The growth of e-commerce could make it easier for supply chains to reduce their carbon footprint, according to a new report from DHL (DPSGY) and FINN Partners’ Global Supply Chain, Logistics & Transportation Practice.
“We started to dig in and look at a few key areas in the document where we believe e-commerce trends would impact sustainability,” Greg Hewitt, CEO of DHL Express USA, told Yahoo Finance Live (video shown -above ). “It was last mile, first and mid mile delivery, warehousing, packaging and returns. All of these areas have opportunities for greener solutions.
E-commerce is a small but growing part of the retail landscape. In the fourth quarter of 2019, online sales accounted for 11% of all retail sales. That number rose to 13.6% in the fourth quarter of 2020, when the pandemic led more consumers to search online for products they had purchased in stores.
These online shopping trends “have progressed five to seven years,” Hewitt said, adding that there was no sign of slowing down in online retail anytime soon. “What the newspaper has shown is that all is not pessimistic. This strong growth in electronic commerce does not mean a tragedy for the planet.
The three Es
According to Hewitt, the greatest opportunities for greener order fulfillment and delivery can be summed up by the “three Es” – energy, efficiency and eco-materials.
“Better use of energy, therefore electrification of the last mile, green electricity in warehouses, sustainable alternative fuels; efficiency, looking at things like route optimization, capacity, and conditioning reductions; then the introduction of new eco-materials which are better from a sustainability point of view around the packaging, ”he said.
But building sustainable supply chains also comes with challenges. The report cited the high cost of alternative jet fuels, the lack of charging infrastructure for electric vehicles and the availability of batteries as obstacles to reducing emissions.
And two crucial areas for e-commerce – packaging and returns – continue to raise concerns about their environmental cost.
Regarding returns, “if you have something in our world that is shipped internationally, one wonders if it would cost more and be more harmful to the environment to ship it to its origin. “, did he declare. the focus was on returns to find other locations closer to where the delivery was to be returned.
Retailers can also limit the environmental cost of returns by ensuring that customers don’t want to return their purchases in the first place.
“At the end of the day, I think any e-merchant is looking for a way to minimize the need for feedback by having precision up front and really making sure that the product they are delivering to the consumer is what has been. requested and required, and therefore doing so in the most efficient manner, “said Hewitt,” and on the transportation side, bringing it as close as possible to minimize the use of any fossil fuels. “
Also helping to have an environmental impact is to find ways to reduce the amount of packaging.
“You are looking for ways to use different materials that are more durable in nature in order, at the very least, to do less harm to the planet,” Hewitt said.
Grace is an associate editor for Yahoo Finance.
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