The hidden costs of selling online
According to Retail Supply Chain Sustainability Report, who surveyed 500 Australian consumers, 60% of us often receive orders online in multiple shipments.
More vehicles on the road result in more traffic, more idling and more carbon emissions, according to the report, which was released by Manhattan Associates, Shippit and Greener.
For the report, e-commerce shipping experts, Shippit collected data from deliveries spanning more than 2.2 billion kilometers across Australia to measure the amount of carbon generated by its courier partners as of when a package is collected until it is delivered.
These deliveries contribute about four thousand tonnes of carbon emissions, or the equivalent of the emissions produced by about 1,600 cars on the road, according to Greener, an app launched next year that provides recommendations to consumers on which companies sustainable business practices are a priority.
The report’s alarming findings for retailers show how important it is for warehouse, fulfillment and logistics infrastructure to innovate to keep up with increasing consumer demand for online shopping without increasing the waste.
The good news is that there are many benefits for businesses that can leverage more sustainable logistics practices. For example, research from Manhattan Associates shows that 63% of Australian consumers would pay extra for an environmentally friendly delivery service.
However, changing consumer expectations and the status quo in delivery are neither straightforward nor straightforward.
“The vast majority of consumers still want orders delivered quickly,” says Sibal.
“But more and more retailers are giving consumers choice. Some people may still want their orders delivered immediately.
“Others might make different choices about how their goods are delivered if they are made aware of the hidden cost of carbon emissions involved in choosing fast delivery options.”
Technology is the key to a more sustainable supply chain, including systems that give companies visibility into their inventory to make deliveries more efficiently. This includes orders shipped in a single shipment, rather than multiple shipments, as reducing unnecessary shipments will in turn reduce transportation operating costs, packaging costs, labor costs and , above all, the environmental costs.
Super Retail Group (SRG) is a company that has introduced more environmentally friendly practices into its supply chain and has reaped the rewards.
With new systems, including an order management system from Manhattan Associates, SRG was able to reduce fulfillment costs by double digits. Online sales increased 87% in six months and split-order shipments fell 24% in 12 months.
Commenting on the trend towards a more sustainable supply chain, National Retail Association CEO Dominique Lamb said consumers are starting to flex their wallets, using their power at the checkout to drive positive environmental outcomes. .
“They want to see their values reflected in the brands they engage with, including brand views on sustainability,” says Lamb.
“It’s not just about how much plastic our products are packaged in, it’s about what they do with their supply chain. So, for retailers, it’s a no-brainer.
She says consumers often spend 40% more when they feel their values are reflected in a brand.
“We also know that when a brand gets it wrong and doesn’t apologize, a consumer stops shopping with a brand for six months,” she says.
“It has become an essential decision for our retailers. Having their values reflected in a brand’s approach to sustainable development is now essential.
To access the full research report on Sustainability in the Retail Supply Chain and to learn more about Manhattan Associates, please visit www.manh.com/en-au/resources/research-report/sustainability or contact Manhattan Associates [email protected]