Sustainability in logistics: your questions answered

Why is sustainability in logistics so important? What’s the difference between carbon insetting and offsetting? And is there really such a thing as low-emissions delivery?

At DHL, these are just some of the questions our experts get from customers as they seek to find a more sustainable path for their operations. From multinational businesses with large, complex supply chains, to smaller enterprises looking at where to begin on their sustainability journey, DHL is well versed in guiding them towards low-emissions logistics solutions.

Here, DHL Express’ sustainability experts – Michiel Greeven, EVP Global Commercial; Noelle Froehlich, Senior Expert, Clean Operations; and Bettina Paschke, VP ESG Accounting, Reporting & Controlling – discuss sustainable logistics strategies that can help businesses reach their goals quicker.

Important elements of sustainable logistics

The European Environment Agency predicts that logistics will account for up to 40% of global carbon dioxide emissions by 2050 unless effective measures are taken¹. Businesses of all sizes are beginning to consider their own contribution to this statistic, and what changes they can make to reduce their carbon footprint.

Implementing low-emissions strategies can help your business reduce waste and inefficiencies – leading to cost savings. Furthermore, a survey by McKinsey² found that 66% of consumers consider sustainability when they make a purchase, meaning your business’s environmental policies could help attract more customers.

What are the differences between offsetting and insetting?

Any business researching sustainable logistics practices will probably come across the terms “carbon offsetting” and “carbon insetting” – similar sounding but not to be confused.

Carbon offsetting involves calculating the emissions your business produces and then investing in external programs to compensate the footprint – such as a nature conservation project.

Carbon insetting involves focusing on improvements directly within your supply chain; making changes at the source, as it were. For example, this might mean switching from fossil fuels to renewable fuels, or improving energy efficiency within manufacturing processes.

Arguably, insetting is more impactful as it’s the only way companies can truly reduce their emissions. As the World Economic Forum states, “The battle with soaring temperatures will not be won until organizations start decarbonizing their own value chains to include more nature-positive solutions and operations.”³ Any business serious about reducing their carbon emissions should be evaluating their supply chain operations to identify where the majority are embedded, and then set targets to reduce their output.

How can I make my logistics sustainable?

With customers’ expectations for ultra-fast deliveries, it’s perhaps unsurprising that carbon emissions from e-commerce logistics are expected to reach 25 million metric tons of CO₂ by 2030⁴.

Yet, by prioritizing sustainable delivery solutions, businesses can help to push back:

• Switch to sustainable fuels. DHL’s GoGreen Plus is a dedicated solution to help businesses reduce the carbon emissions associated with their shipments through the use of Sustainable Aviation Fuel – a sustainable fuel that is produced from renewable materials including vegetable oils and animal fats. SAF can reduce greenhouse gas emissions by around 80% compared to fossil fuels.  
  
• Reduce your failed delivery rate with DHL Express' On-Demand Delivery (ODD). Every re-delivery attempt costs your business money and increases its transportation emissions. But with ODD, your customers will be able to choose from a wide range of flexible delivery options – including choosing a specific delivery time (when they know they will be home), or opting to have the package left with a neighbor or at a parcel locker. This means that whilst your customers enjoy a convenient experience, your business will increase its first-time delivery rate which will reduce its emissions. 
• Optimize last-mile deliveries with AI. If you’re making several deliveries to customers a day, with your own fleet of vehicles route planning software can help you plan the most efficient sequence, taking in factors such as distance, real-time traffic, vehicle capacity, and delivery time windows. All of which means goods get to customers quicker, and your business reduces its fuel consumption. In case you do not operate your own fleet of delivery vehicles, choose a logistics partner which makes use of this technology.
  

 What are the “Four As” of sustainable logistics?

The four As of sustainable logistics are availability, affordability, acceptability and adaptability, and can guide your business as you plan and allocate resources to new sustainable practices:

What are the first steps to becoming more sustainable?

For SMEs with limited resources, implementing a low-emissions logistics strategy doesn’t have to be complex. There are several low-cost, immediate changes your business can make to become more sustainable:

• Reduce your energy consumption. Turn off lights, computers and machinery when not in use. A utilities management system can help you track and reduce your usage.
  
• Look for suppliers that have dedicated sustainability certifications – such as Fairtrade International.
  
• Install recycling stations around your office and within your warehouse.
  
• Educate your staff. Make “reduce, reuse, recycle” your workplace mantra.
  
• Switch to sustainable packaging. Prioritize recyclable, reusable and biodegradable materials.
  
• Invite feedback from customers about changes they’d like to see from your brand.
  
• Choose a sustainable logistics partner. DHL Express has a range of dedicated delivery solutions to help SMEs reduce their carbon emissions. Our experts will assess your business’s unique needs and suggest the right solution – without compromising on speed or service.