Decentralized system keeps emissions down
As our orders continue to grow, our nimble logistics team has to do some fast-stepping to keep pace with our goals to reduce the greenhouse gas emissions (GHG) associated with transporting our products, keep costs down, and provide excellent customer service. The hallmark of our transportation work is a decentralized network of five distribution centers strategically located close to our customers to minimize miles traveled and decrease order times. As we instituted this system in mid-2009, 2010 was the first year that we were able to reap the full benefits of this change — a 24% reduction in GHG emissions per metric ton of product shipped in the past year and a 35% reduction since 2008 — the latter comparison more accurately reflects the impact of this initiative. Our customers also appreciated the 50% drop in lead time from order placement to customer delivery — down to five days.
While we have reduced emissions, we have also saved money and are insulating ourselves from the effects of future gas price increases. This initiative demonstrates that pursuing a sustainability agenda benefits our business and we hope it will inspire others who are swayed by arguments of financial return.
While our decentralized system significantly cuts miles traveled and GHG emissions, it requires us to maintain greater inventory and increases the complexity of our operations. To meet these inventory needs and rapidly growing demand in the southeastern United States, we moved to a new, larger Atlanta warehouse. Another 2010 change worked against us as our diaper manufacturer closed its west coast operation and now only ships from the east coast. While 35% of our diaper orders must now be shipped farther; the impact of this facility closure is softened by the new design of our diapers. They are now thinner (with the same premium absorbency) and 15–18% more can fit on each truckload. In 2011 we will continue to push for full-truck load shipping/pooling and search for opportunities to use our sustainability influence to increase our shipping partners’ fuel efficiency.
Another change in 2010 allowed us the opportunity to optimize our inbound shipping while taking values beyond cost and efficiency into consideration. By consolidating our inbound shipping with the company that handles our outbound shipping, we were able to increase efficiency. But we knew this would have a significant impact on the excellent small company that had previously handled our inbound transport. Working with both parties, we were able to incorporate our existing provider into the consolidated solution, providing a win for all three partners. Maintaining some of our business with that company did not increase costs and was the right thing to do. Director of Logistics Chip Nolin noted that, “We often talk about equity and justice at Seventh Generation and this seemed like one way that I could integrate that piece into my logistics work.”
Reducing paper. Logistics is all about finding efficiencies — not all of these involve miles travelled. Reducing paper in our operations streamlines our work and benefits the environment. In 2010:
- We switched to electronic billing and saved almost 25,000 sheets of paper (12,382 orders x 2 pages for each order).
- Converted four major vendors to a fully electronic management system covering order placement to invoicing.