2Sustain

Despite the economic downturn, companies are continuing to work on improving supply chain sustainability. However, it’s clear that financial ROI is becoming more important than ever before.

In the 2010 North American Sustainable Supply Chain Report, recently released by eyefortransport, financial ROI is now the second highest driver of supply chain sustainability –catapulting from its ranking as the ninth highest driver in 2009.

The survey, conducted in March and April 2010, polled 600 business professionals. 48 percent of these represented shippers.  29 percent represented 3PLs. And, 23 percent represented supply chain solution providers.

Among this group, working to improve supply chain sustainability remains a significant priority. This year, the largest number of shipper respondents reported environmental issues as being “important.” In 2009, however, a larger number considered these issues “very important.” By contrast, results from 3PLs remained fairly consistent this year and last, with the majority of respondents describing environmental issues as “important.”

What’s driving action on sustainability concerns? Almost 80 percent of those polled said that ROI was an important driver of sustainability initiatives –although that didn’t make it the chief motivating factor.  Improving customer relations was seen as a slightly more significant driver, while increasing supply chain efficiency was seen as slightly less significant.

Interestingly, most shippers reported the greatest levels of ROI from improving energy efficiency and recycling materials. Around three quarters of respondents reported either very or fairly successful ROI from initiatives like these, compared to only 3 percent not seeing any benefits. Other notable responses included: strategic warehouse/distribution center placement, reducing packaging, emission measuring/ reductions, and using more efficient transport modes –all of which saw about half of shippers reporting either very or fairly successful ROI.

3PLs also reported the greatest levels of ROI from improving energy efficiency, with reducing miles through vehicle re-routing as the next most successful initiative. Again, around three quarters of respondents reported either very or fairly successful ROI from these initiatives, compared to only 3 percent who didn’t see benefits, at all.

When survey participants were asked what they think will be “the next big thing” to provide a push for companies to improve the sustainability of their supply chains, the results were fairly uniform across the different groups of respondents. The two most anticipated drivers cited were: firmer legislation/regulation and consumer driven demand.

The 25-page report is available here.