In a recent QuickTake Panel with eHub partner LOGIWA, co-hosted by eHub, four experienced and sustainability-driven guest panelists discuss the topic of “How 3PLs Win Through Sustainable Fulfillment Operations” through 3 specific topics:
- What it means to become a sustainable fulfillment operator
- How sustainability can drive growth for 3PLs
- Steps to take to create sustainable operations
Sustainability – What Does it Mean for Companies?
Sustainability in business aims to reduce the environmental impact companies cause through their operations. For 3PLs, companies, brands, and consumers and customers alike, sustainability is an inevitable and driving factor in the future decisions for what businesses will be supported, and how businesses will conduct their operations, including through 3PLs and fulfillment. Logiwa’s quicktake panel goes over how sustainability has been achieved by their companies, how it can be achieved by others, and the ultimate impact and advantage sustainability can provide to 3PLs and businesses wanting to take that journey.
Here are some of the highlights from the panel’s answers to the topics:
TOPIC 1: WHAT IT MEANS TO BECOME A SUSTAINABLE FULFILLMENT OPERATOR
Jamie: For a 3PL business owner, some of Logiwa’s customer’s sustainability is operating in a manner that’s going to minimize the negative impact on environment, society, economy, but will also maximize the positive impacts.
Reid: [Sustainability] applies to a lot of different facets for the customer itself.
How do you go above and beyond for the customer and show them that you’re considering things that they might not have even thought of themselves that apply into the sustainability bucket.
George: Sustainability is a journey. It’s a journey for your business,…where you as a business owner or a member of a team decide to pick up the banner and go on that journey…and include as a stakeholder and a decision-making process; are [you] factoring in the environmental impact of these decisions? Obviously we all want to build successful businesses…but in addition to that are we taking into account what effect this has on the planet, on the environment, on the communities that we operate and live in.
Sustainability takes into account not only doing good business, but how we are rooting for the planet, for the community, for the people that we care about and who we’re gonna leave the world to.
TOPIC 2: HOW SUSTAINABILITY CAN DRIVE GROWTH FOR 3PLs
Wayne: From a pure business perspective, why would a 3pl or a brand managing their own fulfillment for that matter consider making this investment in sustainability?
Reid: I’d say the biggest thing is this no longer a niche play, or it should no longer be a niche play
If you make money, great, but if you’re not putting it to good use or to good focus then I’d say nobody effectively wins.
George: The bottom line is customers are demanding it. Customers are demanding. Consumers are demanding it. So, as much as it is the right thing to do it is also a very pragmatic business decision. The shift towards sustainability is inevitable. Are you going to be forced to do it down the road, or are you going to do it now and really put your stamp in that space as one of the early thought leaders, early companies that adapted these principles in sustainability as a north star. From a branding perspective, it makes so much sense as well…[because] it’s very rare that I come across a 3PL that is able to confidently assert that sustainability is one of their top values. So from the fact that it’s a small saturation of 3pls that are practicing sustainability as a high priority right now, is an immediate competitive advantage
Jamie: sustainability has…transitioned…[in that] it’s going to become a competitive neutralizer, if you’re not doing it you’re behind the curve.
There’s a lot of ways that we can impact that. Particularly things like smart routing of orders, or if we’re recommending the proper package types, or trying to run an order to a particular location where there’s gonna be the least amount of transport.
George: The branding of sustainability catches a niche audience.
I’ve had customers over the last year and a half that…[say] “just because you do what you do and you do it in a way that is sustainable you have my business”
Just by the virtue of your value, you’re attracting [an] audience.
[Another] thing that’s important is for you to share your data with your customers. Having a partner that knows how and represents the data back to them is super important in terms of customer loyalty…[it creates] a really virtuous chain reaction of data and action
Adam: There’s this thought that sustainable fulfillment is more expensive, and I think there’s a lot of misconceptions…because reducing waste can absolutely be a very economical and cost effective thing to be doing.
One example we had was a 3PL [that was] working through the prospecting stages of bringing on a merchant…[Their] primary focus…was cost savings. One of the things that we discovered [was] we could help right-size package some of their high-volume products, eliminating waste, and the projected savings on that was 40,000 dollars
Reid: [With less packaging] You’re can also save your operations team from creating the box, closing the box and going from there which eventually plays into an efficiency aspect because [when you’re] looking at the bottom line, it not only makes sense for the customer, but it’s also saving the operations team allowing them to process more orders. So really it’s a win win.
George: Utilizing sustainable materials and sustainable supplies [is] super important. The only thing more sustainable than that is using less of it…[at Manifest] we work with each client to find the optimal packaging.
Bottom line is…customer loyalty.
We all know the upfront customer acquisitions costs in this business aren’t easy to swallow.
So being able to retain those clients and have their loyalty and have them super happy with the service you provide and very proud to be working with you and them seeing you as your true supply chain partner just creates a longer, more prosperous relationship in the long run.
TOPIC 3: STEPS TO TAKE TO CREATE SUSTAINABLE OPERATIONS
Wayne: Is [creating sustainability] incremental, or is it a more wholesale way to…move your operations into a…sustainable mode of operating?
George: Part of the problem [is] everybody wants to be sustainable and build sustainable businesses.
There are very small things that you can start off with and start to make a difference and compound into realistic and formidable progress, and don’t be afraid to lean on what others are doing. Copy us, copy other ideas, and then that’s the easiest path. You don’t need to put pressure on yourself and your team to reinvent the wheel or invent the wheel for sustainability for your fulfillment operations, there are small things that are happening every day all around you that you can start to implement
For example, one of the first things that we decided to do was offset the carbon footprint on all of our shipments.
Something as simple as walking around your warehouse and deciding [if you’re using] the right LED lights that save power,…[implementing] movement track lighting. And then recycling…the amount of trash that gets picked up, the amount of cardboard…that nobody wants to pick up…so figuring out ways what to do with all that excess waste and trash.
All those are steps that compound into really meaningful differences.
Jamie: One of the key factors in the momentum behind sustainability is that there’s so many different avenues to go start.
The more of these opportunities to build your brand and business that you can take advantage of, the more these levers that you can pull, the more advantageous you’re going to be.
LED bulbs, motion sensors, or usage of natural light. Sometimes it’s just as simple as painting your roof white, and minimizing your cooling costs.
Adam: There’s a lot of partners, there’s a lot of people out there that can help you, and so I would just say work with those around you, join whatever community partnership you want to in order to take the first steps.
Leverage the community we have in order to make progress on those initiatives.
Reid: Let’s continue to…share [these things]. Let’s continue to make them even better because if we go out there and just hold onto them, that’s not going to be good for anyone. That’s not even a sustainable concept.
The sustainability…is truly in the networking side and also in the delivery side.
George: The market is driving us.
The shift towards sustainability is inevitable, so as a business owner you need to have it on your map.
This is a journey, and small steps are ok. They will compound into more and more progress and…implementation. Adapting that into your roadmap…thinking and…decision making for you and your team is the best way to get started and you’ll be surprised how much progress you can make really quickly just by making decisions and thinking about your business in environmentally friendly and sustainable ways.