As the debate around the benefits and drawbacks of on-shoring continues to bristle in the supply chain and logistics world, there seems to be one on-shoring advantage that has missed its moment in the limelight: increased sustainability.
Frequently unseen and underneath each advantage that comes with on-shoring, there rests an enormous boon to your company’s ecological sustainability. Reducing your company’s negative impact on the environment could hardly be considered a drawback; these areas are just a few ways that joining the on-shoring movement could improve your sustainability.
More Reliable Compliance
Developing nations have long dealt with compliance issues. Components from Asia and Eastern Europe have been found to contain harmful, illegal substances more than once. And despite the governments’ best attempts, these issues continue to crop up.
Within the U.S., however, watchdog agencies, government regulators, and a growingly socially conscious population all keep a strict eye on what is being manufactured. While some would say these numerous interested parties are a detriment to U.S. industry, they are also the largest reasons that manufacturing in the U.S. has become known as a world leader in reliable compliance to standards and agreements.
With regard to sustainability, this gives your company the chance to rest easy that suppliers are complying with their stated level of sustainability. If you stake your brand on the fact that your products are more green, having an investigative journalist expose your foreign suppliers as ecologically careless could mean enormous consumer backlash. While manufacturing your products in the U.S., the odds that there could ever be anything for a journalist to discover is greatly diminished.
Greater Regulatory Discrimination
Even when ecologically friendly standards are imposed within developing nations, they are usually blanket regulations with little discrimination between those who excel and those who barely pass.
The United States Environmental Protection Agency and state protection agencies have tiered regulations and standards in almost every sector and industry. Clean air, endangered species, wetlands, and resource preservation, just to name a few, are all handled as separate issues within the U.S. Alongside this, agriculture, fossil fuels, textiles, chemicals, plastics, and wood are all handled as separate issues.
Admittedly, this diversity of regulation can bring with it an initial complexity to on-shoring, however, any supplier you might contract should already have a thorough understanding of the regulations that apply to your industry.
Within this system, your company has the greatest ability to maximize flexibility, while reducing cost and mitigating risk by choosing exactly the right tier of environmental contentiousness to strive for.
Improved Resource Efficiency
Operating within an extensively regulated environment intensifies competition. Especially within manufacturing, the intense price pressure from foreign operations further contributes to building competition within the industry. This amplified competition, in turn, drives out resource waste and inefficient processes.
As far back as 2003, the U.S. EPA has released reports denoting the improved resource efficiency found in U.S. manufacturing. While manufacturers might not explicitly focus on being environmentally conscious, resource waste is a cost that U.S. companies experience more forcefully than their foreign counterparts. Rising energy costs make an easily understood example.
Diminished Transportation Requirements
With every movement of a component within a supply chain, there is an associated cost of transportation. Hidden within that cost is the price of the fuel required to move the freight.
In the most straightforward example of on-shoring improving ecological sustainability, being forced to ship components an enormously reduced distance radically decreases the fuel required to keep a supply chain operating.
Further, the U.S. has some of the most well-developed transportation infrastructure in the world. Rail available for freight movements is incredibly extensive across the continent and the most modern aviation technology is employed when time-to-delivery is key. These facts certainly come with advantages external to sustainability, but they also radically impact the cost of a supply chain on the environment.
On-shoring can have incredible advantages to your supply chain. Increasing ecological responsibility might not be your company’s first priority, but on-shoring will ensure that your company is not left behind at the very least.
Video – The Importance of Supply Chain Risk Mitigation
We are curating a conversation about supply chain risk at costflexrisk.com. We put this video together to highlight the impact of supply chain risk in the news. Please take a look and then let us know what you think at @GSCSOptimize:
Source Article from http://www.business2community.com/sustainability/greener-pastures-on-shoring-impacts-on-sustainability-0548472
