Sustainable Supply Chain Best Practices — The Ultimate Guide

Factors Affecting Sustainable Supply Chain Practices

1. Technology

Many software applications and advancements in technology support sustainable supply chain management. 

When employees learn and adopt technological advancements that help your company achieve the supply chain, you will be able to see good results. 

When employees are having difficulty adopting technology, it may be harder to implement lasting changes.

2. The commitment of the company

When stakeholders of the company are fully on board with achieving sustainability in the supply chain, especially the managers and executives, it will be easier to develop a sustainable supply chain strategy. 

If the decision-makers in the company disagree with one another on what practice to adopt, contradictions may arise which results in poor planning of sustainable supply chain strategy.

3. Brand reputation and company culture

Sustainability in the supply chain has a positive impact on the brand image of the company. Additionally, if the culture of the company supports sustainability, then introducing sustainable practices will go smoothly. 

The success of achieving sustainability in your supply chain decreases if the company’s culture does not support sustainability initiatives and consumer demand is not strong enough to drive change in the company.

4. Cost

Starting your journey in sustainability entails spending a lot. The expense of investing in infrastructure and equipment may be daunting. However, these investments can lead to long-term savings. 

5. The knowledge of your stakeholders 

The expertise of the employees can have a big impact on supply chain performance at every stage. Involving employees that have knowledge of sustainability can help companies to make the best use of sustainable resources, and solutions and optimize results. 

Sustainable Best Practicesin Supply Chain

1. Map your supply chain

Of course, the very first step in improving sustainability in the supply chain is to know what is going on with your own supply chain processes. It may seem simple but many companies do not have a clear view of their supply chain. 

For example, you may have a close relationship with your primary supplier, but not with your other suppliers as you do not know them well. 

To know how your efforts for a sustainable supply chain affect the environment, you need to have a detailed analysis of every step of the product journey in your process.

2. Share sustainable policies with all stakeholders

Sustainability in the supply chain does not only entail changes in your processes but also in the people involved in your supply chain. Thus, your policies must be developed and aligned with the company’s overall objectives and goals. 

Additionally, you need to share your environmental and social responsibility initiatives in a way that all stakeholders in your company understand their part in helping the world recover from global warming.

3. Embrace the circular economy

The circular economy aims to eliminate waste. Thus, it is imperative to embrace it to attain sustainability in your supply chain. 

In a circular economy, products are manufactured and designed with production and reproduction cycles in mind. In simple terms, it employs the recycling of materials to reduce the problem of waste materials.

4. Communicate your expectations with suppliers

It is important that you source suppliers that meet your standards and requirements around sustainability. 

The supplier’s responsibility is to deliver high-quality materials that meet your expectations in achieving sustainability. 

When selecting your suppliers, you must communicate your expectations around these factors:

• Labor conditions
• Energy consumption
• Carbon emissions
• Water usage
• Recycling
• Healthy and safety of their employees
• Fair and lawful wages

5. Create key performance indicators (KPIs)

We all know that we cannot improve what we cannot evaluate or measure. Hence, the need to create sustainable objectives and track their progress. 

Also, you can use government regulations and scientific recommendations as key performance indicators. 

Example of a Successful Sustainability Agenda

Patagonia, an outdoor clothing brand, has built a successful business while also having a clear vision to protect nature. Its vision has translated into actions by donating to worthy environmental causes.

Patagonia’s Common Thread Recycling Program has taken back 45 tons of clothes for recycling and 34 tons for transforming them into new clothes.

Its bold move to make all its clothes recyclable is due to its Common Thread Initiative which encouraged customers to repair and reuse the clothes instead of disposing of them right away.

The initiative sprouted from their perspective that reducing is the solution. For clothes that wear out quickly, Patagonia has offered free customer repair services that keep the life cycle of their products longer.

When asked about their success, they said that the discerning consumer that they target will more likely buy their products even if it is more pricey. This is because their clothes last longer which avoids users to make replacements often.

Their free repair service has also attracted consumers and helps the environment as it discourages the buyer to dispose of it once it gets torn.