Achieving Real Results with Sustainable Supply Chain Management
Bob DeVosSenior Vice PresidentGENCO Supply Chain Solutions
GENCO – At a Glance… North America’s 2nd largest 3PL
◦ 38,100,855 square feet under management Pittsburgh based, 112 year old, privately held, non-asset-based 2009 gross revenue : $840+ million 130+ operations throughout U.S. and Canada 7,000+ award-winning teammates Over $1 billion in freight managed annually Visibility to $3.5 billion in freight annually Liquidates $6 million worth of product daily The leader in reverse logistics Innovative leader in supply chain technology, R&D and implementation Formal process to provide initial and ongoing value – 6Sigma / Lean
Inbound Vendor Compliance
GENCO’s Supply Chain SolutionSolution Type
Finished Goods to Customer or Distribution
DC Distribution
Returns
Refurbish & Liquidation
Manufacturing / Distribution
Customers/Inter-plant
B to B and B to C
Distributio
n
Customer Direct
Returns
Business Trends
Shipment volume is increasingCapacity is TighteningCarrier Rates going upOcean Carriers - significant increasesCustomers continue to look for cost savingsSustainable Supply Chain Management
Supply Chain Decarbonization Opportunities
Energy Efficient Buildings* Clean Vehicle Technologies* Reverse Logistics / Recycling* Despeeding the Supply Chain* Enabling Low Carbon Sourcing: Agriculture Optimized Networks* Packaging Design Initiatives* Enabling Low Carbon Sourcing: Manufacturing Training and Communication* Modal Switches* Near shoring Increased Home Delivery Reducing Congestion
“Role of Logistics and Transport in Reducing Supply Chain Carbon Emissions”
World Economic Forum / Accenture 2009* GENCO Role
Lighting Control and Retrofit• LightMiser technology• Motion sensitive control
• Retrofit: 8 facilities Hi Pressure Sodium / Metal halide Hi Efficiency Fluorescent
Results:
Saved over 4 million KwH electricity
$908,700 in energy costs saved
ROI 1.6 years
Equivalencies:• 14.9 railcars of coal burned,
2857 metric tons of CO2
• Annual CO2 emissions of 523 passenger vehicles• 649 acres of pine trees to sequester / absorb
annually
Alternative FuelsHydrogen Fuel Cell – Case Study
19% decrease in annual operating costs
Hydrogen-powered Industrial VehiclesLeading the way to mass market
Only byproduct is water and heat
Requires CapEx InvestmentCosts
~$31,000 per Fuel CellFederal Tax Credit thru 2016 ~ 30% of purchase priceIndividual state grant money may also be available
Ohio Third Frontier Fuel Cell Program >$38M; $1M to Crown for lift truck battery replacement researchBottom-line
Pure economics still a ROI challenge – this is changingJustification by productivity improvements and cost avoidance associated with lead/acid batteries
Scenario 2 Results:Minooka, IL; Carlisle, PA; Atlanta, GA and Phoenix, AZ
8
Location Total Weight Total Shipments Plant to DC DC to Customer Variable Cost Fixed Cost Total CostMinooka, IL 163,910,892 12,200 $1,435,894 $6,166,976 $2,012,148 $3,025,554 $12,640,572Carlisle, PA 88,713,543 8,355 $3,180,712 $2,570,024 $991,144 $2,126,728 $8,868,608Phoenix, AZ 85,824,935 7,355 $5,934,803 $3,027,768 $1,034,212 $1,273,789 $11,270,572Atlanta, GA 77,947,210 5,850 $2,011,010 $2,091,323 $795,599 $1,943,372 $6,841,305
Totals 416,396,580 33,760 $12,562,419 $13,856,092 $4,833,103 $8,369,443 $39,621,056
Freight Costs Variable Costs
GENCOSustainability Impact
2009 Savings = 8,271 Tons◦14,019,222 KwH of energy◦39,472 barrels of oil◦237,436,700,000 BTUs of energy◦92,394 cubic yard of landfill space◦69,309 trees◦28,539,000 gallons of water◦1,680 pounds of air pollutants prevented
Green Supply Chain
• Align with business goals
• Set Baseline / Metrics
• Process improvement
• Think holistically
• Plan for the long term
Considerations Benefits
• Reduced wastes
• Reduced health /safety costs
• Better working conditions
• Reduced water, energy, fuel
and transportation costs
• Regulatory compliance
• Enhanced reputation
For more information… “The Lean and Green Supply Chain – A Practical Guide for Materials
Managers and Supply Chain Managers to Reduce Costs and Improve Environmental Performance” - EPAhttp://www.epa.gov/opptintr/library/pubs/archive/acct-archive/pubs/lean.pdf
Green Supply Chain Network – GreenSCM.com Greenbiz.com 2nd Annual Green Supply Chain Summit – April 09 – London
4th Sustainable Supply Chain Summit – March - Brussels GreenSCOR – Supply Chain Council
www.supply-chain.org/
Discussion & Follow-upBob DeVos
Senior Vice President(920) – 593-8942