Sustainability in logistics and supply chain is now imperative for all organizations that need to operate efficiently. As the freight brokering industry continues to grow, so does the importance of sustainability for brokers and their clients.
Freight brokers and trucking companies are responsible for transporting goods across international borders. Changes within the industry have created an increased need for these businesses to be sustainable, operate efficiently, and reduce their environmental impact.
Sustainability efforts from freight brokers and trucking companies contribute to the reduction of CO2 emissions, reduction of waste generated during transportation, and reducing negative impacts on the ecosystem.
As such, logistic companies must understand the factors that come into play when creating a sustainable business model.
What Is Supply Chain Sustainability?
Supply chain sustainability describes a company supply chain’s effect on society, the economy, and the environment. Supply chain management that achieves sustainability within social and natural boundaries operates at maximum performance.
Logistics involves arranging proper transportation, storage, and distribution of goods. The supply chain in logistics must be efficient and sustainable to meet customers’ needs while reducing costs and protecting the environment.
Free load boards help shippers advertise freight transportation needs and loads. Independent contractors, trucking companies, and brokers respond to the needs promoted by shipping companies.
Free load boards, independent contractors, trucking companies, and brokers directly impact the supply chain’s sustainability. They control how freight is shipped, which can change the environmental footprint and cost of transportation.
Why Is Supply Chain Sustainability Important?
Most of an organization’s environmental effect results from its supply chain operations. From beginning to conclusion, supply chains typically demand a lot of energy. Production and transportation generate a lot of carbon emissions.
Sustainability in the supply chain protects natural resources and commercial resources and gives customers ethical shopping options. The majority of customers want to work with businesses that use sustainable methods.
Sustainable supply chains use natural and renewable resources, such as green fuel for trucks. Transportation of goods in this manner can reduce global warming by reducing emissions of greenhouse gasses into the atmosphere during transport.
Increasing sustainability across your supply chain benefits the environment and other areas of your business. Sustainability in your supply chain can boost productivity and increase profitability for your company.
You will benefit from reduced costs and a beneficial environmental impact by making transportation practices more efficient.
5 Benefits of Supply Chain Sustainability
A sustainable supply chain benefits your business by reducing operating costs and helping protect the environment. Sustainable supply chains also create positive impressions in the community for your organization and promote a good image that will help you get employees and customers. Here are the benefits of sustainability in logistics and supply chains.
Minimized Environmental Impact
A sustainable supply chain helps reduce the adverse effects on the environment of your operations, contributing to your organization’s sustainability goals. Sustainable practices will allow you to meet your environmental objectives and produce business savings.
Transportation using renewable resources decreases harmful emissions from fuel. Using more green energy and more efficient engines can reduce your carbon footprint from freight transportation.
Increased Profitability
Sustainable supply chains generate efficiency and cost savings, boosting industry profitability and competitiveness. Freight industries benefit from reduced operating costs as they become more sustainable by using renewable energy sources rather than fossil fuels and reducing packaging waste with innovative designs.
Additionally, they implement cleaner technologies, reducing necessary transportation distances by decreasing required inventory levels and measures that improve the business’s bottom line. The environmental benefits of sustainable transportation and materials reduce fuel, labor, and insurance coverage costs.
Better Organizational Reputation
Sustainability increases the environmental and social reputation of your freight company. Sustainable supply chains increase the public’s perception of your organization, creating positive impressions and improving brand recognition.
Eco-friendly and sustainable practices strengthen your reputation with your customers and potential employees. Customers choose to work with companies that prove they are socially responsible and responsible for protecting the environment.
Government agencies and environmental groups continually monitor freight industries to ensure their activities are sustainable. Organizations with an eco-friendly image will be able to deflect criticism.
Increased Productivity at All Levels of the Supply Chain
Sustainable practices within an organization increase productivity across all supply chain levels to meet customers’ needs while minimizing expenses and contributing to business profitability.
Freight companies and brokers use various management tools to maximize productivity, including calling center and warehouse operations, freight management systems, analytics, and ports.
Supply chain management software’s main benefit is increasing productivity through changes in employee behavior and procedures. Your team saves the time needed for manual tasks because employees complete orders more efficiently.
Improved Risk Management Across Your Supply Chain
You will always run some risk when working with outside vendors in the freight industry. You will need to address risks among your suppliers, including those related to cybersecurity, the possibility of regulatory non-compliance, and financial or operational weaknesses.
You must do routine risk analyses of your suppliers and implement control measures to recognize and monitor potential threats to improve supply chain sustainability. Implementing an effective compliance program within your business can help improve your supply chain control.
How Should Businesses Approach Supply Chain Sustainability?
To make sustainable practices work across your logistics and supply chain, develop a strategy to move the company in the right direction. Here are a few tips for creating the right approach.
Make Sustainability a Priority
Your sustainability strategy should match your business needs and goals so you can identify opportunities for positive change within your logistics or supply chain.
You need to take an inventory of your current practices, understand their impact on the environment, and determine whether your changes will improve sustainability for your trucking company and its community.
Establish Expectations
Customers will expect companies to reduce the environmental footprint of their logistics. Fulfilling this expectation can help your freight operation gain a competitive advantage, increase profitability, and improve your company’s reputation.
Monitor Performance
You should develop key performance indicators (KPIs) to track progress toward environmental and social objectives. This approach allows your company to evaluate its progress and adjust to meet sustainability goals.
Wrapping Up
Sustainable supply chain practices help reduce the adverse effects of supply chain activities on the environment and improve your company’s reputation. You can progress toward meeting business goals and creating a sustainable future by implementing sustainable logistics and supply chain operations in your freight operation.