Sustainability is rapidly moving from an aspirational add-on to a key consumer demand. According to recent research by Bain & Co, sustainability is now a major purchase criterion for 50% of consumers, with American customers willing to pay an average of 11% more for sustainable items.
This makes it imperative for ecommerce businesses, like all other companies, to place sustainability as a business priority. There are numerous ways that organizations can improve their sustainability profile, but one that often goes overlooked, and is proving the slowest to cut its carbon emissions, is shipping.
The oversight is ironic, since shipping is among the sectors most impacted by climate change. Shifting weather patterns already caused significant backlogs to shipping through the Panama Canal and the Mississippi river, to name just two important trade waterways. An RTI study predicts that climate change will cost the shipping industry as much as $10 billion a year by 2050 in damage to ports alone, and as much as $25 billion annually by 2100.
This adds to the impetus for doing everything you can to improve sustainability in your shipping processes. Here are three important areas where you’re probably missing opportunities to boost sustainability, and the actions you can take to improve.
- Optimize packaging
Packaging is one of the most obvious places to start in your quest for greener shipping, given that videos of tiny items cushioned by plastic peanuts in comically large boxes have been circulating online for years. Yet an astonishing number of companies still haven’t addressed it.
Far too many businesses are still overusing single-use plastics and generating excessive packaging waste, to the extent that packaging is responsible for 45% of all ecommerce emissions, according to the Retail Carbon Footprints Report from technicians at MIT.
An easy way to reduce your carbon footprint is to replace traditional, non-biodegradable packing materials like plastic and styrofoam with more environmentally-friendly alternatives. There’s a plethora of options today, ranging from recycled paper and cardboard to plant-based plastics and compostable materials.
Another important step is to optimize packaging to be a better fit for your deliveries. Paccurate’s parcel packing intelligence platform uses advanced technology to combine your item dimensions, packaging options, carrier rates, and the labor involved, and produce the most appropriate packing suggestions.
Smart packaging with tools like Paccurate reduces the size and weight of your packages to save on unnecessary materials, as well as helping you fit more items into the same shipping space to cut emissions and overall shipping costs. According to Paccurate’s own research, users save an average of 1 square foot of cardboard per carton and use 14% fewer trailers, lowering SCOPE-3 emissions by at least 14%.
- Digitize admin
International shipping is highly dependent on paper-based processes. It’s not unusual for a single shipment to use as many as 50 sheets of paper, sent back and forth between up to 30 different stakeholders. Even in 2020, which was a very slow trade year due to the COVID-19 pandemic, ocean carriers issued approximately 16 million Bills of Lading, of which fewer than 0.3% were electronic.
It’s hard to believe that in an era where everything else can be paperless, digitized ocean freight is still so uncommon. Moving these administrative tasks onto digital platforms would thus remove an enormous amount of paper waste from circulation, increasing sustainability significantly.
Digital freight forwarder Ship4wd offers a comprehensive online platform that enables users to manage all of their shipping online. You can totally leave behind the stacks of paper concerned with customs clearance, cargo insurance, duty calculations, brokerage services, and more, helping you to save emissions, time, and money.
Managing admin processes with Ship4wd also brings other advantages, including more streamlined operations, fewer manual errors due to less data being entered by hand, and time saved on shipping management. McKinsey estimates that electronic Bills of Lading could save as much as $6.5 million in direct costs. Relieving the stress of complying with complex import and export regulations may even be priceless.
- Reduce returns
The Retail Carbon Footprints Report notes that product returns account for around 25% of emissions for ecommerce businesses, due to the wasted fuel on delivery and return transportation, wasted packaging, and the amount of returned items that end up in landfill. Taking steps to reduce returns can have a significant impact on your overall carbon footprint.
Your first step should be to optimize your website with high quality images, detailed descriptions, a range of reviews, and size guides where relevant, so that consumers can make more informed decisions. It might also be a good idea to make it easier for consumers to cancel orders instead of waiting for them to come and returning them after arrival.
Counter-intuitive though it may seem, longer returns windows have also been found to cut returns rates, because people tend to value items more once they own them (this is known as the ‘endowment effect’). If a customer knows they have six months to send something back and it sits around in their home during that time, they are likely to get more attached to it and less likely to end up returning it, even if that was their initial intention.
Another basic but impactful tactic is to implement address verification technology like Loqate, to ensure that all your packages end up in the right place. Loqate’s software engine can match, format, and enrich partial or complete address records, turning them into valid and verified delivery addresses. The platform is effective in 250 countries and territories, and in Canada, Australia, and the US, the Verify feature can carry out data processing to produce address formats that are CASS, AMAS, and SERP-certified. Users report that their delivery issues have fallen by as much as 50%.
Sustainable shipping is a strategic business advantage
Prioritizing the sustainability of your ecommerce shipping is both a vital business step for your company, and a goal that is well within your reach. Following these tips will help you improve the sustainability of your shipping processes.
However, these are just three of the top ways to cut your emissions; understanding what contributes to your company’s personal carbon footprint will give you even more clarity on how to reduce it. To make your impact even greener, you can initiate carbon offset programs for any inevitable emissions that you can’t remove.