Green Logistics: Fashion Trend or Chance?

Green Logistics as a competitive advantage – Part 1

Green Logistics: A fashion trend or a chance to differentiate?

The main objective of environmental protection and policy is a low-emission future and, in the long term, a future with no emissions at all. The pressure on the economy  – and consequently on logistics – is growing:

In our series “Green Logistics as a Competitive Advantage”, we will examine the challenges and obstacles on the way towards climate-neutral logistics without any carbon footprint. We will present the options available, in particular concerning the optimization of logistic concepts and packaging which are already being implemented today and which have had an immediate effect. Because green logistics already has a lot to offer.

100% climate-neutral transport in Germany by 2050. Can this target be achieved?

An end to CO2!

Earlier, efficiency and cost considerations tended to focus on logistic targets such as cost reductions, the avoidance of high inventory levels as well as an increase in supply readiness and delivery quality. However,  in times of climate change and Emissions Trading Schemes, another aspect has come to the fore, namely sustainability.

The calls for ecological and resource-saving  logistic concepts and solutions – based on so-called Green Logistics – are becoming louder. Consumers, clients and governments are applying pressure on industry and on the logistic sector since this is closely connected to industry. And the pressure is growing – all the more since Greta Thunberg and “Fridays for Future” began stimulating the debate on the issue of CO2.

Social responsibility & sustainability

The logistic sector must adapt to these new challenges and, if necessary, rethink structurally if it wants to be sustainable. Many companies have already recognized that they are responsible for their impact on society and the environment. In line with their Corporate Social Responsibility (CSR) they are commiting themselves to sustainability and setting environmental targets which can also offer a decisive competitive advantage.

Logistics & CO2 – facts & data

The emissions produced by global supply chains contribute considerably towards global warming. Even though the logistic portfolio may comprise far more than just the conveyance of goods, transport and traffic are  currently one of the largest sources of greenhouse gas emissions worldwide.

Chart:

Graph –  The global distribution of  COemissions according to sector (2017)

According to the International Energy Agency (IEA), the traffic sector in OECD countries accounts for approx. 30% of CO emissions with road freight transport accounting for a third of this amount.

It is inconceivable that electricity will be the sole energy carrier for road freight transport in the near future!

E-trucks on our roads?

The emission values are to sink rapidly even though the volume of transport will increase drastically in the coming years. Regulations such as IMO 2020 (to reduce the sulphur content in marine fuels globally by 85%) or the plans of the German Environmental Cabinet Committee to promote more environmentally friendly fuel and engines in road freight transport are a step in the right direction.

In order to meet climate protection objectives, the importance of gas, hybrid and electric motors is increasing rapidly.The use of alternative fuels such as hydrogen, gas and electricity is growing. In Research and Development  – especially in the automotive industry – views are changing. Established market players are planning to produce E-trucks which can be deployed in the next few years. However, experts doubt that road freight transport in Germany will run entirely on electricity in the near future.

This situation needs more research – based on governmental discussions on diverse technologies, which enable new approaches and innovations in environmental policy. However, research and rethinking takes time. This is time we don’t have because society – first and foremost “Generation Greta” – is demanding more commitment for our climate and our planet today. We need to find other ways to achieve climate-neutral logistics without a carbon footprint.

Complex and green: is that possible?

Many logisticians have already recognized the challenges of climate change – as well as the chance that a rethink on green logistics brings . However, reducing emissions with a view to attaining effective sustainability is no easy task. Firstly, because the issue of climate change is a diffiult one already and secondly because of the complexity of the logistic task itself.

Even without considering issues like climate protection and ecological sustainability, logisitics is extremely multi-layered. With a number of influential factors such as delivery times, order amounts and stock quantities, transport routes and the deployment of resources, logistics appears too complex for fast and clear decisions. This is further reinforced by the rapidly advaning digital networking of individual core processes in globalized competition.

Logistics becomes green thanks to mathematics

On the contrary, however: it is precisely this complexity that provides huge scope and a range of courses for action. However, these have to be mastered in order to make the optimal decision – also regarding ecological sustainability. And this is where mathematics comes in: mathematical methods such as Prescriptive Analytics are ideally suited to calculate the best solutions. By evaluating processes, data and cross-dependencies, even complex logistic tasks can be solved efficiently.

Optimally planned logistics without a carbon footprint

Logistical planning optimization using OPTANO means far more than just organizing processes and structures efficiently and more flexibly. Specific recommendations for action offer suggestions concerning optimal material flows and route planning. On the one hand,  with a green logistics chain as a planning objective, corporate questions on investment planning can be answered as best as possible (“Which site expansion is feasible taking into account logistic and ecological aspects?”)

On the other hand, daily route planning with regard to optimal capacity and avoiding empty runs is easy (“How can I plan my delivery routes optimally?”). Resource requirements and the emission of pollutants are thus reduced – the best way towards climate-neutral logistics without a carbon footprint.

A good way

Those who can provide more ecologically friendly logistics in this way today contribute greatly towards climate protection…
… and manage to gain a distinct competitve advantage while doing so.

 Even more Green Logistics:

Green Logistics has even more to offer. In our further entries we’ll be looking at “logistic concepts” and “packaging and load carriers”. Because new approaches and optimization potential can be found here as well.

Do you want to learn more about OPTANO and Green Logistics?
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