Innovative Approaches to Building a Sustainable Supply Chain

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Table of contents

1. Why is supply chain sustainability important?
2. Consumer demand for sustainable products is at an all-time high
3. Retailers and resellers are tightening sustainability requirements
4. Governments are ramping up sustainability regulations
5. Sustainable sourcing 101: Building a greener supply chain
6. Step one: research and identify sustainable materials
7. Step two: Assess and monitor new and existing suppliers
8. Step three: Evaluate labor ethics
9. Step four: Rely on established certifications and standards
10. Automating supply chain sustainability with Surefront
11. How the custom questionnaire works
12. Evaluating vendors and products with a custom questionnaire

Supply chain sustainability is about managing the environmental, social, and economic impacts within supply networks. It involves adopting practices that reduce negative environmental effects, promote fair labor practices, and contribute positively to the communities involved in the production and distribution processes. 

Optimally, sustainable supply chain management will create long-term value by balancing economic performance with environmental and social stewardship.

Why is supply chain sustainability important?

There are an increasing number of reasons why sustainability is crucial for modern supply chains. 

Consumer demand for sustainable products is at an all-time high

Firstly, the demand for sustainable products by consumers is rising. A recent study by McKinsey and NielsenIQ¹ discovered that products that make sustainability claims outperform the competition: 

• Products with sustainability claims averaged 28% cumulative growth over five years, compared to 20% for products without such claims
• Products making sustainability claims accounted for 56% of all growth in the categories studied, 18% more than expected given their initial market share

The study also found that brands with sustainability claims grow faster than the competition:

• In 59% of categories, smaller brands with sustainability claims experienced disproportionate growth
• In 50% of categories, larger brands with sustainability claims also saw higher growth rates

In addition to better sales and overall growth, sustainable brands have more loyal customers. Brands with more than half of their sales from sustainable products saw 32-34% repeat purchase rates, compared to under 30% for brands with less than 50% of sales from sustainable products.

Retailers and resellers are tightening sustainability requirements

Businesses like Walmart have adopted thorough methods for assessing and guaranteeing the sustainability of vendors. This means that vendors and suppliers who want products on Walmart shelves must have sustainable supply chain practices. 

Walmart has exceptionally high standards relative to other companies, but the trend of retailers adopting sustainability requirements continues to grow.

Governments are ramping up sustainability regulations

New sustainability standards are being implemented across the world. 

In the US, the SEC recently implemented its Climate-Related Disclosures. In the UK, the Corporate Sustainability Reporting Directive is being phased in. And President Xi Jinping has stated that China is committed to achieving carbon neutrality by 2060.

New sustainability regulations will continue to be adopted as nations become aware and concerned about environmental and ethical labor issues. These regulations affect all businesses that work with international suppliers.

That’s why we regularly update our retail sustainability guide with the latest regulatory information.

Sustainable sourcing 101: Building a greener supply chain

Sustainable sourcing prioritizes finding materials that are environmentally friendly and ethically produced. These actions must span across all vendors and manufacturers for a truly green supply chain. 

We’ll take you through a few key steps to sustainable sourcing to help simplify the process.

Step one: research and identify sustainable materials

The journey toward sustainable sourcing begins with a thorough understanding of materials that are environmentally conscious. These materials will vary by industry, but some examples include renewable resources like:

• Bamboo
• Hemp
• Organic cotton

Recycled materials also play a crucial role in sustainable sourcing efforts. By utilizing recycled plastics, metals, or paper, businesses can help divert waste from landfills and conserve natural resources. Additionally, prioritizing biodegradable materials that can decompose naturally without harming the environment further contributes to sustainability goals.

Step two: Assess and monitor new and existing suppliers

Collaborating with suppliers who share a commitment to sustainability is paramount in building a truly green supply chain.

Evaluating suppliers based on their environmental policies, practices, and transparency regarding material sourcing is essential. Regular audits and site visits can provide valuable insights into supplier sustainability efforts, ensuring alignment with your company's goals.

Surefront’s Vendor Management System (VMS) makes this particular process simpler. You can manage vendor compliance on a shared platform:

• Communicate with vendors about compliance issues
• Perform compliance audits
• Automate vendor certifications
• Build a detailed vendor scorecard

We’ll get into these functionalities in more detail later. All you need to know now is that Surefront makes monitoring and assessing your vendors turnkey. 

Step three: Evaluate labor ethics

Evaluate and monitor suppliers to ensure workers are paid fairly, working reasonable hours, in a safe environment, and are not being discriminated against. 

Surefront’s VMS is also useful in this process because you can build a custom questionnaire with customizable fields and attachments for images. This allows you to evaluate vendors to your specifications and satisfaction. It makes it easier to build and maintain an ethical supply chain.

Step four: Rely on established certifications and standards

Navigating the complex landscape of sustainable materials is made easier by relying on certifications and standards established by reputable organizations. A few well-known certifications include:

• Forest Stewardship Council (FSC) for wood
• Global Organic Textile Standard (GOTS) for textiles 
• Cradle to Cradle certification for a range of products 

These certification bodies provide assurance that materials have been sourced and produced in a sustainable manner.

Eco-labels, such as USDA Organic, Fair Trade, or Blue Angel, are visible markers of sustainability and ethical sourcing practices. These labels help businesses make informed decisions and instill confidence in consumers who prioritize sustainability when making purchasing choices.

Automating supply chain sustainability with Surefront

We’ve developed new technologies to automate supply chain management. Chief among these technologies is our custom questionnaire.

The custom questionnaire allows businesses to evaluate various aspects of their supply chain, including labor conditions, safety standards, fire standards, and contamination standards—giving businesses deeper insights into vendor operations and ensuring compliance with sustainability and ethical sourcing requirements.

How the custom questionnaire works

Unlike generic form-building tools like Google Forms, Surefront's custom questionnaire feature is specifically designed for supply chain management purposes. It offers advanced functionalities:

• Flexible user-defined fields (UDFs): Create custom questions tailored to your vendor and category needs, providing a detailed and relevant assessment.
• Support for attachments and images: Attach documents like business licenses, insurance certifications, factory photos, and third-party testing reports.
• Searchable database: Completed questionnaires create a searchable database for vendor compliance teams.
• Automatic audit trail: Maintain an audit trail for all information completed in the questionnaire, ensuring transparency and accountability.

The questionnaires reside on Surefront’s shared platform, allowing you to distribute them to numerous vendors effortlessly—tailoring fields to vendor categories or specific vendor needs. Standardizing everything on a shared platform means questionnaires can be viewed, queried, and combined to form larger, more complex assessments  

You can also monitor in real-time as suppliers work on questionnaires, commenting on improperly filled-out items and requesting additional verification via attachments when needed.

Evaluating vendors and products with a custom questionnaire

Surefront's custom questionnaire allows businesses to assess vendors and products on sustainability and compliance.

For Vendors, you can include questions about labor and factory conditions. You can also require pictures and certifications for additional verification. 

On the product side, Surefront comes pre-built with comprehensive product information management tools and fields. You can leverage our flexible fields to include product questions about material sourcing and production practices. 

These features give you unparalleled transparency into your supply chain.

Key takeaways

Sustainability is a topic that must be taken seriously by modern supply chain businesses. Here’s some of the key things we’ve learned about sustainability in this article:

• Sustainable supply chain management is essential for managing environmental, social, and economic impacts, aiming to reduce negative effects and promote fair practices
• Rising consumer demand for sustainable products is driving market growth and brand loyalty
• Retailers like Walmart are increasingly demanding sustainable practices from vendors
• Governments worldwide are implementing stricter sustainability regulations.
• Sustainable sourcing involves identifying environmentally friendly materials, evaluating suppliers, and relying on established certifications and standards
• Surefront's custom questionnaire feature streamlines supply chain sustainability by allowing businesses to assess and monitor vendors and products

For the next steps on leveling up your supply chain processes, take a dive into our complete guide to retail sustainability.