How Supply Chain Collaboration Drives Sustainability and Competitive Advantage

Christian de Boisredon, founder of Sparknews, writer, and social entrepreneur, shares how supply chain collaboration can transform both sustainability and profitability. From shared trucks to river barges, companies that pool resources and embrace transparency can drastically cut emissions, reduce costs, and gain a competitive edge.

Resource pooling, such as sharing warehouses and trucks, is one of the most effective ways to decarbonise and reduce costs. Optimizing filling of trucks can save 30% costs (and carbon) with low investments while an electric truck costs 5 times more to buy than a regular one. There remains significant untapped potential in these practices. However, convincing clients to view these initiatives as a marketing asset is essential, much like promoting messages such as “we use electric vehicles.”

For example, for a retailer like Carrefour, optimising truck utilisation would have a much greater immediate environmental impact than switching to electric or biogas-powered trucks. Unfortunately, this type of optimisation is underutilised because it is seen as less marketable. Developing clear marketing arguments that emphasise the substantial benefits of pooling and optimising transportation is crucial. This requires collaboration between logistics providers and their clients to communicate the true value of these actions effectively.

Building trust requires transparency about the environmental impacts of supply chain operations. For example, FMCG companies and retailers need to provide accurate information about the carbon footprint of their products and services. This transparency helps align stakeholders with common objectives and promotes accountability.

A significant challenge is the limited profit margins of logistics providers, which restrict their ability to invest in large-scale decarbonisation. To address this, collaborative systems supported by regulations and economic incentives are necessary to ensure that responsibilities and costs are shared equitably across stakeholders.

A compelling example is FM Logistic’s project with the Madrid metro. Instead of using trucks to deliver goods to the city center, metro trains, which are stored on the outskirts overnight, are loaded with goods before their first morning service. The trains then transport these deliveries to the city center, where they are distributed using last-mile solutions. This approach drastically reduces truck trips, traffic congestion, and CO2 emissions while optimising logistics costs.

Another example is the use of barges on the river Seine for deliveries in Paris by retailers like Franprix and Monoprix. Trucks deliver goods to the outskirts, and barges transport them to central Paris, where they are distributed locally. This solution combines significant economic and environmental benefits.

It could play a role in optimising routes, particularly by reducing empty runs in transportation. For example, a shared platform could connect carriers with empty roads to businesses needing goods transported on the same paths. This concept, similar to carpooling for transport, could significantly reduce emissions. The key challenge is consolidating efforts into a single platform, as fragmented systems dilute effectiveness. A unified, well-funded platform could maximise impact. Why not asking the european law makers to make it compulsory for all carriers to connect to this single platform? It would be a win for all : carriers, customers, environment.

AI also holds promise for optimising supply chain logistics. It can help determine the best locations for warehouses, select the most efficient transportation modes, and streamline delivery routes. Why not create the best tool for all carriers in a coopetition mode (cooperation with it’s competitors). 

Regulations are crucial for aligning companies on sustainable practices. For instance, a carbon tax based on delivery speed or transportation modes could incentivise businesses to choose less emission-intensive options. A one-hour delivery has ten times the impact of a 24-hour delivery, and a 24-hour delivery still significantly outpaces a one-week delivery in terms of emissions. Taxing services based on their environmental impact would finance the logistics sector’s ecological transition while curbing unnecessary habits.