At the heart of the drive towards circular supply chains are moves to reduce waste and increase recycling.
Progress on this front is important, whether on a modest scale – such as with solutions adopted by small- to medium-sized businesses – or a macro scale, as with multinationals.
One multinational that is leading the way on this front is Colgate-Palmolive (CP). With 34,000 staff and total net sales of more than US$17.4bn in 2021, CP is one of the most valuable brands in the world. Its products are sold in 200 countries and territories, and include some of the most recognisable household brands: Speed Stick, Palmolive, Ajax, and Hill’s Pet Nutrition. Unsurprisingly, its supply chain is colossal.
Though CP’s journey to net zero is a mammoth undertaking, it is making eye-catching progress nevertheless, central to which is its commitment to TRUE Zero Waste – a zero-waste certification programme designed to measure, improve and recognise zero-waste performance. CP is also part of the vanguard of companies forging a more sustainable future.
“We have more TRUE Zero Waste-certified facilities than any other company on the planet,” says Colgate-Palmolive’s Chief Supply Chain Officer, Mike Corbo. “A total of 18 sites, altogether, in 10 countries spread across five continents – including the first ever TRUE Zero-Waste-certified facilities in Africa, Latin America, continental Europe, India, China and Vietnam.”
Colgate Palmolive’s zero-waste commitment
Yet, this is just the start for CP; its ambition is to ensure all its facilities are Zero Waste by 2025.
“We’re aiming for Zero-Waste certification for our global operations, including our manufacturing sites, technology centres, strategic offices and owned warehouses,” says Corbo.
The company has made significant strides in this area, but how CP has managed to make such great progress on waste reduction could hardly be less glamorous.
“You’d be surprised at how we achieved this,” says Corbo. “It sounds kind of silly, but we started pretty much by doing dumpster dives – literally rifling through what we were putting in the waste stream.”
He adds: ”We began to separate it all and started asking questions. Why is this or that not in the product? Why isn't this being recycled? What exactly is our waste stream?
“This is where you have to start. It takes years, and it takes focus. But money and resources we were throwing out in materials doesn't get thrown out anymore. It gets reused, repurposed, or put back into the product. We’re continually looking to reduce waste, and have been for a long time.”
Sustainable supply chains ‘take time, effort, focus’
The key to waste reduction, he says, is measuring everything: “We measure how much electricity and water we use, and how much waste we generate, then we come up with innovative ways to reduce usage.”
He adds: “I'm very proud of the fact that we've taken on a zero-waste-to-landfills initiative in our manufacturing operation. We have it certified externally and will soon have all 45 plants certified.”
The company is also working towards making all of its new manufacturing sites LEED certified. LEED stands for Leadership in Energy and Environmental Design and is a worldwide green building certification programme.
“We want to ensure these sites are optimised for energy efficiency, water savings and waste minimisation from day one,” says Corbo,
While CP is a poster child for waste reduction on the multinational front, progress among small companies is equally important, as is the vast tech ecosystem that is helping SMBs hit their net zero targets.
One such company is OnProcess Technology, which helps organisations harvest meaning from vast fields of data with a view to optimising their after-sales service supply chains.
Move to net zero changing linear supply chains
This is the part of the supply chain that’s helping to close the circle on sustainability, whereby businesses provide services around a product – such as parts and materials, repair and maintenance – once it is sold.
Supply chains have always been linear and, until recently, have had a ‘take, make, use and throw away’ mindset.
OnProcess is helping customers reimagine this model through its digital platform, Agora, an integrated stack of tools that offers insight and untangles problems.
“When I started in this industry 20 years ago, bits of kit were manufactured in factories, went through a forward supply chain, were sold through some sort of retail network, and then ended up in the bin or landfill after they had been used,” explains OnProcess CEO Oliver Lemanski.
The circular supply chain acts as an antidote to this. Manufacturers and distributors recover products and parts from the field when no longer needed and repurpose them back into the value chain, either as raw materials for new products or as refurbished or remade new products.
And, because the service portion of supply is the point at which products and parts are identified as unnecessary, companies such as OnProcess are vital if the circular supply model is to gain traction sooner, rather than later.
Firms slow to join digital transformation party
But Lemanski says many service supply chain firms have been slow to join the digital-transformation party.
“A typical service supply chain is a web of disconnected, manual processes managed by siloed departments,” he says. “It’s in desperate need of digitisation and automation.”
He adds: “We give such businesses the ability to reimagine and automate processes on the fly – dramatically reducing costs, transforming the customer experience and helping our clients hit their sustainability targets.
“Sustainability is in our mission. We help companies reduce carbon emissions by facilitating the use of local tracking, recycling or disposal offerings. We also help reduce the use of Earth’s resources by improving product and part returns, while driving greater circularity into their service supply chains.”
Often, waste can run into tens of millions of pounds, dollars or euros and can be difficult to manage effectively. One example of waste running up costs is that of an OnProcess customer who is a leading provider of TV entertainment services via set-top boxes. With subscribers to such services often moving to other providers or deciding they can no longer afford the fees, many boxes become obsolete, which was the case with this company. So how has OnProcess helped fix this?
“The company’s focus was on helping its customers use the boxes, rather than on returning them, so its box-retrieval record was patchy,” says Lemanski. “But now, every disconnecting customer is sent a recovery kit that includes a fitted shipping box and prepaid UPS label.
“As a result, box returns are running at 95% for voluntary disconnects and 55% for non-voluntary, producing $60mn in cost savings. This is what agility and transparency in the service supply chain looks like on the ground.”