Whether your business provides products or services, your supply chain is at the heart of brand and business success. Each stage of your supply chain can impact on all three aspects of the “triple bottom line” — profits, people and the planet. It’s up to you to minimalize any negative impacts. This is where supply chain sustainability comes in.
Managing the social, environmental, and economic impact ofyour supply chain should be a priority for your business, assuming you want to achieve long-term success. Not only do you need to comply with sustainability legislation and environmental regulations, but the sustainability of your supply chain can also affect your business’s profitability, work opportunities, professional relationships, and reputation.
So, if you’re looking for a reason to make your supply chain more sustainable, I’ve outlined the biggest business benefits of doing so.
Mitigate Risks across Your Supply Chain
Every business faces a huge number of risks, which it needs to manage. By taking a look at your sustainability, you can manage and mitigate different types of risks across your supply chain. Ultimately, sustainability is about making sure your supply chain can overcome whatever risks or threats are thrown at it. It’s about business continuity.
Improving sustainability involves carrying out risk assessments of the different processes involved in your supply chain. You’ll need to identify risks and possible scenarios that could harm or negatively impact people, the environment or the financial health of your business, and implement effective control measures to mitigate or control these risks.
Becoming more sustainable will also involve assessing workplace health and safety, environmental management, your business finances, reputation, compliance and more. So, supply chain sustainability ties directly into how you mitigate risks across the different areas of risk management.
Protect Your Business from Reputational Damage
A lack of sustainability can lead to serious reputational damage to your business. If you don’t minimise the environmental and social impact of your supply chain, your business may develop a reputation for negatively impacting the lives of employees and local communities and carrying out processes harmful to the environment. In the current digital age, news spreads faster than ever before and reputational damage can quickly spiral out of control. Managing the risk of reputational damage has never been more important.
Making your supply chain as sustainable as possible can protect your business from this reputational damage and boost your professional standing. Sustainability and the resulting good reputation are key when it comes to gaining customer trust, increasing customer loyalty and marketing your business. By going above and beyond complying with sustainability legislation, you can set your business apart from competitors, and word about your sustainability efforts is likely to spread and attract more customers or clients.
Open Doors to New Partnerships and Work Opportunities
By prioritising sustainability, you can increase your business opportunities by appealing to conscious customers and clients. With awareness of environmental and social issues on the rise, many people are choosing to support and work with businesses that have made their supply chains as sustainable as possible. Many business tenders will also require firms to demonstrate their commitment to sustainability through accreditations such as ISO 14001 (the international standard for environmental management systems).
In addition to helping you meet the expectations of customers and clients and land more work opportunities or sales; supply chain sustainability can also help you secure valuable partnerships with other organisations. This is because making supply chains sustainable involves not just monitoring and improving your business processes. It also means making sure any other businesses you work with are on board with your mission to reduce negative environmental, social and economic impacts. So other companies with sustainability at the core of their brand values will usually only consider partnering with businesses that share their ambitions regarding sustainability.
Supply chain sustainability can set your business apart from your competitors and lead to more sales or work opportunities and partnership possibilities, ultimately increasing your profitability.
Improve Employee Satisfaction, Retention and Recruitment
It’s not just customers, clients and potential partners that are invested in your supply chain sustainability. Many employees also feel happier in roles within businesses that are environmentally, socially and economically responsible — and happy employees are likely to be more productive and loyal to your company.
Employees often want to work in roles that have a positive impact on others. Environmental and societal considerations allow employees on all levels to feel motivated by a higher sense of purpose. When employees feel like they can make a difference in their role and work towards issues they also care about on a personal level, they’re more likely to stay with your company long-term. And during the recruitment process, the sustainability of your business and supply chain can also attract new eco and socially conscious talent.
Cut Back on Business Costs
A common misconception is that improving supply chain sustainability is a costly process. But actually, the opposite is true — sustainability can save your business money and improve your profitability.
Exactly how you implement sustainability in your supply chain will depend on your business operations, but let’s say you were to swap out energy-guzzling equipment and appliances for eco-friendly alternatives. You’re not only going to reduce your environmental impact, but you’re also going to save on your business utility bills.
Similarly, if your business needs to dispose of a lot of waste, landfill fees and taxes can be unwelcome overhead costs. Recycling waste can help you cut back on those costs. Environmental risk management also involves carefully calculating the number of materials needed, so you can improve your supply chain sustainability by reducing waste. It can also help you save on disposal fees.
There’s also the cost of non-compliance to consider. If your business fails to comply with sustainability legislation, you may face legal fees and penalties. By making specific environmental, social and economic responsibility is considered across your supply chain, you can avoid any costs of non-compliance.
Guest Blogger – David Lamb
David Lamb is a Digital Marketing Manager at CHAS, the UK’s leading provider of risk mitigation, compliance and supply chain management services. David has helped thousands of companies make the decision to join CHAS and achieve regulatory compliance, improve health and safety standards, gain cost-effective accreditation, create new business opportunities and minimise supply chain risk.
Header Image: Thanakorn.P – Shutterstock