Net zero, carbon emissions and sustainability are well used daily terms across the business landscape and in the media. This is a positive thing, and long may the conversation – and action – around reducing our impact on the environment continue and build for individuals, businesses, the government and other official bodies. 

Businesses large and small are taking steps to run more sustainable operations, whether forced due to regulations or voluntary, but in either case, the stumbling block in such activities is often the supply chain. Not only does the greatest environmental footprint usually lie within this space, but when there is a lack of data and transparency it can present a major hurdle. When businesses aren’t clear on the origins of their footprint, it becomes much harder to manage and reduce.

The business sector status quo

The UK’s business sector – which accounted for 18.7% of greenhouse gas emissions, or 61.9 million tonnes of carbon dioxide, in 2022 – must play a major and sustained part in the race to reach net zero by 2050. It follows, then, that supply chain businesses need to play a prominent part in driving this.

Requirements around emissions are far from uniform. For example, some larger organisations in the UK need to disclose Scope 1 and Scope 2 emissions, in line with the government’s Streamlined Energy and Carbon Reporting (SECR) framework. Depending on the sector, others may be impacted by extended producer responsibility (EPR) if they handle packaging, and companies with EU operations may face governance challenges through the Corporate Sustainability Reporting Directive. A growing number of organisations are also disclosing emissions data voluntarily through frameworks such as the Science Based Targets initiative (SBTi).

With the tide heading irrevocably in the direction of greater reporting requirements, larger businesses are reviewing their supply chains in order to report on Scope 3 emissions, where the largest part of this footprint is likely to be. As legislation broadens, smaller enterprises will follow.

Therefore, for businesses within these supply chains, there is an urgent need to throw a spotlight on their own operation and be clear about its environmental impact. Usually, a lack of transparency doesn’t stem from an unwillingness to share data but is instead due to uncertainty around where to start. However, by not taking a proactive approach to sharing and reducing their footprint, these suppliers risk losing out on business to a growing number of competitors that do.

Where to start on the journey

The initial focus for any organisation seeking to reduce their impact on the environment is to look inwards to measure and reduce Scope 1 and 2 emissions. This includes emissions made directly by the firm, for example through its fleet of vehicles, using the boiler, or the energy it purchases for heating its offices or powering its machinery. 

Once measured, businesses can assess where the greatest emissions are produced and make appropriate adjustments. Changing supplier, improving recycling processes, finding energy-saving solutions – such as more efficient appliances and light bulbs – or implementing energy reduction policies in the workplace can all reduce operational emissions.

Scope 3 emissions are next, but these are far more challenging to monitor because the business is not directly responsible for them, and can occur up and down their own supply chain. Even suppliers need to choose to work with organisations that prioritise sustainability and transparency.

Supporting preservation

For proactive businesses that have done all they can to address Scope 3 emissions but are perhaps aiming for net neutrality, offsetting is a good approach to take.

In this sphere, businesses often opt for tree-planting schemes to offset the carbon the business is emitting with new trees that will remove this carbon from the atmosphere. Trees can absorb around 21kg of carbon dioxide every year, meaning that one acre in a forest can absorb double the amount of CO2 produced by an average car in a year. However, this level of carbon absorption can only reliably happen once the tree is mature, around ten years after it is planted.

Another option is forest preservation in favour of planting trees, to protect the forests that are already at work absorbing carbon dioxide and the delicate ecosystems within them.

In addition to absorbing carbon, these trees retain it throughout their lives. This is why deforestation is the cause of approximately 10% of global carbon emissions. The process released stored carbon back into the atmosphere. Moreover, deforestation often occurs to clear land for uses that further contribute to global carbon emissions.

Preservation also protects these habitats that have formed over millions of years to create finely balanced ecosystems that are irreplaceable, alongside the species that inhabit them. There are many reputable schemes that businesses can consider supporting or partnering with to protect our rainforests, such as Rainforest Trust and Amazon Conservation.  

Sustainability is good for business

The Environment Journal reports that 69% of CEOs view sustainability as a growth opportunity, whilst Business Reporter shares that one third of UK business leaders report that sustainability action is already having an impact on their companies’ revenue, profitability and growth.

The business incentive goes beyond the urgency of climate action, and there are a growing number of resources available to support businesses in their journey, including the UK Business Climate Hub for SMEs, or certifications such as becoming a B Corp. 

As sustainability and environmental responsibility take centre stage, regulations like the EU’s Deforestation Regulation (EUDR) are poised to reshape how businesses manage their supply chains. 

From December 30, 2024, companies importing, exporting, or selling certain “forest-risk” products within the EU will need to comply with stringent requirements. This will involve organisations ensuring their products are “deforestation-free” or face significant penalties.

What is the EUDR?

The EUDR aims to reduce global deforestation by making companies accountable for tracing the origins of “forest-risk” products. These are products that originate from land where there is a risk of deforestation. Examples include cocoa, coffee, rubber, cattle, and wood. Under the EUDR, businesses can only sell these products in the EU if they are prove they are deforestation-free.

Why does it matter?

The scope of the EUDR is broad, covering a wide array of goods. These range from foodstuffs like cocoa and beef to everyday consumer products like wooden furniture. To comply, businesses will need to demonstrate that any land used to produce these products has not been converted from forest to agricultural use since December 31, 2020. Not only that, but they must prove that all production is in line with local laws.

Ensuring supply chains meet these standards will require a high level of transparency. 

Comprehensive supply chain due diligence is necessary to ensure that businesses can verify their products’ origins. Companies will need to provide geolocation data, identifying where their suppliers produced the commodities. If a batch of goods is found to contain products from deforested land after the cut-off date, the entire batch could be deemed non-compliant.

The challenges ahead

Implementing these changes poses significant challenges, particularly for businesses with complex or global supply chains. Tracing every plot of land linked to a product’s origin requires detailed information that may not always be readily available. There have been calls for the European Commission to delay the EUDR over concerns about readiness. Nevertheless, the regulation will take effect as scheduled.

The consequences for non-compliance are steep. Businesses may face fines of at least 4% of their total annual EU-wide turnover, as well as confiscation of non-compliant products or revenue from their sale.

What can organisations do now?

To prepare, businesses should begin assessing their current due diligence systems and mapping their supply chains to identify in-scope products and suppliers. Companies can use traceability software, digital tools like Geographic Information Systems (GIS), and satellite data to track the location of producing plots and assess the risk of deforestation.

1. Audit your systems: Conduct a thorough review of your existing due diligence processes. Ensure that supplier questionnaires, internal checklists, and risk assessments are updated to reflect the requirements of the EUDR.

2. Map your supply chain: Work with procurement and legal teams to trace products through every level of the supply chain. Identify potential risks, focusing on regions and suppliers associated with deforestation.

3. Collect geolocation data: Businesses must gather geolocation coordinates for all plots of land involved in the production of relevant commodities. Leverage digital tools and existing databases, such as Global Forest Watch, to obtain the necessary data.

4. Start now: Although the EUDR doesn’t take effect until December 2024, it applies to products being produced today. Businesses, particularly those with long production cycles, should begin gathering the necessary documentation to prove compliance.

5. Monitor EU guidance: The European Commission continues to provide updates on the EUDR, including a newly launched observatory on deforestation. Keep track of evolving guidance to ensure your business stays ahead of any changes.

Looking ahead

A 2024 report from the Carbon Disclosure Project found that only 30% of companies surveyed had achieved 100% deforestation-free sourcing in their supply chains. With the EUDR fast approaching, the pressure to adopt sustainable practices is mounting. 

Businesses that act now to improve supply chain transparency and traceability will be better positioned to meet these new regulatory demands.

The rapid expansion of environmental legislation worldwide is creating a maze of compliance challenges for organisations with complex supply chains. 

Regulations aimed at reducing carbon emissions, enhancing transparency, and promoting sustainable practices are becoming more stringent. Increasingly, businesses are finding it difficult to keep up. However, the absence of a unified approach to sustainability across supply chains has led to widespread confusion and inefficiencies. This often results in missed opportunities for genuine environmental impact. 

To navigate this evolving regulatory landscape and future-proof their operations, organisations must adopt best practices for compliance. Also, they must do this while fostering greater collaboration among fellow industry players.

The Challenge of Disparate Sustainability Efforts in Complex Supply Chains

For organisations with complex supply chains, the lack of coherence in sustainability initiatives is a significant hurdle. Diverse standards, certifications, and reporting requirements across regions and industries create a fragmented landscape that complicates compliance efforts. When suppliers adopt varying approaches to environmental management, the resulting inconsistency increases the risk of non-compliance. Not only that, but it also erodes the overall effectiveness of sustainability initiatives.

In complex supply chains, the actions—or inactions—of a few suppliers can impact the entire operation. For instance, a supplier’s failure to meet environmental standards can damage the reputation of the entire supply chain. This failure affects all associated brands and organisations throughout the chain. Such a ripple effect can be especially detrimental in industries where transparency and sustainability are becoming key differentiators in the eyes of regulators, investors, and consumers.

Moreover, the lack of a unified approach often leads to operational inefficiencies. Organisations may find themselves juggling multiple audits, overlapping certifications, and disparate reporting formats, all of which can drain resources and increase costs. This fragmentation not only takes away from the broader goal of achieving substantial environmental improvements but also poses significant challenges for organisations striving to maintain their competitive edge while meeting regulatory requirements.

Best Practices for Ensuring Compliance and Future-Proofing Complex Supply Chains

To effectively manage the surge in environmental legislation, organisations with complex supply chains need to unify their sustainability strategies. This involves streamlining compliance processes, leveraging technology for better data management, and fostering stronger collaboration across all tiers of the supply chain. Here are key practices to consider:

Standardise Across the Supply Chain

Organisations should advocate for and adopt industry-wide standards that streamline compliance across their supply chains. By aligning on common metrics and reporting protocols, companies can reduce the complexity of managing multiple, sometimes conflicting, requirements. This not only simplifies compliance but also enhances visibility and accountability throughout the supply chain, making it easier to identify and address environmental risks.

Build Vertical Coalitions

One of the most effective ways to unify sustainability efforts is by forming vertical coalitions—collaborative partnerships that span the entire supply chain, from raw material suppliers to end product manufacturers. By working together, organisations can share data, resources, and best practices, creating a cohesive strategy that addresses the environmental impact at every stage of the supply chain. Vertical coalitions also enable organisations to present a unified front when engaging with regulators, helping to shape realistic and effective environmental policies.

Leverage Advanced Data Management Tools

Complex supply chains require advanced technological solutions to manage their environmental impact effectively. Data analytics platforms and AI-driven tools can provide organisations with the ability to gather accurate, real time data from across their supply chains, enhancing the precision of emissions reporting and compliance tracking. By focusing on primary data sourced directly from suppliers, organisations can gain a more accurate picture of their carbon footprint, enabling more targeted and effective decarbonisation efforts.

Prioritise Continuous Improvement and Adaptation

Environmental regulations are constantly evolving, and organisations must be prepared to adapt. This requires a commitment to continuous learning and improvement. That includes staying up to date with the latest legislative changes. It also means investing in the skills and technologies needed to meet new challenges. By fostering a culture of adaptability and resilience, organisations not only maintain compliance but also position themselves as sustainability leaders.

The Imperative for Unified Environmental Action in Complex Supply Chains

As the pressure to meet sustainability targets intensifies, the repercussions of fragmented efforts within complex supply chains will become increasingly apparent. Organisations that take a unified approach—characterised by standardisation, collaboration, and strategic use of technology—will be better equipped to navigate the changing regulatory environment and guard their operations against future disruptions.

Sustainability is not just about compliance; it is about creating long-term value and resilience in a rapidly changing world. For organisations with complex supply chains, achieving this requires more than individual efforts—it demands collective action. 

By working together and adopting a cohesive approach to sustainability, organisations can drive meaningful change, mitigate risks, and ensure a more sustainable future for all stakeholders involved.

For decades, the pharmaceutical logistics industry has relied on single-use and multi-use packaging. However, as environmental concerns and economic pressures mount, there’s a growing demand for ‘forever-use’ packaging. This new approach promises to cut down on waste, reduce carbon footprints and achieve long-term cost savings.

Imagine a world where pharmaceutical packaging isn’t just discarded after a single use but is designed to last, repairable and resilient enough to withstand the rigors of global transportation for years. This is quickly becoming a reality, driven by the urgent need for more sustainable logistics practices.

Pathways to forever-use packaging

The COVID-19 pandemic completely reshaped global pharmaceutical logistics. The urgent need to distribute vaccines safely, quickly and globally led to massive investments in cold chain and pharmaceutical logistics infrastructure. 

These investments and the extraordinary demand for reliable distribution methods spurred the development and adoption of robust, repairable solutions designed to last for decades. This shift from single-use containers aimed to make sure that vaccines and other temperature-sensitive medicines could be transported safely, efficiently and sustainably, during the pandemic and beyond.

To understand what forever-use containers entail, it’s crucial to look at their design and functionality. These containers are not just durable. They are built for long-term use over many years. Made from high-grade materials, they can withstand extreme conditions, from freezing cold to intense heat, without compromising their contents. Advanced insulation technologies and strong external shells provide reliable protection against adverse physical and environmental conditions.

Forever vs.multi-use containers

Unlike multi-use containers, which can be used only for a limited number of shipments before needing replacement, forever-use containers are designed for continuous, indefinite use. They can be repaired and maintained, which significantly extends their lifespan and minimises environmental impact. This sustainability aspect is vital as it reduces the volume of waste generated and the frequency of new container production.

The key to these durable containers lies in their sophisticated internal systems. Equipped with high-performance cooling units, they maintain precise temperature control, essential for sensitive pharmaceuticals. These units are designed to run efficiently over extended periods with minimal energy consumption. Integrated sensors and IoT connectivity monitor internal conditions real-time. This makes sure that operators and manufacturers can detect and address any deviation immediately.

Digitalisation has a role to play

Digitalisation plays a key role in the transition to forever-use containers. Real-time monitoring and predictive analytics are essential for maintenance, helping to identify and resolve potential issues before they become problems. 

For instance, if data analysis shows that a compressor in a container is working harder than usual, it can indicate an impending failure. Maintenance can be scheduled proactively to replace or repair the compressor before it fails during a critical shipment.

The containers also include modular components that can be easily repaired or replaced, extending their operational life. If a  unit begins to show signs of wear, it can be swapped out without needing to discard the entire container. This modularity improves the sustainability of the containers, reduces long-term operational costs and keeps the products inside protected.

However, there are still scenarios where these solutions might not be the ideal solution. 

Meeting infrastructure challenges

Despite advancements, less developed regions still face significant challenges in building permanent, sustainable logistics infrastructure. In these areas, the lack of reliable roads, limited access to electricity and inadequate storage facilities complicate the deployment of robust packaging solutions. 

For example, a regional distribution centre in sub-Saharan Africa might not have the infrastructure to support the maintenance and repair of advanced, reusable containers. This means that even if medical organisations can deploy these solutions for initial transport, the lack of necessary support systems diminishes their potential benefits.

Equitable access to pharmaceuticals hinges on developing these infrastructures. Without robust logistics networks, the distribution of medicines can be slow and unreliable. Therefore, building permanent, sustainable logistics infrastructure is critical to make sure that all regions can fully benefit from advancements in pharmaceutical packaging technology.

Practical considerations

While reusable containers are ideal for sustainability, single-use solutions may still be necessary in certain scenarios. Humanitarian crises, route disruptions, or manufacturer shortages can create unpredictable logistical challenges. For instance, during an emergency response to a natural disaster, medicial organisations need to be able to deploy medicines rapidly. While reusable solutions are quick to use, medical staff encounter issues when the time comes to return them. The process of transporting empty containers back can be logistically complex and certainly less sustainable.

Similarly, supply chain disruptions caused by geopolitical conflicts or sudden shortages of pharmaceutical supplies can make the return of reusable containers impractical. In such cases, the flexibility of single-use containers can be crucial to make sure that essential medicines reach all patients. Balancing environmental impact with practical needs remains a challenge for the industry.

Diverse pharmaceutical needs

The pharmaceutical industry is rapidly developing a wide range of products, each with specific storage and transportation requirements. This progress is great news for patients, but it presents challenges for logistics. Shipping solutions must now adapt to accommodate smaller shipments and the need for lower temperatures. Cell and gene therapies, vaccines, and other sensitive drugs require precise temperature ranges and meticulous handling protocols to maintain their efficacy. 

Logistics providers must offer various packaging solutions to cater to these diverse needs. This diversity complicates efforts to standardise processes and achieve sustainability goals. Each type of pharmaceutical product might need a different type of solution, insulation material, or cooling technology. Accomodating for these differences would necessarily add layers of complexity to the logistics chain. The challenge is in meeting the need for specialised care while also pushing towards more sustainable practices.

Future outlook

Looking ahead, the future of pharmaceutical logistics is bright with continued innovation and technological integration. Artificial intelligence and machine learning are set to play crucial roles in predictive maintenance and risk assessment, enhancing the reliability and efficiency of forever-use packaging solutions.

Innovation in packaging materials and technologies will further support the transition towards sustainability. Expanding global infrastructure is necessary to support these sustainable logistics solutions, especially in underdeveloped regions.

Regulatory frameworks will likely evolve to encourage the adoption of sustainable packaging solutions, providing guidelines and incentives for industry players to make the switch.

The shift from single-use to forever-use containers in pharma logistics is essential for a sustainable future. This journey is challenging, from building infrastructure in less developed regions to meeting diverse pharmaceutical needs. However, the potential rewards of sustainability are immense.

By embracing long-lasting packaging solutions, the pharmaceutical logistics sector can meet today’s needs and pave the way for a greener, more efficient future where life-saving medicines reach everyone, everywhere. The urgency to transition is clear. With the right investments and innovations, this transformation is not only feasible but necessary for the health of our planet and people.

The boom in e-commerce may have completely revolutionised shopping, making it more convenient than ever. But with retailers dispatching millions of deliveries directly to our doors – is there a hidden cost? 

This surge in online shopping brings with it a hike in delivery vehicles on the roads. So much so that the UK is predicted to take a £7.9 billion hit to the economy from congestion. Not only that, but the country will also suffer a staggering 64,000 premature deaths from polluted air each year. The rise of same-day and next-day delivery options has only exacerbated these issues. The situation is worsening, leading to an inefficient and highly polluting supply chain. Urban last mile delivery emissions are expected to rise by 30% in the top 100 cities globally by 2030.

This trajectory calls for a pretty radical overhaul of how we approach last mile delivery.

Limitations of electric vehicles

Electric vehicles (EVs) have been heralded as the silver bullet. They produce zero tailpipe emissions but do little to alleviate the issues of congestion in the urban last mile. And, because of their size, they still consume a significant amount of energy as they move around cities. The transition to EVs also involves substantial challenges. These include the need for a comprehensive charging infrastructure and the environmental impact of battery production and disposal.

Even if these infrastructure issues are resolved, the shift to electric vehicles will only partially mitigate the environmental impact of last mile logistics. The problems of pollution, congestion- and the associated depleting quality in delivery experience- require a rethinking of the logistics infrastructure altogether. 

Micro-hubs and modern pedal power

Traditional logistics models rely on large central warehouses located far from urban centres. Parcels travel long distances to reach consumers, increasing emissions and traffic congestion. But, by establishing smaller, strategically located hubs closer to delivery points within cities, you can have efficient, consolidated deliveries. These deliveries can be made using smaller, more sustainable vehicles like cargo bikes. These bikes are super low-emission and specifically designed for urban environments. 

By replacing vans or trucks with cargo bikes, Zedify’s research shows that businesses can reduce their emissions by more than 80% compared with electric vehicles and more than 90% on diesel vans. This not only reduces the carbon footprint of deliveries but also alleviates traffic congestion. 

The result? Cities that are how we would wish them to be – safer, cleaner, quieter.

Technological integration

Technological integration and route optimisation are essential for creating a more efficient and sustainable last mile delivery sector. Development in this area is vital to the roll out of low-emission delivery vehicles like cargo bikes.

Advanced algorithms and AI-powered systems are already becoming central in analysing multiple variables. These can include traffic conditions, weather, and delivery time windows, to determine the most efficient routes logistics companies use. This reduces the total distance travelled, the number of trips required and improves the accuracy of delivery windows. As a result, this can massively improve the customer experience too. 

Advances in technology can also provide real-time guidance to drivers and riders. It can highlight the best routes and potential hazards, improving safety and efficiency, especially in busy urban areas.

Machine learning will become more and more important in cargo bike-logistics, enhancing the local knowledge of riders, helping them access difficult addresses and making use of hybrid road and cycle infrastructure to reach delivery points as efficiently as possible. And AI can optimise battery usage and predict charging needs, ensuring bikes are always ready for use which helps in planning routes that maximise battery life and efficiency. 

Embrace reverse logistics

Sustainability in last mile logistics extends beyond forward logistics—the movement of goods to consumers—to include reverse logistics, which involves the return of goods. Given that up to 25% of returns end up in landfill, companies certainly need to invest in more robust reverse logistics infrastructure that minimises the environmental impact of returns and disposals, contributing to a more sustainable supply chain.

Speed is crucial to getting returned products back on shelves in time to be resold.  Innovative collaborations between sustainable last mile delivery companies and locker networks will be key to speeding up the process of getting products returned and reduce their chances of ending up in landfill in future. 

The future

The urgency of the climate crisis demands innovative solutions across all sectors. 

Reimagining last mile logistics is not just a minor adjustment but a transformative step towards healthier, more sustainable cities. By introducing micro hubs, embracing super low-carbon light electric vehicles such as cargo bikes, leveraging the right technology and building the right infrastructure for friction-free reverse logistics, we can significantly reduce the environmental impact of e-commerce deliveries and create greener, more livable cities in the process.

We all know that the planet is facing its most serious challenge yet – countering the devastating effects of climate change.

One issue is ensuring the sustainability of the ingredients in our global food supply chain. Often there is a lack of information on origin, asset location and deforestation risk. And with EU deforestation regulations in place, and other governments shifting closer to legislation, regulators have stricter requirements for evidence that farmers are growing products responsibly, with negligible risk of deforestation and land conversion. 

One example is palm oil, an essential ingredient used a lot in cooking, and also by many manufacturers to make chocolate and ready-made meals. However, experts estimate that palm oil is responsible for more than 5% of all deforestation in tropical forests to date.

The Supply Chain Data Partnership 

Ordnance Survey (OS) is the founding partner of an initiative called the Supply Chain Data Partnership (SCDP), formally established at COP27. 

The partnership has been designed to develop and provide critical location insights for the assurance of global supply chains via a location register. It aims to provide enough confidence to certify the location of an asset, such as a farm, site or facility, so that buyers and investors can see that the asset owner is willing to be transparent and be monitored. 

The SCDP will help tackle greenwashing by working to ensure efficient and trustworthy sustainability reporting, ensure public and private investors avoid high-risk investments and potential risks, while identifying plausible opportunities for green and sustainable investment. 

So how does the SCDP work? 

The SCDP seeks to provide a location dataset for global supply chains. These can inlcude palm oil, soy, cotton, rubber, mills, factories and wood-based packaging applications which the SCDP will add to a register. The register will allow the identification and verification of those assets, with follow-up monitoring over time. 

Data and certificates associated with each verified asset owner will then sit on the new register, designed to meet global registry standards. Buyers and investors will then be able to access the tool, allowing them to make better decisions in their procurement, reducing risk and enabling assessment of impact and opportunity.  Global brands will be able to engage directly with responsible suppliers to help expand their own sustainability and responsibility goals. This will assist with reducing emissions, biodiversity loss and environmental impact of supply chains, reduce unsustainable agricultural practices and land degradation through more effective monitoring and smart procurement contracts.

Last autumn, the SCDP passed its trial phase and reached a major milestone in developing a proof of concept for its location platform. This has shown how location data and technology can help sustainability initiatives succeed. 

Next steps

Next steps for the SCDP include adding new use cases and scaling up from proof of concept to a Minimum Viable Product with anchor customers.

And while the SCDP continues its development, it has also been supporting a wider supply chain initiative with an even more inspirational, ambitious and influential goal. 

Following COP28, Rewired Earth and Bankers for Net Zero announced ‘The Constellation’ . Over 40 entities supported the resolution, including OS. It is working at a higher level and aims to enable Government, financial services and companies to understand how to encourage, support and verify sustainable supply chains across the world. This forward-leaning organisation wants to transform financial markets into the most protective force on the planet, by driving transparency throughout global supply chains and investments by using the SDG framework. 

As our climate changes we need to scale up our actions to decarbonise and protect valuable resources such as nature and water. 

Whilst on that journey to net zero we also need to ensure we can create resilient supply chains, keep businesses functioning and support societal needs. We can only do that if we really know where things are happening on the planet and where things come from. Without that knowledge we can’t apply all that intelligence and action to ensure a sustainable future for nature and humanity. Fortunately, the SCDP and the Constellation are about getting us to that future and that better place, together.

For more information about the SCDP, contact donna.lyndsay@os.uk. Alternately, go to Rewired Earth | Get Involved for more information on the Constellation.

Many growing brands list expanding internationally as a key driver of their growth in the years ahead. But, as any brand who has gone through this transformation can attest, becoming a truly “global” brand is no simple task. 

What are the challenges for businesses when it comes to cross border expansions? How can brands overcome them?

Brands looking to expand internationally face a number of challenges, from navigating unfamiliar markets to language gaps to dealing with complex logistics. 

This is where Cross-Border commerce solutions like Global-E, Shopify Markets Pro, FlavorCloud, and others come into play. They seek to help brands streamline not only their cross-border logistics solutions (both outbound and returns), but also every other area where an international shopper may interact with their brand. 

This includes key functionality like site translation, support for local currencies and payment methods, compliance with local tax and regulatory requirements, market insights and region-specific research, and support for local shipping providers and regional carriers. They can provide a full service that can help businesses navigate the complicated challenges that international expansion can bring.

What impact are returns having on the environment?

It’s no secret that retail returns are a big environmental problem. 23 million returned garments were sent to landfill or incinerated last year in the UK, which generates 750,000 tonnes of CO₂ emissions, according to a report from The British Fashion Council’s Institute of Positive Fashion (IPF) from March 2023. 

All of that returned inventory has to go somewhere, and often, it simply cannot be restocked. Despite online retailers’ best efforts to convey size and colour, it’s still difficult to know if an item fits, so an unfortunate number of online clothes returns end up in the landfill. Not to mention the carbon footprint involved in shipping items back and forth, all over the world. 

Returns of all kinds have a steep impact on the environment, but fashion brands in particular struggle with staying sustainable, in part thanks to consumer practices like bracketing (ordering more than one product with the intention of returning all but their favourite).

Despite this, eco-friendly returns options matter to consumers. 

According to internal data from Loop, the leading post-purchase platform,  consumers do pay very close attention to the sustainability of the brands they shop with. 88% of shoppers agree that eco-friendly return options make them more likely to shop again. 

Sustainable returns policies?

Providing sustainable return options taps into consumer values and builds brand loyalty, and should be a key priority for brands to stay relevant and increase customer acquisition and retention. 73% of shoppers also regularly review a retailer’s return policy to gauge their sustainability levels and more than half of consumers (56%) care about the environmental impact of returns “somewhat” or “a lot”. 

Over a third (35%) of consumers have opted out of returning a product due to the potential environmental impact (I.E. the possibility of the returned product ending up in a landfill). 13% of shoppers will go as far as not purchasing from a retailer at all if they do not offer eco-friendly returns options.

How can retailers respond to sustainability concerns?

Luckily, there are plenty of ways that brands can address the environmental concerns around returns, particularly clothes retailers who are dealing with large scale returns. Retailers that automate their returns through a returns management platform like Loop, allow brands to offer more eco-friendly options like consolidated return shipping and resale options for example.

• Consolidating return shipments helps shipping providers take fewer trips, which reduces pollution (and costs). By partnering with shipping services like ReBound, you can gain access to a global logistics network, securing competitive shipping rates and a return consolidation engine to further cut down reverse logistics costs.  
• Offering the option to keep an item rather than returning it remains popular as brands look to increase their sustainability efforts and cut down on shipping costs. Many brands leverage this option when an item value is worth less than the cost of a shipping label, or if the item is simply not something that can be refurbished or restocked. The ‘Keep Item’ feature allows merchants to forego return shipping costs and provide the shopper with a pleasant return experience. The savings depend on how often the merchant chooses to use Keep Item, but on average it saves our merchants about $10K on shipping per year. 
• Brands can also choose to route items to a different (closer) destination if returned items don’t need to go back to the warehouse. Not only does this help cut down on shipping time (and the related environmental impact), it also helps brands save on shipping costs, too. 

Last mile delivery and reverse logistics are typically the most expensive and environmentally damaging aspects of the ever expanding supply chain, with some even predicting that carbon emissions could rise by a further 32% if the status quo doesn’t change. The rising popularity of returns and the post-pandemic e-commerce boom, as well as heightened consumer demand for faster deliveries, threaten to push that figure ever higher if retailers hope to keep pace without rethinking their supply chains.  

Luckily however, delivery and return strategies also present a prime opportunity for businesses to cut their carbon footprint. A 2023 survey found that 46% of shoppers had opted for sustainable delivery options in the last year, a figure which rose 3% from the year before. In short: consumers are willing to go green and businesses must follow suit.

Whilst some may see fleet electrification as the solution, transforming underlying processes within the rest of the supply chain to make them more efficient can be equally effective, while streamlining operations at the same time.

1.) Optimise inventory along the last mile

Making sure vans are filled close-to-capacity and in a logical sense, as well as scheduling routes efficiently are crucial for logistics teams looking to achieve lowering costs and reduce the environmental impact of last mile deliveries. The same way retailers need to accurately forecast demand to avoid over- and under-stocking, last mile companies should mirror this approach. As it stands, delivery vehicles are on average only at 84% capacity when they hit the road. By designing routes more intentionally, however, logistics operators can ensure they don’t waste space and fuel on carrying air. In practice, this means grouping deliveries that are close together geographically, eliminating unnecessary stops. Loading vans thoughtfully would also minimise delivery times, ensuring drivers don’t have to rummage through packages at every address.

2.) Embrace new – and more efficient – delivery methods

Out-of-home (OOH) delivery methods – such as parcel lockers or pick up and drop off (PUDO) points – are growing in popularity among consumers, and businesses that bring them into their logistics mix can benefit from improved operational efficiency. By reducing the number of individual homes that drivers visit, companies can lower fuel consumption, decrease emissions and deliver more parcels within the same time frame.

In the UK, Royal Mail has recently joined leading locker providers like Amazon and InPost. This makes it even easier for businesses to offer return options to customers. Acting now will give businesses an early-mover advantage that could soon disappear, too, with 80% of last-mile deliveries in Europe expected to be via lockers within a decade.

3.) Don’t let returns derail your supply chain

Getting reverse logistics right is critical from an environmental and operational standpoint. Experts estimate that as much as 10% of returned apparel isn’t resold. This negatively impacts the planet directly. Retailers typically send returned stock to landfill or truck it off to discount outlets or charities. On top of that, returned items pose additional costs for retailers derived from transporting, processing, inspecting, cleaning and repackaging, not to mention resale markdowns.

Many companies are trialling new return policies to counter these issues. Nearly 80% of UK fashion brands now charge for returns while others have turned to offering store credit rather than cash refunds. It could also be worth considering a hybrid offering. For example, companies could charge a nominal fee for returns that don’t use the more sustainable option like a parcel locker or PUDO point. Improving item sorting processes across warehouses is another solution. Companies that effectively gather data from returned parcels will better understand the kinds of items being sent back, and why customers are doing it. This would then allow them to distribute stock accordingly to minimise future inefficiencies.

4.) Don’t shy away from technology

Advanced technologies, particularly artificial intelligence, are pivotal in conducting deep, analytical examinations of vast, complex datasets with unmatched accuracy and efficiency. This analytical power is crucial for uncovering evolving consumer trends that shape strategic distribution decisions.

By embedding smart data capture into the supply chain, supply chain managers can record and track inventory in real-time as soon as it is scanned. This means data-led decision-making is based on the most accurate and up-to-date information possible. The technology can also guide warehouse workers and drivers with augmented reality overlays when placed on their devices, helping the former find specific items with visual indicators and assisting the latter with loading their vans efficiently.

The intersection of sustainability and profitability

New strategies coupled with advanced technologies can help companies streamline last mile deliveries and reverse logistics, reducing both greenhouse gas emissions and costs. Leaders should prioritise these core components to boost efficiency, increase profit margins, and satisfy consumer demand for eco-friendly operations – in 2024 and beyond.

The world is in the process of a seismic economic and organisational shift towards sustainable decarbonisation. Fossil fuels need to be replaced by sustainable alternatives, including solar, wind, and nuclear; the combustion engine is being replaced by the electric motor. It’s a new kind of industrial revolution. As such, the raw materials that are necessary to drive this green transition are different from those that came before. Already, this shift in the location and nature of raw materials procurement is creating challenges and complexities.

Specifically, graphite, cobalt, lithium, and copper (among others) are increasingly essential resources. Graphite and lithium, in particular, are essential to the electric vehicle supply chain. As the EV market grows rapidly, so too does demand for these metals. “Global demand for lithium and graphite, two of the most important materials for EV batteries, is estimated to grow by more than 4000 percent by 2040 in a scenario where the world achieves its climate goals,” notes an IEA report. 

Critical mineral supply chains are vulnerable to change 

However, geopolitical and environmental pressures threaten to destabilise the supply chains that rely on critical minerals like lithium. From the war in Ukraine to the drought in Panama, securing access to critical materials is an increasingly fraught process. 

It doesn’t help that many of these minerals are geographically scattered. Many of them are located in countries outside of traditional manufacturing supply chains. For example, South Africa controls the vast majority of manganese production. Manganese is used to make wind and solar power generation equipment, as well as EV batteries. Speaking of EV batteries, Chile claims the world’s largest lithium reserves, closely followed by Australia, Argentina, and China. Turkey and China have the richest reserves of graphite. And lastly, the Democratic Republic of the Congo possesses the world’s largest cobalt reserves and the seventh-largest copper reserves.  

These countries’ position at the root of critical mineral supply chains could “lead the world in both technology and clean energy into the next century,” argues an ORF report. In much the same way that oil reserves have generated massive wealth for individuals, corporations, and nation states over the last century, access to the necessary minerals for building electric cars, solar farms, and other green tech could see similar shifts in economic fortune. 

The report adds: “There is no doubt that access to critical raw minerals is a top-of-mind agenda for countries around the world. What is less clear, however, is where global cooperation goes from here.”

Reevaluating the West’s relationship to Africa 

Some experts argue for a “strengthening of transatlantic partnerships with Africa.” The Chinese government’s strategy over the past several decades has raced ahead of Europe and North America in this goal. Chinese developers offer “infrastructure projects and no-strings-attached investments that are attractive to leaders who want to build their own economies.” 

Europe and the US could aim to replicate this strategy. However, the ORF caution that “if countries want to truly prioritise the green transition, it means not only increasing policy dialogue with Africa, but also coming to the table with worthwhile partnerships.” 

Both the US and Europe must “fundamentally change” their relationships with Africa. ORF report author Rachel Rizzo argues that, “if the West wants to build better relationships with Africa, it must offer something of value in exchange.” She argues for genuine industrial partnerships that allow African states to “move up the value chain,” from simply extractive roles to refining and manufacturing. 

Apple recently announced plans to dramatically expand its efforts to curb Scope 3 emissions. 

Apple slashes scope 3 emmissions

While Scope 1 and 2 emissions refer to greenhouse gas emissions resulting from a company’s own operations (buildings, vehicles, and other sources of pollution that a company like Apple owns and operates itself), Scope 3 emissions cover the environmental impact of all the companies within a company’s supply chain—up or downstream. It’s thought that Scope 3 emissions could account for more than 70% of most businesses’ environmental impact. 

According to Apple, its plans to reduce scope 3 emissions will see more than 320 of its suppliers commit to using 100% renewable energy for Apple production by 2030. This is an increase from around 250 suppliers last year, and represents 95% of the company’s direct manufacturing spend. 

Apple’s efforts to clean up its supply chain have already had a marked impact. Between 2022 and 2023, the company’s total carbon dioxide emissions dropped from 20.6 million metric tons to 16.1 million metric tons, a 22% reduction. Most of that progress, Apple’s latest sustainability report reveals, is due to its suppliers’ sustainability efforts. 

The company urged its suppliers to decarbonise the Scope 1 and Scope 2 aspects of their supply chains related to Apple in 2022. Suppliers were reportedly notified that progress towards these goals would be a  key criteria considered when awarding business. Considering Apple earned $383 billion in 2023, it should come as no surprise that it can set pretty much whatever standards it wants for its suppliers. 

It’s why the world’s largest manufacturers have so much impact on global sustainability efforts; they have the power to dictate environmental practices for entire upstream industries throughout their supply chains. It’s similar to the way California, as the US’ largest auto market, has dictated environmental standards for vehicles even though many other states don’t have such stringent regulations.  

Water, wind, and solar—going beyond power purchasing agreements

Apple is doing more than demand that its suppliers decarbonise, however. Apple is continuing to invest in solar power infrastructure in the U.S. and Europe, reportedly to help offset the electricity used by customers charging their Apple devices. 

The company is also making progress toward another environmental goal. By 2023, Apple has pledged to replenish 100% of the fresh water used in corporate operations in “high-stress locations.” 

The plan involves working with various partners to deliver nearly 7 billion gallons in water benefits over the next two decades. These benefits will range from restoring aquifers and rivers, to funding access to drinking water. 

“As with clean energy, Apple has extended its commitment to clean water across the entire supply chain: Together, Apple suppliers saved over 12 billion gallons of fresh water last year, for a total of 76 billion gallons in water savings since the company launched its Supplier Clean Water Program in 2013,” Apple wrote in a statement to the press.

“Clean energy and water are foundational to healthy communities and essential building blocks for a responsible business,” said Lisa Jackson, Vice President of Environment, Policy, and Social Initiatives at Apple. “We’re racing toward our ambitious Apple 2030 climate goal while taking on the long-term work to transform electrical grids and restore watersheds to build a cleaner future for all.” 

For companies with the economic power to create change in their supplier ecosystems, Apple’s sustainability efforts could serve as an effective blueprint for decarbonising their supply chains in a meaningful, beneficial way. 

As urban populations increase, along with the need for decarbonised supply chains, the electrification of last mile logistics is emerging as an essential step towards a sustainable economic future. 

Around the world, the momentum of last mile electrification is growing. However, questions still remain connected to overcoming barriers to adoption and implementing a fully electrified last mile supply chain. Finding answers is becoming more and more urgent as the climate crisis worsens while global urban populations swell. 

E-commerce in the age of the megacity

Cities will account for well over 50% of global consumption by the end of 2025. Urban populations are growing faster than rural ones. Migration into urban spaces is predicted to result 6.419 billion people living in cities by 2050. 

Research by Frost & Sullivan projects that, by next year, the world will be home to 35 megacities—defined as urban areas with a population of 10 million people or more.

The largest megacity in the world is sometimes identified the Pearl River Delta in the Guangdong-Hong Kong-Macau Greater Bay Area region. Guangzhou, representing the Pearl River Delta, is estimated to have around 65,100,000 inhabitants. That’s roughly equal to the population of the UK. 

Urban populations are growing. This trend is overlapping with the growth in e-commerce to place profound strain on the logistics networks serving urban centres. This is especially pronounced in megacities, where population size and density compounds the issue. 

These megacities are witnessing a dramatic growth in the frequency of parcel movement owing to ongoing e-commerce growth. Analysis by Civitas, a network of European cities, calculated that there are between 300 and 400 goods transports per 1,000 people per day in some of Western Europe’s larger cities. 

Megacities see at least 3 million deliveries being made daily. 

E-commerce supply chains in an increasingly urbanised world  

The global e-commerce logistics sector is predicted to experience more than 20% growth over the next decade. 

“In this e-commerce boom, the volume of packages is only going up,” says Josh Garnham, co-founder at Packfleet, an all-electric last mile delivery company that operates in London. Packfleet, along with other supply chain operators (large and small) are faced with an increasingly complicated proposition. 

E-commerce and urban growth are driving up demand for logistics services covering last mile delivery. However, at the same time, the need to reduce the environmental impact of supply chains is becoming increasingly urgent.  

As noted in a report by last mile delivery platform company Stuart in 2022, companies in the logistic sector are “part of a value chain that must remain profitable while urgently decreasing its negative impact on the environment and the people supporting it.”

Garnham adds: “A sustainability revolution in e-commerce is needed in 2024.” He adds that petrol and diesel delivery fleets “negatively impact us and the environment” noting their contribution to congestion, “as well as noise and air pollution.”   

Electric vehicles are key to decarbonising the last mile 

Tackling decarbonisation at a time when logistics volumes are only going up is a challenging prospect. Garnham admits that “the pressure is on to make more sustainable changes,” adding that “if parcel volume isn’t going to decrease, then we need to make sure that the environmental impact of delivery does.”  

Electric vehicle adoption is a compelling fit for last mile delivery for a few reasons. Firstly, electric vehicle ranges and efficiency capabilities are particularly suited to driving for shorter distances with frequent stops and starts. Secondly, as noted by Deloitte researchers, “as urbanisation and e-commerce surge, last mile delivery has become a critical and dynamic sector, where the implications, advantages, and challenges of EV adoption are particularly pronounced.”

What will an electrified last mile supply chain look like? 

There are three primary characteristics that a successfully electrified last mile logistics sector will display. First, the transformation will be technologically enabled. Secondly, upfront capital barriers to entry will see traditional ownership models evolve. And, lastly, widespread transformation in the industry will require significant infrastructural and regulatory support from governments. 

Technology enabled

Primarily, the decarbonisation of the logistics sector will need to be underpinned by technology—specifically data and AI. Packfleet, for example, maximises the capabilities of its EV fleet by using technology to deploy that fleet more intelligently.  

“Building our tech stack from the ground up, we’re able to be agile, reactive and drive the industry towards a more efficient and sustainable delivery alternative,” Garnham explains. “Routing is incredibly hard – roadworks, traffic, changes to the delivery time or location, they all impact it – but technology is allowing us to navigate all of these things in a few seconds.” 

Stuart takes a similar approach with its platform. The company orchestrates its network of EVs, couriers, and other logistics vehicles in a way that reduces emissions and increases efficiency through smart routing, stacking deliveries, and reducing missed deliveries by means of on-demand features and omnichannel communication. 

Similarly, Garnham adds that Packfleet uses “AI-enhanced technology to empower a fleet of zero-emission vehicles to provide hassle-free deliveries. Customers can pick delivery windows and redirect parcels in real-time.” As a result online purchases become “close to frictionless,” whilst also reducing emissions. 

New ownership models 

Investment in logistics fleets is a cap-ex heavy proposition. Reinvestment into the electrification of entire fleets may be beyond the scope of many organisations. This is especially true of those that aren’t operating as dedicated logistics companies. 

As a result, traditional ownership models could evolve to encompass leasing or subscription services. Such an arrangement would increase flexibility in the short and medium term especially. Additionally, this shift would enable companies to take advantage of emerging EV technology and services without crippling upfront costs. 

Supported by the public sector

Lastly, the public sector also has a role to play in creating the necessary regulatory, financial, and infrastructural conditions for an EV revolution. 

John Gillan, UK general manager at Stuart, argues that governments “must step up for small businesses struggling with inflation, supply chain issues, and rising running costs to ease the burden and encourage more sustainable delivery practices.” He advocates for governments offering tax breaks or subsidies for EV adoption (like many have in the consumer space). 

Whatever shape the process takes, it’s clear that the electrification of last mile logistics is complicated, challenging, and absolutely necessary. “Logistics is often the forgotten link in the e-commerce chain when it comes to sustainability, but it needs to be tackled if we’re to reach net zero goals,” Garnham reflects.