This guide to sustainable 3PL fulfillment will look at the role that eco-friendly practices can play in increasing your operational efficiency and cutting costs, and what steps third-party logistics (3PLs) partners can take to make it happen. Read on to see how cloud-based warehouse management systems (WMS) like Logiwa IO can help 3PLs optimize their energy use, embrace sustainable technologies, and minimize waste to meet consumer expectations while driving their own profitability.
Key takeaways
- Growing regulatory pressures, increasing customer demands, and the ROI of eco-friendly solutions all combine to make sustainability a necessity.
- To craft a sustainable 3PL fulfillment strategy, companies should optimize their energy use, implement eco-friendly technology, and find ways to reduce waste throughout the fulfillment process.
- Cloud-based WMS tools like Logiwa IO facilitate sustainable 3PL fulfillment by improving efficiency through automation, enabling data-driven decision-making to reduce waste and find areas for improvement, and delivering greater flexibility by offering a scalable warehousing solution.
Why 3PLs need eco-friendly fulfillment
Far more than saving a few trees, sustainability has become an essential consideration for any company looking to build its brand. Some factors that contribute to the need for sustainable 3PL fulfillment are:
- Growing customer demand: Modern consumers and B2B clients increasingly prefer to partner with environmentally responsible companies. With so many customers giving their business to brands that align with their values, companies that fail to meet sustainability expectations risk losing valuable sales.
- Regulatory pressures: Environmental regulations incentivize green technology implementation, and they also create stiff penalties for conducting non-sustainable practices. When companies develop a 3PL sustainability strategy, they can reap the benefits of complying with industry standards and avoid the penalties that come with violations.
- Cost savings and ROI: They may require an investment upfront, but sustainable practices can lead to significant cost reductions in the long run. Whether it’s lowering your energy bills through efficient lighting and HVAC or reducing labor, waste, and fuel costs with automation and optimized routes, sustainable warehouse management provides cost savings at every level of your operations.
From cutting your warehouse management costs to complying with regulatory standards and aligning with your consumers’ priorities, the question isn’t if eco-friendly fulfillment for 3PLs matters — it’s how much are you losing without it?
Request a free demo to learn more about Logiwa WMS.
Growing your sustainable 3PL strategy
Companies have many tactics available for building a sustainable 3PL fulfillment strategy, but they need the right technology in place to execute them. Here’s how 3PLs can reduce carbon footprints for themselves and their clients — while boosting profitability.
Optimizing energy use in the warehouse
Power consumption can account for roughly 15% of the average warehouse’s total expenses, so making the most of your electricity use is critical for cutting costs. Some ways you can improve your energy efficiency in warehouses are:
- Installing energy-efficient lighting, such as LED lights. Motion-activated sensors can also turn off lights in unused areas, reducing unnecessary power consumption.
- Implementing smart heating, ventilation, and air conditioning (HVAC) systems and sufficient insulation, to reduce heating and cooling requirements.
- Integrating renewable energy sources such as solar panels, wind turbines, or geothermal systems, or partnering with power companies that provide renewable options.
Green initiatives are often about surveying your entire operational pipeline and identifying which inefficiencies would be easiest to resolve. Cutting your power consumption offers savings while reducing emissions, so start there to elevate your sustainability efforts.
Adopting eco-friendly technologies
Eco-friendly technologies address the most prevalent areas of fulfillment waste, offering solutions like:
- Green transportation, such as electric vehicles (EVs) to eliminate fuel-related emissions.
- Route optimization software, to reduce mileage and subsequent transportation costs.
- Sustainable packaging, such as recyclable, biodegradable, or right-sized packaging to minimize waste.
Automation and robotics also play an important role in sustainable 3PL fulfillment. These tools help reduce energy consumption and improve efficiency — if they’re powered by the right WMS tool to launch them.
Reducing waste throughout the fulfillment process
From excess packing material to 20–35% of all shipping trucks being empty at any given point in time, the fulfillment industry can have far too much waste. Reducing this waste often involves simply changing business processes rather than adding extra technology. Some sustainable fulfillment practices include:
- Integrating the 3Rs (reduce, reuse, recycle) into every layer of your warehouse operations, to develop a comprehensive waste management strategy.
- Practicing inventory management, to prevent overstocking and reduce waste from expired or obsolete products.
- Launching paperless operations such as digitized paperwork and WMS-powered record-keeping, to eliminate paper-based waste.
While these waste management practices go beyond technology, they still depend on the right tools to deploy them. WMS solutions enable 3PLs to execute their sustainable fulfillment strategies, so they’re still a critical part of your waste reduction processes.
How a cloud-based WMS like Logiwa IO drives sustainability
Cloud-based WMS solutions are the central nervous system of a sustainable warehouse — without them, your green 3PL fulfillment strategy will fail to get off the ground. They empower your eco-friendly efforts by improving your warehouse efficiency with automation, letting you make smarter business decisions, and offering a scalable platform that lets you use only the resources you need.
Improving efficiency through automation
WMS tools offer pick path optimization, reducing travel time for employees and equipment and curbing your power consumption. They also enable automated workflows, reducing the errors that inevitably come with performing repetitive tasks. The result is not only less rework and fewer returns, but a reverse logistics infrastructure that lays the foundation for a circular economy — the future of green logistics and 3PL.
Real-time visibility and data-driven decisions
Cloud-based WMS software enables greater inventory accuracy by letting you track the motion of your products in real-time. This reduces the risk of overstocks, preventing you from wasting valuable materials. They also offer advanced data analytics functionalities to give you actionable insights on how you can improve your power consumption.
Scalability and flexibility
Another benefit of a cloud WMS for sustainable fulfillment is that it allows 3PLs to scale their operations up or down as needed, without over-provisioning resources. This allows you to use more fulfillment resources during seasons of peak demand, and to reduce them if business slows down. Such flexibility eliminates the need for adding extra equipment, storage space, or inventory to your operations just to prepare for heightened demand, making it a sustainable practice in itself.
By enabling companies to use only the resources they need, scalability is one of the key benefits of sustainable logistics — and of ecommerce fulfillment as a whole.
How Logiwa IO empowers echo-friendly fulfillment
Sustainability doesn’t only provide 3PLs with the cost savings and operational increases needed to drive greater profitability. It also aligns with modern consumers’ priorities, attracting eco-conscious customers to your brand. Implementing sustainable technologies such as electric vehicles or biodegradable packaging can reduce your carbon footprint, and AI can combine with automation to reduce fuel costs, optimize fleet usage, and avoid waste in your warehouse.
Logiwa IO is an industry-leading WMS solution, and our AI-powered platform gives you the capabilities you need to implement the eco-friendly practices that today’s consumers demand. Optimize warehouse processes while speeding up delivery times and scale your operations without overprovisioning resources to minimize wasted time and space. These are just a few ways that WMS solutions can help your business save green by going green, so request a demo of Logiwa IO today.
FAQs about sustainable 3PL fulfillment
Enhancing Your Green Logistics: Frequently Asked Questions About Sustainable 3PL Fulfillment
What are the primary drivers for 3PLs to adopt sustainable fulfillment practices?
Additionally, increasing regulatory pressures from governmental bodies incentivize the adoption of green technologies and penalize non-sustainable practices. Beyond these external pressures, there is a strong business case for sustainability. Eco-friendly practices can lead to substantial cost savings and a positive return on investment (ROI) by reducing energy consumption, optimizing transportation routes, and minimizing waste.
How can a Warehouse Management System (WMS) support a sustainable 3PL strategy?
- Improved Efficiency and Automation: A WMS optimizes warehouse workflows, such as picking paths, which reduces travel time for both employees and equipment, thereby cutting down on energy consumption. Automation also minimizes errors, leading to less rework and fewer returns.
- Data-Driven Decision Making: By providing real-time visibility into inventory, a WMS helps prevent overstocking and the associated waste of obsolete products. Advanced analytics also offer insights into energy consumption, helping to identify areas for improvement.
- Enhanced Scalability and Flexibility: Cloud-based WMS solutions allow 3PLs to scale their operations according to demand without over-provisioning resources like equipment and storage space, which is an inherently sustainable practice.
What are some effective strategies for reducing a 3PL's carbon footprint?
- Optimizing Energy Use: Warehouses can lower their substantial energy consumption, which can account for up to 15% of their expenses, by installing energy-efficient LED lighting, using smart HVAC systems, and integrating renewable energy sources like solar panels.
- Adopting Eco-Friendly Technologies: Implementing green transportation options like electric vehicles (EVs) and utilizing route optimization software can drastically cut fuel consumption and emissions. The use of sustainable packaging, such as recyclable or biodegradable materials, also plays a crucial role.
- Reducing Waste: A comprehensive waste management strategy, including the “3Rs” (reduce, reuse, recycle), is essential. Effective inventory management prevents overstocking, and transitioning to paperless operations eliminates paper waste.
