Hitting the Tipping Point: Managing the Intersection of Supply Chain & Sustainability

"Sustainability" is more than just a buzzword for many businesses today; it is a necessary means of operation. Studies show that nearly 60 percent of all consumers are willing to change their purchasing habits to reduce their personal environmental impact, while more than 70 percent stated that they'd be willing to pay a premium price for brands that are more sustainability focused.

Consumer willingness has led to growth in Environmental, Social, and Governance (ESG) investments, which have reached more than $35 trillion globally and are expected to continue to grow. With this escalation, sustainability will be an essential factor in purchasing decisions for consumers. Other concerns include global climate shift, strained resources, and changing regulatory standards.

For many businesses, blending operational efficiency and environmental responsibility is the answer to meeting sustainability goals. Daifuku Intralogistics is here to help. As world leaders in designing and manufacturing the industry's best automated material handling solutions, we know that the future of logistics lies in building more intelligent, more sustainable systems.

Read on to learn more about the role that intralogistics plays in helping all types of organizations meet their environmental targets, while maintaining speed, flexibility and cost-effectiveness:

Daifuku's Supply Chain Mantra

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Let’s take a closer look at supply chain management and how it can contribute to a sustainable society.

While Daifuku abides by a basic supply chain policy, we've also developed and followed Sustainable Procurement Guidelines to promote further change throughout the supply chain and strengthen our resolve. A significant part of our Sustainable Procurement Guidelines is our green procurement initiatives, which help evaluate the standards we abide by for any chemical substances in our products. Everything we source (parts, packaging, etc.) is assessed as part of this initiative as a means to minimize the amount of hazardous substances Daifuku and our customers interact with regularly.

It's all a part of how Daifuku aims to create both social and economic value by developing solutions and building a business ecosystem that is both good for business and good for the environment. Before you can adopt specific solutions to help transform your operations for the better, it's essential to rework your standards and guidelines to ensure that your supply chain is optimized.

Some practical implementation steps to bridge the gap between your supply chain and sustainability include:

• Map your supply chain and identify areas of improvement.

• Establish metrics and KPIs to define environmental impact.

• Make sure you're selecting suppliers based on your established sustainability metrics and KPIs.

• Optimize your transportation networks to maximize efficiencies and eliminate waste.

In addition to promoting a more sustainable business, following these steps can also result in cost savings, perhaps by as much as 20 percent, compared to businesses that remain stagnant.

How Intralogistics Can Help

Many innovations are helping to manage the intersection of supply chains and sustainability by making operations smarter, faster, more sustainable and more cost-effective.

The Rise of the Internet of Things (IoT)

The Internet of Things has revolutionized logistics by enabling enhanced visibility and control over supply chain operations. Thanks to smart sensors and advanced analytic platforms, companies have real-time access to data, which can help unlock sustainability improvements and ensure operations remain agile and ready to adapt and evolve more quickly.

Automation

Warehouse automation is helping transform modern-day warehouses into more sustainable operation centers. The rise of automated storage and retrieval systems (AS/RS) can help warehouses reduce energy consumption by continuing operation in dark spaces so the temperature can be ambient. It's estimated that AS/RS solutions can help reduce energy consumption in the warehouse by up to 45 percent compared to conventional facilities simply by their unique ability to operate in dark spaces that don't require climate control.

Other benefits of AS/RS systems and more automated operations include enhanced storage capabilities, which reduce the need for larger facilities that demand more energy. Such systems also increase safety, reduce labor costs and scale easily.

Daifuku developed the first AS/RS system in 1966 and has continuously improved this innovation since, helping warehouses automate manual processes and experience the many benefits of doing so, including increased efficiencies.

Artificial Intelligence

Artificial intelligence continues to evolve, and it's driving transformative changes in supply chain management as it does. AI tools can quickly analyze massive data sets to help warehouses learn patterns and optimize just about every task, from inventory management to demand forecasting.

Thanks to AI's ability to quickly uncover patterns, managers can more proactively adjust their operations to maintain high service levels and create new competitive advantages. AI can also help businesses automate complex decisions, which improves accuracy and helps streamline tasks such as order fulfillment, routing and restocking. This can help improve efficiency and sustainability, all while delivering a high level of service and promoting an operation that can respond to customer demands more quickly.

Robotics

While robotics in warehouses isn't new, their capabilities are. Today's robots can do so much more than the robots of yesterday. Previously, robots were often confined to performing only a single function in such environments. Today however, they can pick, pack, sort and more — and these operations can be optimized in real time by learning from data and adjusting workflows accordingly, thanks to further integration with AI.

Similar to the benefits of AI in general, AI-powered robots can improve efficiency, reduce unplanned downtime, and create warehouses that run more productively. This makes for an improved overall work environment. AI is revolutionizing the material handling industry and its adoption with robotic solutions is just one example.

To learn more about how supply chain management contributes to sustainability, and how Daifuku’s systems can support these efforts, we invite you to explore our available resources. Our team can assess current operations and recommend appropriate solutions to help meet sustainability objectives. We also provide guidance on navigating the challenges associated with implementing new technologies and aligning with relevant sustainability policies. As environmental considerations increasingly influence consumer behavior and business strategies, understanding and addressing sustainability within your supply chain is essential.

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