Sustainability is more than a buzzword; as a global distributor, it has to be. According to data from the Canadian Government, more than 60% of all greenhouse gas emissions come from Heavy Industry, Transportation, and the Oil & Gas Industries—industries we directly serve. In Canada’s heavy industry, emissions declined 11% between 2005 and 2019 and are projected to decline by 39% by 2030. Other industries are also tracking significant progress toward minimizing emissions.

There remains considerable work to do, however. For manufacturers and businesses in these sectors, the MRO (maintenance, repair, and operations) and indirect materials supply chain can provide an opportunity to think sustainability while enhancing their business operations. 

Are you prepared to implement strategic decisions into your indirect supply chain while incorporating sustainability goals?

An Analysis of Sustainability within the Indirect Supply Chain

Before companies can reduce their footprints, they need to understand them. Within the MRO and indirect supply chain, this means taking stock of the entire process including waste generation, energy consumption, and the use of technology to track and optimize the procurement of supplies. 

Some of the key areas to analyze include:

• Inventory levels and excess

• Procurement processes.

• Sustainable offerings among suppliers

• Energy reduction opportunities

Key Strategies for Sustainable Optimization

Data-Driven Demand Planning & Inventory Management

One of the most critical problems in indirect supply chains is inaccurate demand projections, often resulting in inventory overstocks or shortages. This is not only financially costly, but can lead to waste an and emissions from additional deliveries. Leveraging data can not only streamline an operation but contribute to a more sustainable enterprise.

AI-Driven Forecasting: Using predictive analytics to determine demand patterns and optimize inventory levels to reduce deliveries of MRO supplies and indirect materials.

Vendor-managed inventory (VMI): Manage inventory levels based on real-time information to prevent stockpiling and waste.

Digitization & Automation: Track material usage with IoT sensors and implement cloud-based platforms for efficient reordering.

Supplier Collaboration & Sustainable Sourcing

Every partner in the supply chain has a role to play in making sustainable choices. Partnering with distributors who can source sustainable goods and who have partnerships with suppliers with shared sustainability goals is important when tackling this issue holistically. Sometimes the most sustainable option doesn’t fit the needs of your business. True partners can examine sustainable options from top suppliers and source the best option for your business and sustainability needs.

Energy-Efficient & Low-Waste Procurement

When companies purchase sustainable materials and equipment, they significantly reduce industrial energy consumption and waste.

  • Energy-Efficient Equipment: When possible, select tools and equipment that require less power and have a prolonged service life.
  • Reduced Single-Use Items: Implement reusable, remanufactured, or refurbished components to lengthen material life cycles.
  • Lifecycle Assessments: Assess the complete environmental impact of products before making procurement decisions

Real-World Benefits & The Business Case for Sustainability

Companies that implement sustainable supply chain optimizations receive numerous benefits beyond environmental achievements. Decreasing material waste and energy use results in cost savings and lower operational expenses. The implementation of sustainable practices creates positive brand perceptions and drives partnerships with customers and others who value sustainability. Additionally, tackling these issues helps meet government sustainability standards.

Ready to transition to a more sustainable future?

Sustainable supply chain optimization does not have to be a complex process. Here’s how businesses can begin:

  1. Conduct an Audit. Examine opportunities to improve sustainability and find efficiency in your company’s indirect supply chain.
  2. Set Measurable Goals – Establish specific sustainability KPIs like decreasing material waste or electricity usage by set percentages.
  3. Find Sustainable Partners—Do business with providers who share your commitment to environmental responsibility and ethical procurement.
  4. Implement Smart Technology – Apply AI, IoT, and automation to enhance procurement processes and inventory and energy management.

Achieving sustainable optimization of MRO and indirect materials is a necessary step for the environment and a logical advancement for business operations. Through waste reduction, improved sourcing, and data-driven decision-making, industrial businesses can improve their operational performance while decreasing costs and environmental impact.

The time to act has arrived. Vallen can help.