Logistics Management

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CHECkLIST

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Logistics Management Practices

This checklist outlines considerations related to packaging, distribution networks, and inventory practices for consumer goods. Encourage and incent your suppliers to adopt these practices as well.

ACTION AREA
Product Packaging

BEST PRACTICES
Reduce packaging volume and weight. Change packaging shape and design to increase density of shipments.

EXAMPLES AND CASE STUDIES
Mountain Equipment Co-op (MEC) has introduced “sushi packaging” as a green supply chain innovation. Producers roll items together to prevent them from wrinkling while taking up less space. It enables MEC to pack more goods safely into shipping cartons by eliminating individual plastic packaging and using less corrugated paper. This has boosted MEC’s distribution centre efficiency, reduced costs and lowered its carbon footprint. Hewlett Packard (HP) reduced packaging of expanded polyethylene and corrugated box material for its laptops sold in Wal-Mart stores by 97 percent. This packaging change allowed HP to double the number of units shipped in a given container or truck box. This increased density reduced GHG emissions, did not increase shipping damage, and using the tote bag as packaging became a selling feature. [ecoFreight case study] Hudson’s Bay Company (HBC) uses analytical software called Gems, which allows them to collect data on materials required for packaging products. This allows HBC to reduce GHG emissions created by the production and transportation of excess packaging. [HBC Corporate Social Responsibility Report] ROGERS Communications have achieved reduced packaging on outbound shipments by using reusable totes for shipping of rental digital boxes and modems and improved their retail packaging for HD and HDPVR digital boxes by replacing corrugated end caps with pulp-moulded end caps made of 100% re-cycled materials.

Transport packaging

Right sizing - ensuring contents fit their packaging with little unused space. This helps fit more boxes onto pallets, in trailers and in shipping containers. Perform a comprehensive network analysis, including procurement sources.

United Parcel Service (UPS) has established an Eco Responsible Packaging Program for its customers. Companies participating in this program allow UPS to conduct an evaluation of transport (secondary) packaging processes. These companies must meet criteria in three areas--damage prevention, right sizing, and materials content--to participate in the program. Subway restaurants created redistribution points (RDC) to consolidate outbound shipments. Instead of sending one pallet of a food item from a supplier to 60 distributors as was previously done, Subway now sources truckloads of the item, consolidates it with other proteins and sends full truckloads to regional locations. (Source: Logistics Management, April 2009) Comark, which operates three fashion divisions (Ricki’s, Bootlegger, and Cleo), reduced inventory travel by 30,000 kilometres (almost 200 km per shipment) and reduced costs by 35 percent, by using third party warehousing services. The new shipping solution decreased CO2 emissions by an estimated 2440 tonnes or 3 percent. [Purolator Service Guide]

Distribution network

Explore the efficiency of your distribution practices, including third-party warehousing options and/or direct-to-store shipments where these options reduce freight-kilometres.

ACTION AREA
Reduce circumstances leading to truck idling at shipping and receiving points

BEST PRACTICES
Implement driver-friendly practices for your shipping and receiving areas.

EXAMPLES AND CASE STUDIES
Sobeys distribution centres have indoor areas that provide delivery drivers with a comfortable area to wait while their vehicle is being loaded or unloaded. [Sobeys Sustainability Review] Potential example: well-marked lots and docks that allow trucks to enter and exit quickly and efficiently.

Delivery and Ordering Practices and Inventory Management

Develop an inventory management system that optimizes transportation efficiency.

Salt Spring Coffee Company, based on Saltspring Island, British Columbia saved 1.5 tonnes of GHGs per load by changing its ordering practices [Company website]. The company used to ship its coffee beans by boat from various ports around the world into Oakland, California and then truck them up to Vancouver. The company now makes fewer, larger orders and ships them straight to Vancouver. Grand & Toy has changed from its old business model based on next-day guaranteed delivery of any product to a default 48-hour delivery, which allows consolidation of orders, reducing both costs and environmental impacts. Grand & Toy will also work with clients to customize “right-day” delivery schedules. [ecoFreight case study]

Determine your customers’ needs to avoid unnecessary expedited orders.

Local or Regional Sourcing

Consider a move to more locally and regionally-sourced products and components, where this would not involve other environmental trade-offs*. * Environmental practices during the production process should be taken into account where applicable to avoid creating environmental impacts elsewhere in the supply chain. Life cycle analysis (LCAs) can assist in this process.

IkEA created a “smart” goods logistics e.g., using a bookbinding contractor between the printing house and the distribution center, to minimize total transportation distance [Natural Step case study].

Transloading

Transloading is the process of moving a shipment from one mode of transportation to another. For international marine shipments, consider the use of 53 foot containers (rather than 20 and 40 foot) to gain efficiencies during transloading.

Retailers like Canadian Tire generally transload imported containers at facilities near ocean Ports where good loaded at foreign suppliers are then transloaded into 53 foot domestic containers then hauled on either a truck chasiss or railcars to inland destinations. Most major retailers either outsource this process to 3PLs or operate their own distribution centre that performs this activity.

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