How Technology Makes Your Logistics More Sustainable

21 November 2022

Discover what sustainable logistics is and how to implement it in your company.

Have you ever stopped to think if your supply chain is sustainable? How are goods shipped to your warehouse and to your customers? What is being done internally to reduce waste? These questions say a lot about how your company positions itself regarding environmental protection, a latent theme in the business world that must be taken seriously.

Sustainability in logistics has gained increasing relevance because this is one of the sectors of the company that can directly impact the environment. It is not enough to have sustainable production. It is also necessary to examine how inventory, order shipping, and transportation are managed. This even interferes with how the customer views your company.

It is well known that, now more than ever, consumers have started to purchase products in line with their personal values, from raw materials to packaging. Recently, Unilever published a study that found that out of three customers, at least one chooses to buy from brands that have a social or environmental impact.

Knowing the importance of sustainable actions, several companies are trying to adopt measures to reduce environmental impact in all production sectors, including logistics. Amazon, for example, has committed to achieving carbon neutrality by 2030, investing in renewable energy and battery-powered fleets to do so. DHL has integrated sustainability into its overall strategy, publishing reports on sustainability efforts, launching a podcast on the subject, and ensuring that its fleet and operations reduce emissions.

And your company? How have you applied sustainability in logistics? Having a “green warehouse” goes far beyond doing something positive for the planet. It is also an effective way to reduce costs and streamline processes, including improving customer service. In other words, companies must find a balance between growth, profitability, and sustainability. In this text, we will explain green logistics and show how technology can be a great ally of sustainable practices.

What is sustainable or green logistics?

Sustainable logistics can be defined as a series of measures adopted with the aim of reducing environmental impact both in warehouse operations and in the transportation of products/orders. The reduction of paper use in various administrative departments is an example of how companies are already seeking new ways to include environmental responsibility in their agendas. Sustainable logistics represents an additional strategy for companies to continue collaborating with environmental preservation.

Logistical processes can generate various waste, in addition to using transport that emits CO² in large quantities. Sustainable logistics aims to reduce these impacts by adding other models that take this goal into account.

In this sense, having an ecologically correct supply chain means seeking ways to reduce resource consumption, waste of inputs, and generated waste, as well as promoting transparency in both operations and relationships with suppliers.

Advantages of sustainable logistics

Companies that focus on ESG (Environmental, Social, and Governance) aspects are in line with the ideals of their audience and also position themselves at the forefront of the competitive market. In the case of the aspect related to the environment, in addition to contributing to the future of the next generations, changing some business standards towards sustainable models brings benefits that leverage actions and sales with better resource utilization, waste elimination, and the use of renewable energy. Other advantages include:

Better reputation among consumers

A company that adopts measures to commit to the environmental cause, such as the use of sustainable logistics, demonstrates its concern for the planet. Additionally, it can improve the efficiency of the processes involved and lead to cost reduction, agility in the delivery system, and gaining the trust of customers who increasingly appreciate a socially and environmentally responsible company.

Opening to new partnerships

By prioritizing sustainable logistics, you increase your business opportunities. This is because, when they add sustainable values, other companies must ensure they work with partners who align with their mission to reduce negative environmental, social, and economic impacts. Therefore, they only consider companies that share their sustainability ambitions.

Moreover, many tenders now require organizations to demonstrate their commitment to sustainability through accreditations such as ISO 14001 (the international standard for environmental management systems).

Sustainable logistics can differentiate your business from the competition and lead to greater sales or work opportunities and partnership possibilities, increasing your profitability.

Generation of new revenue streams

An available option is to sell the waste produced by your company. The sustainability trend forces organizations to recycle waste. In this way, you can help these companies source raw materials and, at the same time, make a profit from the sale, which can also be donated to the local community or investments with ESG values.

Increase in internal satisfaction, retention, and recruitment of staff

It is not only potential customers and partners who invest in sustainable organizations. Many employees are happy to be part of environmentally, socially, and economically responsible companies. A happy team tends to be more productive and loyal to your business. Additionally, during the recruitment process, supply chain sustainability can also attract new green and socially conscious talents.

Overall cost reduction

Many think that having a more sustainable logistics process is expensive. But the point is this: sustainability can save your company money and improve your profitability. For example, if you replace high-energy-consuming equipment and appliances with environmentally friendly alternatives, you will not only reduce environmental impact but also save on your company’s bills.

How to implement sustainable logistics?

First, you need to understand that there are 3 fundamental objectives in a sustainable warehouse. They are:

– Reduce CO² emissions

– Properly dispose of waste

– Optimize the transportation route

From this, it is possible to implement changes in logistical processes, and technology can greatly assist in their execution. Check out some suggestions below:

Invest in cheaper and less polluting deliveries

Switch to more efficient and environmentally friendly vehicles. Today, there are less polluting transportation alternatives, such as electric and hybrid cars, which could prove crucial for the logistics of the future.

Prioritize proper volume cubing

In general, the term cubing refers to the volume of an object. In logistics, it is essential to make calculations to use the right packaging for the product and/or order. Therefore, in addition to saving space on your truck and in the warehouse, your company will use less packaging material and, consequently, generate less waste since most packaging is not reused by consumers.

When relying on a management system, such as a WMS, cubing is done automatically, meaning the software itself will indicate the ideal packaging for each product/order, always aiming for the best resource utilization.

Leverage the full potential of reverse logistics

Reverse logistics encompasses the entire process of moving goods from the point of consumption to a consolidation point. Some examples of reverse logistics are:

– Return of goods by customers

– Return of unsold goods by distribution partners due to contractual conditions

– Reuse of packaging

– Repairs and maintenance as per warranty agreements

– Reproduction of goods from returned or defective items

– Recycling and disposal

Regarding returns, the WMS system greatly aids in handling each product that returns to the warehouse, avoiding losses and waste.

Promote environmental awareness among employees

Improving employee engagement to make logistics sustainable can lead to a more motivated, productive, and dynamic workforce. But to achieve this goal, it is important to have policies and programs that encourage sustainable behaviors.

Leverage technology throughout the logistics process

Currently, a wide variety of technologies are available that can make production and development go hand in hand. To make logistics sustainable, the following tools can be adopted, for example:

– A warehouse management system (WMS)

– Order preparation technology

– Barcodes

– Radio frequency identification (RFID)

– Automation systems

The WMS aims to optimize supply chain operations, using less to achieve more, that is, reducing the amount of resources needed to perform each task. Additionally, by offering total visibility of the operation and real-time data, the WMS helps managers identify possible failures and waste that could impact the sustainable business proposal.

A very effective way to reduce paper use is to modify pick lists and data collectors. These technologies improve processes and increase product visibility throughout the supply chain. With technology, it is also possible to improve order collection in terms of accuracy and speed.

Regarding automation systems, such as AGV, pick-to-light, voice picking, shuttle, etc., they greatly help in the intelligent use of resources, avoiding waste resulting from various orders. For example, picking systems eliminate paper use and errors, avoiding possible losses. The shuttle saves a lot of space.

How can WMS Deagor make your warehouse more sustainable?

As mentioned earlier, the WMS optimizes supply chain operations. With the automation offered by WMS, you replace slow and ineffective processes with optimized and agile processes. Your resources (people, equipment, and area) are now better utilized. Additionally, a fundamental advantage offered by the software is the centralization and reliability of data. Among the main benefits offered by the system that impact sustainable logistics are:

Space saving

A warehouse with WMS uses less space to store products compared to a 100% manual operation. This is because the system performs intelligent addressing, aiming to make the most of every square meter of your warehouse. In this way, for example, expansion works that could have environmental impacts are avoided.

Less energy consumption

Automated warehouses save energy in various ways. For example, smaller areas require less lighting and cooling. The WMS controls all product flows and optimizes product movements, saving energy.

No waste

A warehouse automated by WMS has no unnecessary movements. Additionally, since automated order picking is more accurate, returns are reduced, and the savings associated with fuel, labor, and operational costs benefit the entire company.

Traceability and control at reception: reduction of losses

The WMS automatically monitors all product information and their movements, thus avoiding various losses. With the system in your warehouse, you can implement shelf life control, determining an expiration date for receiving products. This means the risk of malfunctions is much lower.

Inventories and stock level management

In addition to the benefits mentioned in the previous topic, it is also important to emphasize that the WMS offers cyclical inventory options to ensure total control of the operation, as well as managing stock rotation, following standards like FIFO/FEFO to avoid damage and balance stock levels so that there is no excess stock. All this means the elimination of waste and, consequently, the disposal of damaged goods.