Green Logistics

The concept of green logistics refers to supply chain practices that strive to reduce energy and environmental footprint in terms of freight distribution. More specifically, it focuses on materials handling, waste management, packaging, and transportation. While green logistics encompasses a wide variety of dimensions, companies that focus only on one specific dimension can still be implementing green logistics. For instance, one firm may be looking to reduce the amount of packaging materials while another firm may be looking into using alternative fuels. In both instances, each firm is attempting to implement a green logistics strategy ⁽¹⁾.

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Contents:
1. Brief History
2. Issues
3. Benefits
4. Conclusion

Brief History
Green logistics became increasingly popular over the last couple decades as the general public’s awareness of environmentally harmful practices came to light. In particular, the transportation industry was deemed a large contributor of environmentally unfriendly impacts. Companies are striving to reduce transportation’s environmental impacts in terms of its infrastructure, modes, and traffic flows ⁽¹⁾. The growing interest of the environment in the field of logistics brought about a new market opportunity: reverse logistics. Reverse logistics involves the reverse distribution of waste and used materials. This allows firms to recycle and reuse materials in order to lessen their environmental footprint ⁽²⁾.

Issues
Implementing green logistics results in a number of contradictory issues. Timing is a critical component of any logistics system. The increased demand for door-to-door services and just-in-time strategies ultimately leads to an increase in environmental impacts. These demands require the use of more air and truck transportation, which reduce energy efficiency and cause high pollution levels. Another contradictory issue involves reliability. The least polluting modes of transportation are generally the least reliable in terms of on-time delivery, lack of damage, and safety. Logistics systems are focusing on reducing inventories in order to reduce costs. However, this will require more in-transit inventories, thus further contributing to more pollution ⁽²⁾. These are some challenges that firms face when looking to implement a green logistics system.

Benefits
Firms are attempting to overcome such challenges through the use of different strategies. A green logistics system must start at the source, and therefore must be considered during initial product development and raw material purchasing stages. For instance, companies can choose local suppliers in attempt to reduce transportation and environmental costs. Also, contracting with suppliers that procure their materials in a sustainable manner can lower a firm’s environmental footprint ⁽¹⁾. As product components are becoming recyclable, companies can start to use recycled materials in manufacturing and production. Sustainable logistics provides benefits to the economy, society, and environment.

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Conclusion
As mentioned earlier, developing reverse logistics further can result in lower environmental impacts since materials and components can be reused ⁽²⁾. Applying a green logistics system to any supply will require a substantial amount of research, planning, and risk-analysis. There are a number of issues that may affect service performance and logistics costs if a green system is implemented. However, a reduction in environmental impacts is beneficial to all consumers. The concept of green logistics should be at the source of a firms supply chain strategy.

Sources:

1. http://people.hofstra.edu/geotrans/eng/ch8en/appl8en/ch8a4en.html
2. http://www.greenlogistics.org/otherpublications/presentations.htm
3. http://www.otsukawh.co.jp/english/env/target/

FS12_Team12 (11/20/12)