles and equipment may save for the long haul, it's a huge up-front investment that usually can’t happen all at once.
How to implement green logistics for your carrier
While you may chew over going green for your carrier, it doesn’t have to be expensive. The efficiencies that improve your eco-friendliness also improve your bottom line.
- Optimize route planning. Less mileage on the road lowers carbon emissions. By using a route planner, a carrier can optimize multi-stop routes and increase vehicle efficiency.
- Batching goods together. Group together goods going out to the same area within the same time window. This will reduce the number of vehicles dispatched.
- Digitize paper documents. With today’s current technology, consider digitizing your carrier’s operations and cutting back on paper costs.
- Night-time delivery. The more time vehicles spend on the road, the more energy being used. Making deliveries during nighttime can reduce road congestion and idling.
Going green may be intimidating but it doesn’t have to be. While it may take time to overcome the challenges to green logistics, you can start by making small changes within your business and carrier. By understanding why you and your carrier matter in being eco-friendly, you can make the first steps.