Sustainable manufacturing as a strategic approach for factories and warehouses

The pressure mounts for manufacturers to step up and use the principles of sustainable manufacturing

In 2020, two-thirds of U.S. adults (64%) said protecting the environment is a top priority. With this in mind, manufacturing organizations need to realize the environmental impact of their operations, to create sustainable manufacturing processes.

The good news is that new technologies and methods have come about making it possible for the manufacturing industry to reduce its environmental footprint through energy conservation, alternative packaging, and smarter storage and organization (amongst other solutions).

With this in mind, this Green Business Bureau article has been created to act as your quick guide to address some of the main sustainability issues the manufacturing industry faces. The issues addressed are associated with a company’s warehouse and factories, both of which have a big impact on a manufacturer’s environmental footprint. Our aim is to help you create a sustainable warehouse and green factory.

We’ll also talk about how you can properly plan and organize green initiatives for maximum success.

What is sustainable manufacturing?

“Sustainable manufacturing is the creation of manufactured products through economically-sound processes that minimize negative environmental impacts while conserving energy and natural resources. Sustainable manufacturing also enhances employee, community, and product safety“.The Environmental Protection Agency, Sustainable Manufacturing

The challenge of creating sustainable manufacturing processes

Many large manufacturing organizations rely on warehouses and factories for storage and production processes. These facilities often run around the clock – always open and always operating. This means a significant amount of energy is used at all times to keep the lights on, run the HVAC systems, and power all of the devices and machinery inside.

Most of this energy is produced by the burning of fossil fuels which releases a mass amount of carbon dioxide into the environment. Carbon dioxide is a greenhouse gas that traps heat in our atmosphere, disrupting Earth’s natural climatic cycles.

Once more, factories and warehouses create a significant amount of waste, from the packaging materials they use to the mass amounts of paper required to create labels and paperwork, to the storage of their boxes and products.

Thinking about these environmental issues, this Green Business Bureau article looks to address them with our 6 tips on how to create a sustainable warehouse and green factory.

6 tips to create a sustainable warehouse and green factory

It’s time to find green solutions for your manufacturing business, to make the shift and create a more sustainable business model.

Tip #1: Implement energy efficiency and conservation measures

Manufacturing processes are said to account for roughly one-third of the world’s energy. Yet, by implementing effective energy efficiency and conservation measures, this figure can be reduced.

Even if you need your warehouse or factory to be open 24 hours a day, seven days a week, there are ways you can modify your operations to reduce wasted energy by improving energy efficiency and conservation.

We suggest you start with your lighting. It takes a lot of power to illuminate a warehouse or factory, so it’s wise to make the switch to LEDs. LED lighting uses 75% less energy the incandescent bulbs and can drastically reduce utility bills by as much as 90%.

Another method is proper insulation. If your factory or warehouse doesn’t have adequate insulation, then your heating and air conditioning units will have to work double-time to maintain the internal temperature of the building, wasting energy. A good way to identify whether you need to improve the insulation of a given building is to look at your utility bills. A drafty warehouse or factory will mean a higher utility bill. Hence, you can use these bills as a benchmark, to compare the energy efficiency before and after insulation improvements have been made.

Further, employees and managers can make sure that all appliances in the factory machines are shut down when they’re in an idle state. Also, switch machines to an idle state over a ready-to-run state when appropriate. Turning off the power switch is a simple action, but it has the potential to save you a lot of money. Under the assumption that the average electricity cost is $0.07 per kWh, for every 1,000 kWh saved by turning the machine off, you save $70 on your utility bill.

And finally, take a look at smart green technologies to help you save energy. We’re talking about appliances such as smart thermostats, smart plugs, leak sensors, plus ENERGY STAR-rated equipment.

Tip #2: Utilize renewable energy sources

Making the switch to renewables to power operations will reduce the carbon footprint of your factory or warehouse while also providing substantial cost savings. Thinking about the latter, major industrial energy users could cut energy costs by almost one-quarter by switching to renewable supplies. According to research, powering manufacturing using 100% renewable energy could cut costs by as much as 33%, saving large organizations $2.2 billion annually by 2050.

You have a few options when it comes to moving to a renewable energy supply. Your first is installing renewable energy facilities onsite. With this in mind, solar panels are the easiest to maintain and install in comparison to other resources (e.g. hydropower and wind power).

Your other options are to purchase renewable energy from a renewable energy supplier, using either a green tariff, a Renewable Energy Certificate, or a Power Purchase Agreement. For more information read: GHG Protocol: Scope 2 Emissions Explained.

Tip #3: Use alternative and sustainable packaging solutions

Materials used for packaging and storing items are easy to target when working to improve the sustainability of a given manufacturing process or for warehouse storage.

It’s common for factories and warehouses to use non-sustainable materials for both their boxes and the internal packaging used inside these boxes (e.g. bubble wrap and plastic sheets).

Over the course of its lifetime, one ton of corrugated cardboard can release 538kg of CO2e. Recycling lowers these emissions by reducing the need for virgin materials and cutting down the number of steps in the manufacturing process. But this means the materials have to be recycled by the consumer, and there’s no guarantee the consumer will do this.

The solution is for your factory and warehouse to turn to eco-friendly packaging materials. For instance, cardboard can be replaced with eco-friendly plastics such as those made from cornstarch. Cornstarch is an effective plastic alternative made from fermented plant starch. This plastic is biodegradable and comes from a renewable source, unlike oil-based plastics.

Tip #4: Utilize smarter storage options with effective planning

You should also take a close look at how your organization utilizes warehouse and factory space. It’s easy for a large warehouse and factory to become disorganized, and when that happens, pallets and boxes can be placed haphazardly, wasting space.

Pallet racks, industrial shelving, and mezzanines are effective strategies that allow you to store boxes above the ground, freeing up ground-floor space for work. This can give you a better idea of how much space you really need, and whether you’d benefit from moving to a smaller facility.

Tip #5: Optimize production processes and operations

When you have a large operation, you want your factories or warehouses to be working at peak efficiency at all times. Efficient operations tend to go hand-in-hand with greater business sustainability – think about it, efficiency means less organizational waste.

Efficient operations begin with a concrete organizational plan, one that identifies target areas for improvement, while breaking the solutions down into manageable steps, making it clear what the end result should look like.

For a warehouse, this plan could include concrete steps such as using new technology like Artificial Intelligence (AI). AI can make it easier and less costly for warehouses of all sizes to address warehouse optimization challenges, like slotting and workforce planning. AI and machine learning-based solutions give warehouse operators better results than current resource and inventory management approaches, which traditionally rely on spreadsheets.

In addition, thinking about warehouse slotting, we have a complex optimization problem in that there are multiple input factors and competing goals to consider. Plus, there can be thousands of product locations and products (slots) to take into account. AI-based software will learn spatial characteristics, and travel time predictions, while also adapting to condition changes for continuous optimization. The aim of AI, in this sense, is to present the best packaging model.

AI can also be implemented to optimize workforce planning, ensuring the right staff are allocated to meet the work volume requirements. Machine learning and AI can be applied to determine how best to complete work; avoid delays; ensure the most efficient use of labor, and predict labor requirements and work completion times.

Thinking about process and production optimization in factories, you should apply the principles of lean manufacturing. This includes the adoption of methodologies and frameworks such as the just-in-time inventory system, the poka-yoke system, and root cause analysis via the 5 whys. These are popular methodologies built to reduce error and eliminate waste in a system.

Tip #6: Use your factories and warehouses to support a circular economy

Tip #6 is about going that extra mile and participating in a circular economy. This is an economic model where waste products created by one factory are used as resources by another. In this model, factory operations are essential to turn waste into new materials.

Check out Unilever’s reuse scheme as an example. Unilever looks to support a circular economic model by reusing their own waste materials, or by making their waste materials available to others. Unilever’s aim is to get the most possible value from materials through upcycling, and have increased their reuse rate by 20%.

For example, in our Cuernavaca factory in Mexico, we receive raw materials and packaging in cardboard boxes. We found that these boxes can be reused by other industries, such as for transporting snacks around the country. In our UK factories, almost all our cardboard boxes are returned and reused for new packing material deliveries. In 2021, we found several ways to reuse organic waste. For example, sending ice cream waste to animal feed in a number of our markets. In East Africa, we started a pilot that transforms low-grade food waste to fly larvae for a nutritious source of animal feed protein“. – Unilever, Tackling manufacturing waste

Factories and warehouses can also be used to further support a circular economy by processing returns and repairs of unwanted, used, or damaged goods. Patagonia gives the most notable example of this process, utilizing used soda bottles and other waste materials during the manufacture of polyester needed for their products. By doing this, the company has saved up to 13,000 tons of CO2e.

Certify your sustainable manufacturing efforts with the Green Business Bureau

Sustainability is a continuous exercise, where operations are analyzed to consistently find new ways of getting work done in a way that supports our environmental and social systems.

In this article, we’ve given you some useful tips on how to create a sustainable warehouse and green factory. Yet, for a more thorough and detailed guide to sustainability, use the Green Business Bureau‘s EcoPlanner and EcoAssessment, which provide a plethora of green initiative ideas, ordered by cost and impact, allowing you to select the most relevant and effective green solutions for your business.

With GBB, once a green initiative has been successfully implemented, this is displayed on your personalized EcoProfile, which accurately and transparently communicates your green achievements to stakeholders. Once more, you’ll receive certification and your very own Green Seal of approval.

Sign up to the Green Business Bureau today, to improve the sustainability of your factories and warehouses, and to lower the environmental impact of your manufacturing processes.

“Sam Bowman writes about people, the environment, wellness, and how they merge. He enjoys being able to utilize the internet to help communities without actually having to leave his house. In his spare time, he likes running, reading, and combining the two in a run to his local bookstore.”

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