How to be an Environmentally Sustainable Fulfillment Warehouse
It is evident that as e-commerce continues to grow, so too does its carbon footprint. As consumers continue to purchase products online, they are becoming more and more interested in green businesses. Businesses can be sustainable in many different ways. For example, it may mean planting a tree for each product sold, using compostable packaging, recycling, or donating merchandise. According to a Stifel and Morning Consult survey in May of 2021, 71% of US adults ages 18 to 55 care about product sustainability. An analysis by Harvard Business Review confirms that there is cognitive dissonance among e-commerce shoppers. 65% of shoppers want to support sustainable businesses and practices, but only 25% actually take action. Similarly, Shopify found in a survey that 49% of consumers are willing to pay more for sustainable shipping options. Even so, the same shoppers are more likely to choose same-day or next-day shipping, which has a much greater carbon footprint. When consumers desire to be more environmentally friendly but fail to adhere to these goals, how can the industry help facilitate these changes?
Third-Party Logistics (3PL's) are an integral part of the e-commerce landscape and are employed by a wide range of businesses in all types of e-commerce. With the consumer wanting businesses to adopt a more sustainable approach, 3PL's will also need to adapt. Here are the top eight action items 3PL's can adapt to become environmentally sustainable:
Steps to a Sustainable 3PL:
Analyze Carbon and Chemical Footprint
Understanding your company's carbon footprint and chemical footprint is a critical aspect of establishing your company as a leader in sustainability. In order to obtain the most accurate measurements of your carbon footprint, it is necessary to invest both time and money. The best way to complete this step is to contact a specialist or company to provide you with the most precise reading. Furthermore, they can also guide you to ways in which you can reduce your carbon footprint in the future.
Adjust Your Goals
The majority of companies that begin their sustainability journey have some idea of what they need to accomplish, but it is possible that the carbon report may significantly alter your goals. A professional environmental expert can assist you in developing an effective roadmap that focuses on what's most important to your organization. Guidance built by sustainability experts can cover goal topics such as waste, energy, emissions, business strategy, warehouse software, product footprint, supply chain, and more. Collaboration and communication are key.
Switch to Sustainable Materials and Packaging
In your position as a 3PL, it is very likely that you utilize thousands of boxes every day. Generally, most people and businesses now understand that cardboard boxes can be recycled and repurposed. Typically, packing peanuts, bubble wrap, and other packing materials are the most hazardous elements of packaging. The impact is the same whether it is disposed of in the trash, recycled, or repurposed. It is considered to be the most harmful part of shipping due to the amount of carbon emitted for the production of these types of packaging, as well as the unlikely hood that consumers will recycle them (if it is at all possible). A greener option would be to use biodegradable packaging or to pack without support. Broken products are, of course, not acceptable for anyone, so biodegradable or compostable packaging solutions make the most sense.
#ShipTip: The fulfillment industry commonly makes the mistake of packaging small products in large boxes or separating large orders into smaller, multi-boxed shipments. In order to ensure optimal performance, make sure that there are many different kinds of containers available at your disposal. This will be able to help you reduce the amount of filler you need to use and by reducing the amount of packaging you require and by using packaging that is appropriate for the order, you will not only benefit the environment but also save your company money on shipping costs.
Select Sustainable or Carbon-neutral Carriers and Shipping Methods
Fast shipping, such as next-day or two-day, is the most environmentally harmful. Despite the desire of consumers to receive their packages sooner rather than later, it is perhaps best not to provide consumers with a choice. Consumers will likely choose to use faster shipping if they are given the option. If you are concerned that eliminating options will negatively affect your bottom line, perhaps informing them about the carbon emissions involved in overnight shipping could raise their awareness and influence them to change their mind. Are you still concerned about the amount of carbon that your shipments contribute to the environment? Partner with carbon-neutral carriers or carrier services. There have been significant investments in carbon-neutral shipping methods and options, so it is important to work with carriers that share your interests.
Implement New Inventory Management Best Practices
Inventory Management malpractices can pose a great challenge depending on your 3PL's area of expertise. For example, your warehouse may be required to be temperature-controlled if it is storing temperature-sensitive items. As a 3PL, your warehouse is likely to store the products of multiple companies, and if the entire warehouse is set at the same temperature for a single company's products, you are wasting a great deal of energy. One solution is to create separate cold storage sections of your warehouse that use renewable energy sources, like solar energy to power to enable its cooling systems. Incorporating sustainable solutions that enable products to be quickly cooled and stored in pre-set cold storage zones will drastically reduce loss, and switching to solar power can lessen the warehouse's overall carbon footprint.
Reduce the Environmental Impact of Returns
In relation to their fulfillment services, 3PL's receive plenty of returns. With return rates at an all-time high, e-commerce is becoming increasingly dependent on seamless returns processing. However, as a result of single-use packaging designs, customers are often forced to use their own packaging when returning items. When a return is received back at the warehouse, items will often arrive in slightly battered boxes with multiple labels and/or packaging materials. The process not only decreases the customer experience but also increases the likelihood of items being damaged in transit when they are not packaged securely enough, which contributes to more waste. Although the warehouse may recycle the packaging once the goods are received, reusing the box would be more eco-friendly, but depending on what the items are shipped in, that's not always possible. Alternatively, you can save both your company and your customer time and money by using return-friendly packaging, such as double-sealed mailing envelopes.
Measure and Share Progress
It's great to be green; so, share it! Informing your clients about your warehouse's environmentally friendly practices is essential. As previously mentioned, consumer perception has a significant impact on a company's reputation. In general, people view sustainability as a positive attribute, and businesses with green values should be eager to publicize their best practices and progress. Being environmentally friendly demonstrates to the world that you care about more than just your financial well-being. When developing your brand identity and marketing your business, you can use this to your advantage. Regularly evaluating green-initiative practices and sharing waste-reducing progress lets customers know that they’re supporting companies that support the planet. It also helps attract new companies to utilize your fulfillment services who have the same goals.
Continuously Strive for Carbon-Neutral Status
While it is best to avoid or reduce carbon emissions as much as possible, industry trends and the availability of new technologies do not always make this the top priority. In order to achieve carbon neutrality, a company must balance its carbon emissions with carbon removal, resulting in a zero net release of carbon dioxide into the atmosphere. As technology changes, 3PL companies should be continually reevaluating and weighing their options in order to establish benefits for environmentally-friendly goals.
Remember, customers want to work with and be more environmentally friendly, but often forgo these initiatives for convenience. From quick, overnight shipping to throwing away packaging materials, consumers continually choose the higher carbon option. As a 3PL, you are most likely the ones behind the fulfillment choices and offerings. If you can label your warehouse as a sustainable warehouse, you can help companies market themselves and attract new customers.