Green supply chain management: logistics and transportation services–A Canadian perspective

Highlights

While competing in a highly commoditized service sector, Canadian logistics and transportation serviceproviders are placing increasing importance on green supply chain management (GSCM). Even though the value of GSCM activities is rarely disputed, literature to–date has been sparse in providing tangible evidence regarding performance and business benefits. For this reason, Supply Chain and Logistics Association Canada (SCL) partnered with Industry Canada to review the important service business function of GSCM. This resulting report provides unique insights to helpCanadian logistics and transportation services executives understand the current trends and to recognize thebenefits of adopting GSCM practices.

Companies that have adopted GSCM practices in distribution activities have successfully improved their business and environmental performance on many levels.

Key findings:

• Most Best–in–Class (BiC)^{Footnote I} businesses are able to increase distribution efficiency and servicedifferentiation while reducing distribution cost.
• The high cost of energy is the main driver for implementing GSCM practices in distribution activities.
• A large portion of BiC businesses increased their use of multi–modal transportation (e.g., decreasing air and truck transportation and increasing rail and marine transportation) to maximize environmental and business benefits.
• Most logistics and transportation service providers implementing GSCM practices see improvements in energy reduction, waste reduction, and reduced packaging in distribution activities.
• To be successful at GSCM, BiC logistics and transportation service providers are using manyhighly advanced processes and technologies — both at the corporate level and within theirdistribution centres (DCs) and transportation operations.

Approach and methodology

This report is based on a collaborative undertaking between SCL's research committee and Industry Canada's Service Industries and Consumer Products Branch. The SCL research committee defined industry needs, drivers, and metrics and offered valuable insights from an industry perspective. By using SCL's 2008 Green Supply Chain Survey (1 165 business entities which included 240 Canadian logistics & transportation organizations)¹, and applying unique economic models developed in–house, Industry Canada provided the overall analysis and brought together all the components needed to produce a Green Supply Chain Management report for Canada's logistics & transportation services sector.

This report is one of a series of three GSCM reports that include:

• GSCM: Manufacturing — A Canadian Perspective;
• GSCM: Logistics & Transportation Services — A Canadian Perspective; and
• GSCM: Retail Chains & Consumer Product Goods — A Canadian Perspective.