In recent years, many corporations and government organizations have begun to implement sustainable procurement programs. These programs foster better corporate social responsibility within both businesses and government bodies alike. They generally involve various recommendations and regulations in regard to the responsible sourcing of sustainable materials.
In fact, a lot of companies also put together their own programs.
No matter the specific program, they all carry the same fundamental goal. That is to improve sustainability and reduce the environmental impact of sourcing raw materials and the manufacturing of goods.
Although each supply chain partner has a unique role to play with improving sustainability efforts, one of the most difficult areas to change is manufacturing. Depending on the product, the customers, and the methods for manufacturing them, the struggle for green sourcing is indeed real.
In this blog post, we will dive into a few of the factors that impact sustainable procurement programs specifically for manufacturing companies. We'll take a look at the goals and objectives that government agencies have in creating these programs and introduce a few solutions to help ease the integration process.
What is the US DOD Sustainable Procurement Program
More than 10 years ago, the United States Department of Defense created a sustainable product purchasing program. This program enhances mission readiness through the acquisition of resources and consumables via sustainable efforts.
The program ranges from the products purchased from manufacturers and suppliers to the transportation organizations retained to move those products and deliver them to US DOD facilities.
The goal of this program is to set forth a standard procurement procedures guideline while enhancing the sustainability factor. Everything from reducing our carbon footprint to more humane labor laws has made it into these guidelines.
Originally, this program was utilized for the military. Essentially, it ensured that supplies for troops were sourced in a way that did not affect the efficient operation of other government programs and agencies. Since many United States manufacturers depend on DOD contracts, these concepts bled over into other industries and has grown and transformed massively over the years.
The United States is not the only country to enact sustainability procurement programs. The EU including Germany, the United Kingdom, and France have similar programs with many of them dating back to the early 2000s. While many of their sustainability efforts are driven on reducing carbon emissions for transportation, it still impacts manufacturers and other suppliers.
The Impact of Volume Procurement on Manufacturers
There are several manufacturers who depend on government contracts for their livelihood. It's no secret that most United States Department of defense agencies purchase commodities in large volume orders. By doing so, this often reduces the cost of supplies.
The US DOD sustainable procurement program features two phases.
First, it improves the quality and sustainability of items purchased for government use. This causes manufacturers to retain raw materials that are eco-friendly or included on the list of approved sustainable supplies. With the restriction on the materials approved for manufacturing also comes new procedures and methods for manufacturing these commodities.
There are several large manufacturers that have different procedures and policies for making similar equipment or products sold to civilians. Some manufacturers have even made complete changes in their operations proactively plan for the same type of integration within the private sector.
The second phase is focused on using carriers that have accepted sustainability methods or equipment for operating a greener supply chain. In most cases, this responsibility falls on the agency enacting the procurement policy and not the manufacturer. However, all manufacturers must verify the requirements on an individual basis. This is to ensure that they comply with any transportation regulations for the importing of their supplies by approved carriers.
Identifying the Steps to Efficient Sustainable Procurement
There are a few steps that manufacturers can take in order to comply with sustainable procurement programs. Let's take a look at a few of the most common...
Identify the Stakeholder Requirements
Each sustainable program is different. The first step that any manufacturer can take is to clarify the requirements of each sustainable procurement program on an individual basis.
Create a Plan to Retain the Right Supplies and Tools
If a manufacturer must get in compliance, they must create a plan to efficiently do so. This begins with the cost analysis of the amount of money needed to make these changes. Sometimes it is not worth the investment for a manufacturer to change if the numbers don't add up.
Manage, Review, and Adjust
Like any other plan, the most successful sustainability procurement programs are reviewed and adjusted for efficiency.
Several manufacturers reach out to 3PL's like Redwood Logistics to help with this. An experienced 3PL brings with them a complete understanding of federal sustainability procurement policies and processes.
if you have questions about improving for complying with sustainability procurement programs with federal, state, or local government agencies, contact Redwood Logistics today.