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Sustainability has become an important motivator in retail. NYU Stern Center for Sustainable Business found that, between 2015 and 2019, sustainable products accounted for more than half (54.7%) of the growth within consumer packaged goods. According to a report by Accenture, 45% of consumers have started making more sustainable shopping selections in the wake of COVID-19.
These are just two of the many reports that highlight consumers’ desire to shop with brands that promote sustainability. Enterprises can take action today — and live up to buyer expectations — by creating a more sustainable supply chain.
This is easier said than done, though. While slow-steaming container ships can be effective at reducing both emissions and expenses, organizations may find it difficult to achieve sustainability internationally — across many global suppliers — when cost drives many supply-related decisions.
In order to overcome these challenges, businesses must evaluate all suppliers in the chain, as well as suppliers that serve their partners. This will allow firms to build a supply chain that is sustainable and environmentally efficient.
Meeting Consumer Values for a Better World and a More Successful Business
Supply chain networks often consist of an intricate mix of multiple parties and providers. The complexities don’t end there, however — businesses should also remember that every provider has its own set of suppliers, as well as partners in manufacturing and material sourcing.
Additionally, logistics companies have concerns that are unique to their business and include priorities, stakeholders, and pressures that must be managed. It might be tempting to focus only on the near-term bottom line during this difficult period, but the reality is that consumers appreciate sustainability. If businesses ignore their standards, consumers will be turned off.
Organizations should therefore concentrate on a strategy that fosters sustainability. They must work hard to ensure that their suppliers, as well as the wider network through each supplier, are doing the same. This will allow them to assure their customers that the brands they use are conducting business in a manner that is consistent with their values.
Be as Transparent as Possible
More than three-fourths (86%) of shoppers think transparency is more important than ever, and 73% are willing to pay more for products that are reliably transparent. Transparency is equally important within supply chains, improving responsibility by increasing agility, resiliency, and cost-effectiveness.
Supply chains can only become more sustainable by first becoming more responsible, so the need for transparency should not be taken lightly. Brands should thoroughly examine their suppliers, manufacturers, and logistical providers to determine how each of these businesses contributes to their sustainability goals.
It’s also worth noting that a decision at any point in the supply chain could negatively impact other parts of an organization’s operations. This would inevitably offset a brand’s overall progress, so businesses must clearly understand the consequences of each choice if they wish to conquer these challenges.
Data is at the heart of transparency and the ripple effect of decisions within the supply chain. Enterprises can be better prepared to achieve their sustainability goals by leading with a data-driven, transparent network that can adapt quickly and transition effectively to handle unanticipated events.
Build a More Sustainable Supply Chain
No business is exempt from these initiatives. Not even Apple, one of the biggest tech manufacturers, or Starbucks, one of the world’s largest coffee chains, can evade consumer expectations. The same rules apply to everyone. If any part of their supply chains were caught engaging in unethical or unsustainable practices, their businesses would suffer.
Thus, businesses should focus on building a more sustainable supply chain — but first they need to have a clear understanding of their entire supplier network. It is also necessary for businesses to accept accountability for all parties involved. In doing so, brands will be better prepared to manage and monitor a supply chain that is infused with data and built on transparency.
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