Sustainability

Did you know that inventory optimization can lead to a more sustainable supply chain? In fact, based on research generated by City University of London, warehouse management accounts for about 13% of all supply chain-related emissions. Manufacturing plants consume energy due to heating/cooling & storage requirements. Your industrial factories are presently emitting a specific quantity of carbon related energy outputs, including the global distribution centers that deliver your produced goods. By deploying predictive analytics, your entire company can reap the benefits of global waste minimization. For example, increased visibility can improve your responsiveness to sudden customer demand changes and prevent over-stocking as a result of supplier shortages. It is vital to have the ability to foresee these impacts, including how competitive promotions and sudden price changes can affect inventory management levels and transportation utilization. Vizen’s planning software quantifies the amount of contributing waste and CO2 emissions generated by your supply chain operations, such as calculating the effects of excess goods inventory and fleet fuel utilization. Our cloud SaaS tabulates the precise category reductions produced from your forecast improvements.

It’s estimated that between 5.5% and 13% of the global GHG emissions are caused by logistic activities in supply chains. – City University of London

In today’s brave new world, a sustainable supply chain holds the key to your future growth while building positive customer perceptions as well. According to industry consultant Capgemini, an AI-driven supply chain solution can help you meet up to 45% of carbon reduction targets and eliminate unnecessary wastage. Enhanced planning can also reduce your carbon footprint via the increased accuracy of future order projections, thereby re-tuning your logistic outputs. It also generates a strong ROI, as demand sensitive forecasting enables better alignment to what your customers want, increasing sales of items in stock and reducing products that do not sell as rapidly. Additionally, enhanced inventory optimization helps avoid stock-outs, and ignites operating margins.

By utilizing a sustainable supply chain practice, your organization will begin to achieve better value performance and increase efficiency results. The goal is to mitigate the over-purchase of products, especially those items with a lower shelf life including raw ingredients like almond flour or black truffle oil. The automotive industry learned this lesson the hard way, when floods in Thailand brought a halt to their supply flow, idling factories around the world and creating an inventory glut. Later, they started collaborating more closely with their key suppliers and now have a more diversified supply chain. Ineffective supplier relationships can compromise sustainability as a result of bloated inventory purchased to hedge against market disruption and future deficits. This explains the need for developing the right approach to ensure that the optimal stock is always on hand to fulfill what your customers will purchase at the time they want it. It becomes possible once an advanced solution is successfully implemented, accounting for real-time tracking to prevent excess waste, and it lessens your CO2 footprint. In summary the benefits of a sustainable supply chain include:

• Increased operational efficiency
• Reduced environmental impact
• Decreased inventory expenses
  
• Improved customer perception