Friday 21st Oct 2016 - Logistics Manager

The Supply Chain will have to change

The past couple of weeks have seen the leaders of two of the world’s largest retail groups taking the opportunity to set out their social and environmental credentials.

First Wal-Mart boss Lee Scott has called upon his rivals to work with Wal-Mart to create a framework of social and environmental standards for sourcing of goods.

Then Tesco chief Sir Terry Leahy used the Roland Smith Lecture to declare: “Our aim is to create a mass movement in green consumption.”

Sir Terry argues that consumers control over 60 per cent of direct emissions of greenhouse gases – and even more indirectly, through what they buy and other choices.

“In the retail sector, up to 90 per cent of emissions come from the supply chain, not direct retail operations. But if people feel bullied into going green, they will see red. They won’t change. And everyone will suffer.”

Action on some of these issues is already starting to build up. There are plenty of examples of trials of alternative fuels while warehouse developers are increasingly emphasising the environmental efficiency of their sites.

Sir Terry points out: “Last year we cut emissions in our distribution network by around 20 per cent. This year we’ll meet our target to halve the average energy use in our UK buildings– two years early. The amount of energy we use in existing buildings will be half that used in 2000.”

And, he says: “If customers are given more information about products’ carbon footprints, I believe their behaviour and choices will change – and the supply chain will have to change too. As suppliers cut their emissions, the bloodstream of the entire supply chain will begin to turn green.”

These are radical thoughts suggest action so far is little more than a precursor to the main event. And there is something ominous about the statement: “The supply chain will have to change too.”

The chattering classes can chatter, politicians can pontificate, and campaigners can be a pain. But when the big beasts of the retail jungle start shouting the odds, you can be sure that change is going to come sooner rather than later.