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Supply chain sustainability is about managing the environmental, social, and economic impacts within supply networks. It involves adopting practices that reduce negative environmental effects, promote fair labor practices, and contribute positively to the communities involved in the production and distribution processes.
Optimally, sustainable supply chain management will create long-term value by balancing economic performance with environmental and social stewardship.
There are an increasing number of reasons why sustainability is crucial for modern supply chains.
Firstly, the demand for sustainable products by consumers is rising. A recent study by McKinsey and NielsenIQ1 discovered that products that make sustainability claims outperform the competition:
The study also found that brands with sustainability claims grow faster than the competition:
In addition to better sales and overall growth, sustainable brands have more loyal customers. Brands with more than half of their sales from sustainable products saw 32-34% repeat purchase rates, compared to under 30% for brands with less than 50% of sales from sustainable products.
Businesses like Walmart have adopted thorough methods for assessing and guaranteeing the sustainability of vendors. This means that vendors and suppliers who want products on Walmart shelves must have sustainable supply chain practices.
Walmart has exceptionally high standards relative to other companies, but the trend of retailers adopting sustainability requirements continues to grow.
New sustainability standards are being implemented across the world.
In the US, the SEC recently implemented its Climate-Related Disclosures. In the UK, the Corporate Sustainability Reporting Directive is being phased in. And President Xi Jinping has stated that China is committed to achieving carbon neutrality by 2060.
New sustainability regulations will continue to be adopted as nations become aware and concerned about environmental and ethical labor issues. These regulations affect all businesses that work with international suppliers.
That’s why we regularly update our retail sustainability guide with the latest regulatory information.
Sustainable sourcing prioritizes finding materials that are environmentally friendly and ethically produced. These actions must span across all vendors and manufacturers for a truly green supply chain.
We’ll take you through a few key steps to sustainable sourcing to help simplify the process.
The journey toward sustainable sourcing begins with a thorough understanding of materials that are environmentally conscious. These materials will vary by industry, but some examples include renewable resources like:
Recycled materials also play a crucial role in sustainable sourcing efforts. By utilizing recycled plastics, metals, or paper, businesses can help divert waste from landfills and conserve natural resources. Additionally, prioritizing biodegradable materials that can decompose naturally without harming the environment further contributes to sustainability goals.
Collaborating with suppliers who share a commitment to sustainability is paramount in building a truly green supply chain.
Evaluating suppliers based on their environmental policies, practices, and transparency regarding material sourcing is essential. Regular audits and site visits can provide valuable insights into supplier sustainability efforts, ensuring alignment with your company's goals.
Surefront’s Vendor Management System (VMS) makes this particular process simpler. You can manage vendor compliance on a shared platform:
We’ll get into these functionalities in more detail later. All you need to know now is that Surefront makes monitoring and assessing your vendors turnkey.
Evaluate and monitor suppliers to ensure workers are paid fairly, working reasonable hours, in a safe environment, and are not being discriminated against.
Surefront’s VMS is also useful in this process because you can build a custom questionnaire with customizable fields and attachments for images. This allows you to evaluate vendors to your specifications and satisfaction. It makes it easier to build and maintain an ethical supply chain.
Navigating the complex landscape of sustainable materials is made easier by relying on certifications and standards established by reputable organizations. A few well-known certifications include:
These certification bodies provide assurance that materials have been sourced and produced in a sustainable manner.
Eco-labels, such as USDA Organic, Fair Trade, or Blue Angel, are visible markers of sustainability and ethical sourcing practices. These labels help businesses make informed decisions and instill confidence in consumers who prioritize sustainability when making purchasing choices.
Automating supply chain sustainability with Surefront
We’ve developed new technologies to automate supply chain management. Chief among these technologies is our custom questionnaire.
The custom questionnaire allows businesses to evaluate various aspects of their supply chain, including labor conditions, safety standards, fire standards, and contamination standards—giving businesses deeper insights into vendor operations and ensuring compliance with sustainability and ethical sourcing requirements.
Unlike generic form-building tools like Google Forms, Surefront's custom questionnaire feature is specifically designed for supply chain management purposes. It offers advanced functionalities:
The questionnaires reside on Surefront’s shared platform, allowing you to distribute them to numerous vendors effortlessly—tailoring fields to vendor categories or specific vendor needs. Standardizing everything on a shared platform means questionnaires can be viewed, queried, and combined to form larger, more complex assessments
You can also monitor in real-time as suppliers work on questionnaires, commenting on improperly filled-out items and requesting additional verification via attachments when needed.
Surefront's custom questionnaire allows businesses to assess vendors and products on sustainability and compliance.
For Vendors, you can include questions about labor and factory conditions. You can also require pictures and certifications for additional verification.
On the product side, Surefront comes pre-built with comprehensive product information management tools and fields. You can leverage our flexible fields to include product questions about material sourcing and production practices.
These features give you unparalleled transparency into your supply chain.
Sustainability is a topic that must be taken seriously by modern supply chain businesses. Here’s some of the key things we’ve learned about sustainability in this article: