For years, warehouses have been among the most monochromatic buildings imaginable. But figuratively speaking, that's about to change. Like the rest of the world, many DCs (distribution centers) are aiming to go green.
Some, like U.K.-based retailer Sainsbury's new facility in Northampton, are already well on their way. Constructed with a large number of eco-friendly special features such as solar walls, on-site recycling, and a heat-reducing power plant, it's said to have Europe's lowest carbon footprint for a facility of its kind. But most - especially those constructed before the sustainability movement hit its stride - still have their most environmentally friendly days ahead. The question is can they become more sustainable without forcing their occupants to break the bank?
The Science Of Green
Fortunately most logistics experts say yes.
Although they're divided as to whether or not sustainable DC building materials cost more up front - with some saying they add as much as 7 percent to the cost of new construction, and others saying green materials are really no more expensive - industry professionals largely agree that many eco-friendly construction initiatives and improvements more than pay for themselves in the long run. So do many specialists in lean-and-green logistics engineering techniques.
"When my employer began ramping up its sustainability initiatives, I thought we'd be faced with a lot of tough choices between economy or eco-friendliness," says logistics engineer Dr. Rajiv Saxena. "But as we've progressed, I've been pleasantly surprised to discover that much of good logistics engineering is not only compatible with greener business practices, it's actually synonymous with it."
Nowhere is this principle more evident than in the area of facility location selection. A vast majority of companies' supply chain costs have always been tied to the "where" of their warehouses - with remote locations driving transportation costs higher because they require trucks to travel longer routes, and centrally located facilities keeping costs down for the opposite reason. But as it turns out, well-situated DCs are equally attractive from a carbon footprint perspective - because the fewer miles trucks and trains must travel to reach them, the less of an environmental impact a company makes.
"If you do only one thing to make your DC operations greener, optimize your warehouse network often to make sure it's running as efficiently as it should," advises Saxena. "Your warehouses' venues are either going to be a big part of the sustainability problem or a big part of the solution."
Be sure to optimize your facilities' layout as well. The average facility forklift logs numerous miles every year, and whether it's using gas, propane, or electricity, simply shortening the journey from your most popular products' slots to the dock can significantly reduce its energy requirements - and ultimately your company's carbon footprint and overall expense.
And look closely at the average throughput of your facilities. If trucks have to spend even a few minutes idling outside one of your DCs while they wait for a dock, they're burning a lot of unnecessary diesel fuel - a sure sign you may need to do the environment a favor and revamp your facility's delivery scheduling.
Conducting these optimizations typically requires sophisticated IT tools as well as professionals who know how to use them properly - not to mention some degree of flexibility about being able to relocate or redesign warehouses if necessary. By contrast, many other sustainability activities are considerably less cerebral - and more tactical - a fact that may explain why they're being more readily embraced by some companies.
For example, there are many benefits to be derived simply by revamping the lighting in your facility. A shift to more current fluorescent lighting technologies could help reduce your light-related electricity requirements by as much as 70 percent. And you could reduce your consumption even further by placing motion sensors or timers in key areas of your warehouse to trigger lights to turn on only when people are working there.
Comparable controls are available for heating and cooling functions so they can be more closely tied to what's actually taking place within the warehouse. When coupled with what should be standard maintenance procedures such as making sure docks are properly sealed, this can help promote significantly more efficient climate control - as can using lighter-colored roofing and paving materials (said to reduce a facility's heat island effect) and investing in higher-quality insulation materials.
It's a Breeze
Of course, not all green DC initiatives focus on reducing energy consumption. Some are focused on creating energy from what's already readily available - sun and wind. For example, many newly constructed DCs are increasing their use of skylights and windows so they can use natural light in many parts of their facility. And those that are especially visionary are placing solar panels on portions of their roofs, an ideal scenario since warehouses are so flat.
Although the cost of implementing solar power is still substantial (some would say unfeasible), some states such as California are offering significant rebates or tax incentives that could trim the initial expense by as much as 50 percent. And, in Europe, at least one warehousing construction company has found a way to recoup some of its costs by selling some of the solar electricity it generates back to the power grid.
By the same token, some shippers are taking a page from Bob Dylan's book to see whether their answer to more sustainable warehouses is "blowin' in the wind." Several major retailers and manufacturers are either experimenting with, considering, or deploying wind energy to help power portions of their DCs.
According to the American Wind Energy Association, the cost of electricity from this clean power source has dropped by more than 80 percent over the past two decades, with more cost improvements still to come as technology improves and more wind power plants are constructed. However, the up-front expense for the turbines and other materials needed to get started is still steep and has actually gotten higher in recent years.
Finally, some green warehousing initiatives aren't focused on energy at all.
"There's no doubt that the rising demand for fuel and its escalating cost have accelerated some companies' desire to conserve energy," says Saxena. "But there's a lot more to having a green warehouse than just reducing gas and electric bills."
One notable example is water use. Many areas of the United States have been experiencing severe droughts, prompting some companies to install stormwater retention and irrigation techniques for their landscaping or to incorporate Xeriscaping principles such as drought-resistant shrubs around their warehouses.
Companies also are focusing on using more recycled materials for warehouse construction or equipment - and on reducing their own contributions to landfills by doing a better job of forecasting how much inventory they actually need. And they're considering the importance of inner air quality - a subject that also has productivity and employee-retention ramifications.
"Most aspects of doing greener business in the supply chain truly are related to greater productivity, which is always a goal of supply-chain management," says Saxena. "At this point of the journey, focusing on sustainability has much to offer us all."
Think Outside the Box
Needless to say, greening warehouses is just the tip of the iceberg when it comes to companies' sustainable supply-chain initiatives. The typical supply chain is full of countless moving parts, and all of them - including warehousing - have to be evaluated as a whole in order to truly understand and improve upon their environmental impact.
For example, although it may look like it's more productive to reduce the inventory coming into a warehouse in order to reduce your company's footprint, it's a counterproductive decision if it means you'll wind up using more rush air shipments from your factory in order to avoid running out of stock - because air has the largest global footprint of any transportation mode.
Additionally, if you choose to reduce the number of facilities you operate, you might end up conserving some electricity and water. However, you could burn considerably more fuel if it means you've eliminated a warehouse that's a key cog in your wheel.
In short, you can't engage in silo thinking. Nor can you take a short-term view. If for some reason your DC ownership or leasing situation is such that it doesn't make fiscal sense to "green" your warehouses now (perhaps you have just a few more months before your lease expires, for example), it may be prudent not to make improvements until you're certain you're going to stay there or until you move to a new facility. This is especially true because many sustainability investments take three to five years to pay for themselves. Meanwhile, you can always focus on other high-yield sustainability initiatives in other parts of your supply chain such as:
Load building: As a rule, the better you're able to cube your trailers and ocean containers during loading, the less protective packaging (i.e., waste) you'll need - and the fewer shipments you'll need. Fewer shipments equal less consumption.
Mode selection: Want a smaller carbon footprint? Use ships instead of planes, since they're about 96 percent greener. And use trains instead of trucks; according to the Environmental Protection Agency, this can cut your fuel use and emissions by almost two thirds.
Container size: If you ship internationally, bigger containers are usually better if you have enough cargo to fill them. Generally speaking, you can fit the contents of three 40-foot containers into one 53-footer, making more room on a vessel and requiring fewer truck moves when your shipments reach land.
Internal cooperation: Does your company have multiple divisions or departments? If so, do you all use the same supply chain? Or might there be opportunities to consolidate supply-chain operations, optimize them, and eliminate a considerable amount of redundancy? After all, waste doesn't just happen with products.
Last but certainly not least, you can take the time to study up on some promising and helpful industry initiatives. From the U.S. Green Building Council's LEED program (www.usgbc.org) to the EPA's SmartWay Transport Partnership (www.epa.gov./smartway), there are many ways you can get a good view of the best practices at work today so that you can begin to map out your green strategy for tomorrow.
And rest assured, there will be a tomorrow. Green may be the hottest topic going today. But unlike other trends, it's not a fad. Like globalism and heightened security, it's going to be an enduring part of how we all do business on a go-forward basis.