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Go green or go under: expert warns
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By Zo
ë
Fielding
MANUFACTURERS will soon be left behind if they do not reduce the environmental impact of their products, processes and businesses, according to US-based Scot Case, director of procurement strategies at the Center for a New American Dream.
“As more and more large institutional customers start demanding safer products, products that do not contain cancer causing chemicals, products that are energy and water efficient, then the companies that are best equipped to provide those will be the winners.
“Companies that have not started at this point are likely to be the losers, so the financial incentive on the manufacturers’ side is to make sure they are adequately positioned to take advantage of those markets when they occur,” Case told Manufacturers
’
Monthly on his recent visit to Australia.
Speaking at the Buying Green conference in Sydney late last year, Case said institutional customers were increasingly aiming to buy less polluting products from less polluting companies.
“Purchasers are beginning to focus on three key areas when they are trying to compare a product...They are asking ‘What are the environmental impacts of the product itself?’...Then they look at the impact of the manufacturing process...and they are also looking at the impact of the company.”
The “greening trend” is growing stronger each year, Case says. “It is conceivable that it will grow strong enough that some of the larger companies will push for legislation that requires it, so the smart companies are going to begin the adaptation process sooner rather than later,” he added.
As well as possible legislative demands and competition from locally produced environmentally friendly products, Case claims manufacturers will also face competition from “green” products made in China before long.
“Companies now that are worried about competing with China based on price are soon going to have to worry about competing on price and environmental requirements,” he said.
Case claims the Chinese government is taking environmental issues very seriously. “As one example, China is beginning to import and build internally a lot of cars and automobiles. They are requiring those automobiles to be much more compact, much more fuel efficient than is required anywhere else in the world...Any manufacturer that believes China is not producing environmentally friendly products will be in for a big shock in the near future.”
Manufacturers also have the opportunity to benefit from producing environmentally friendly products in ways which are less damaging to the environment, Case argued. He said that by considering the environmental impacts of manufactured products, managers could identify opportunities to save money or make money they may not have seen otherwise.
“When they are buying raw materials, when they are buying equipment, when they are deciding how they are going to transport their goods and services, those are all opportunities for them to improve their environmental performance,” he said.
Case suggested manufacturers could work with suppliers to have raw materials delivered on reusable shipping pallets to reduce waste and save on pallet disposal costs, and could improve energy efficiency to reduce energy consumption, energy costs, and environmental impacts.
However, he warned making changes would take time. “Good companies recognise that the greening trend is expanding and they are preparing now to take full advantage of it later because those that don’t begin taking advantage of it now will perish in a few years when that becomes the issue that people are looking for,” Case said.
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