E-Sourcing Forum » Green logisitics is not a passing fad

Green logisitics is not a passing fad

September 11th, 2008 at 06:49am David Bush - Iasta

But, apparently it is one that most people lack understanding of the costs associated. In this recent article by Supplychainbrain, which is highlighting a study by Kewill.

..found that three-quarters of respondents who awarded logistics contracts included sections on environmental compliance in their tender documents. However, most (54%) failed to make provision for the extra costs that could be involved.

In the survey, 70% of companies awarding contracts said that environmental compliance was either ‘reasonably important’ or ‘very important’. Survey respondents were also probed about whether their companies’ environmental enthusiasm would change in the coming years, given the chances of an economic slowdown. The overwhelming sentiment seemed to be no–but according to two-thirds of respondents, that is largely due to the ‘win-win’ of implementing green initiatives which bring operational efficiencies and also cut costs. The number who said they would continue to pay more for an environmentally friendly alternative (17%) was balanced by the proportion who said they would base their sourcing decisions on cost alone.

It seems surprising that the basics are being missed here. These are admirable and achievable goals for sourcing, but procurement should always be asking questions about the impact on costs. I suppose the moral of the story is always understand the total cost and if you suspect there are things you do not know, ask the questions. That’s what an RFx engine will do easily.

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Entry Filed under: Analysts/Research, General, Green Sourcing

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