There has never been as much awareness and urgency, locally and globally, to drive sustainability. Climate change is now recognised as an existential crisis that is starting to affect everyone and it will only get worse unless people, business and governments truly work together to make positive change.
The question is, how can Australian SMEs jump on this opportunity and maximise sustainability at every stage along the supply chain line with limited resources, budget and manpower?
The key is having the right supply chain management technology to deliver true integration that is sustainable and accountable. The time is now for businesses to jump on this opportunity to effectively become independent end-to-end market providers and compete with the big end of town, through aligned horizontal integration.
The green hoops SMEs must jump through
SMEs are leading the pack in terms of recognising the value that sustainable business practices have for long-term survival. Research from Auspost found that 44 per cent of SMEs believed sustainability is very important to the future success of their business. Yet, recognising the importance of sustainability to a business is just scratching the surface. Embedding it into daily operations can be a significant challenge for SMEs as 17 per cent are unsure of where to start in their sustainability journey.
On top of this, the scarring from the pandemic is holding most SMEs back from increasing sustainability-related ambitions and investments. Pressures from the rising costs of goods, property and severe labour shortages have also stretched revenue and operations thin, and further compounded by the ongoing supply shortages.
Today’s consumers are more informed than ever before, with many reconsidering the products they buy and who they buy them from. Research found consumers are more likely to purchase from brands that are sustainable and many are willing to pay more for products and services that protect the environment. With this in mind, it’s clear that SMEs who don’t incorporate sustainability as part of their core value proposition will feel the impacts in terms of both reputation and revenue in the future. Proactive SMEs who successfully navigate the various external pressures and lean into the sustainability demands of their consumers will get ahead of the game and capture significant market share.
The time is now
In the end-to-end supply chain, there are many opportunities to remove structural waste and improve productivity and service, while at the same time reducing carbon footprint. However, implementing technologies does not mean businesses necessarily receive the green tick of approval. Transforming a business into a sustainable one must begin with setting green KPIs to ensure a business is prepared with measured and defined plans in place. SMEs can then use technology where it best fits and know that their expenditure towards sutainability is not being wasted.
The key to unlocking value is employing technologies that reduce ESG risk and integrate sustainability within the day-to-day transportation and logistics that drive their core business. Given that many SMEs utilise a third party such as Australia Post to transport their goods, ESG capabilities that can embody the mindset of ‘borrow-use-return’ can help a reduction in greenhouse gas emissions flow onto the transportation legs.
Planning, measuring and reporting carbon emissions related to supply chains is just the first step. ESG capabilities also lays the baseline to assess your footprint and an ongoing measure to track against net-zero commitments or regulatory compliance. Integrating these standards across all operations will give SMEs the leg up to act now, helping to make more effective business decisions over their financial, service and environmental barriers. Looking to the future, this is about more organisations utilising the innovation available to them, to create greener supply chains and helping to move the sustainable needle forward.
