Saving through sustainability

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Embedding environmental evaluation in day-to-day packaging decisions is a critical step to improving the stewardship and conservation of valuable resources for the future.” –Anne Johnson, director of the Sustainable Packaging Coalition

All this focus on “sustainability” may seem way too “touchy feely” for truckers, but I’ve been finding out there’s a none-too-secret reason more and more shippers and transportation providers are ready to jump on the “sustainability” band wagon: cost savings.

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Take United Parcel Service's new “green” measurement system for shipment packaging, for example. Dubbed the Eco Responsible Packaging Program (and what a ridiculous name THAT is), UPS said this effort is designed to evaluate a customer’s packaging processes in three areas: damage prevention, right-sizing and packaging materials.

UPS said it will then “score” the results and those customers who meet the requirements can display the program’s logo on their shipment packaging.

Strip away the layers of “sustainability” rhetoric, though, and you can start to see why the costs savings potential for stuff like this is getting people’s attention.

Bob Stoffel, UPS’s senior vp-engineering, strategy, supply chain and sustainability, said that so-called “responsible packaging” begins with protecting the contents being transported, for damaged goods not only frustrate the recipient but often lead to the need to remanufacture and reship – doubling the shipment’s carbon footprint but also burning more pricey fuel.

So – wallah! – by packing it right the first time, the transporter and the shipper can at the very least reduce costs associated with freight damage and fuel costs.

Stoffel also says shrinking the size of the box means using less material and, by extension, fewer assets to transport said package. Again, right there: costs savings on two fronts.

I exchanged emails with Steve Yucknut, vice president of sustainability for Kraft Foods, not too long ago about much bigger and longer-term sustainability efforts on Kraft’s part. Since 2005, the company sliced more than 50 million freight truck miles out its global transportation and distribution network.

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Now, truckers might look at that and say, “Hey, they’re cutting back on the very service I provide,” but that’s just the surface view.

Yucknut (at left) told me it’s all about re-configuring transportation so it’s more “sustainable” from both an environmental and economic perspective. In many cases, that meant shifting to more truck-rail moves than truck –only, and for some very good reasons; namely, avoiding highway congestion. Letting a big rig sit in traffic, going nowhere for hours while burning gallons of diesel, does no favors for anyone’s pocketbook, much less for Mother Nature.

"We think about miles, piles and idles when moving our product," Yucknut told me. "We're finding ways to drive fewer miles, reduce inventory piles and eliminate idling trucks. We're collaborating with customers and suppliers alike and we're using a number of high-tech innovations for our trucks and warehouses to reduce energy and CO2 [carbon dioxide] emissions."

For example, in North America, Kraft Foods saved more than a million miles of truck transport by replacing 10,000 truck shipments by shipping wheat via waterways to its Toledo, Ohio, flour mill; with ships making bigger yet less frequent deliveries.

Here are some of the other “sustainable” changes Kraft made worldwide to its transportation and logistics system:

• In Brazil, it saved nearly 250,000 miles by using boats to send products to distribution centers. In just six months, the change saved more than 125 truck shipments.

• In Germany, Kraft Foods transports coffee beans from Bremen to its Berlin roasting plant, saving about 1.8 million miles and taking 7,000 trucks off the road.

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• In Austria, Kraft Foods saved more than 150,000 miles by sending products in refrigerated containers on railcars, eliminating 400 truck shipments.

• In the United Kingdom, the company now sends products to one of its key customers by train instead of truck, saving more than 40,000 miles and eliminating 120 truck shipments.

• In Europe overall, Kraft Foods is modernizing its transportation network by establishing a single hub in Bratislava, Slovakia to make 20% fewer trips between its European plants and distribution centers.

• In the Philippines, the company now uses a national distribution center so customers receive shipments 20% faster than before, saving miles and fuel.

Yet Yucknut he emphasized that all of Kraft’s our sustainability projects need to make business sense in the long run; otherwise, they wouldn’t be truly “sustainable.”

“Sure, we’re using trucking alternatives where possible, but as mentioned before, we’re doing it where it makes business sense,” he told me. “Often times rail and truck combinations can reduce our fuel consumption and CO2 emissions and provide greater capacity. Of course, there’s only so much track out there, and rail isn’t always an option. That’s why we’re making our existing truck equipment more efficient. And our private fleet of trucks ‘earns its keep’ by providing better service at a lower cost the competition.”

And if you think trucks aren’t part of Kraft’s “sustainable” transportation vision for the future, think again. Check these efforts out:

• In North America, Kraft purchased 11 hybrid direct store delivery vehicles for frozen products. The hybrid power train and electric refrigeration technology use up to 30% less fuel than a traditional truck.

• In Mexico, the company pioneered a ”double-decker” transport system that allows trucks to safely carry up to 56 pallets in one load – twice as many as before.

• Back in the U.S., using Oracle’s Transportation Management program to create Project MOST (Management of Optimized Sustainable Transportation), Kraft measured truck movements and designs new trip segments to minimize "empty miles," eliminating more than 500,000 miles in 2008 alone.

“Hybrid trucks are evolving, and it’s just one of the high tech solutions we’re using to reduce emissions,” Yucknut told me. “The diesel-electric hybrid truck has a refrigeration system that operates with electricity generated by the truck’s engine instead of a separate diesel-powered unit—so it’s lighter and has fewer moving parts. So there are quite a few advantages to consider.”

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He added that another important part of Kraft’s “sustainability” success is with relationships built with customers, other carriers, and even government entities like the Environmental Protection Agency.

“We’ve been working with the EPA’s SmartWay partnership for several years, and they’ve helped us adopt new technology like auxiliary power units (APUs) to reduce idling, as well as lots of other technologies,” Yucknut said. “They also helped us with our ‘no idling’ policy at distribution centers and many plants and the decision to reduce our governed top speed on all over-the-road tractors from 65 to 62 miles per hour."

In the end, he said, the future is really about driving culture change to not only become more “green” in the classic environmental sense but to save money, too.

“We’re finding that when we look at our business through a sustainability lens, we create the ability to drive lasting change,” Yucknut explained. “People come up with great ideas that will help us grow our business and reduce costs, while protecting the environment and society.”

Frankly, you can’t beat that kind of combination.

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Trucks at Work: Sean Kilcarr comments on trends affecting the many different strata of the trucking industry.

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