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What Does Manufacturing Sustainably Mean?

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In an increasingly eco-conscious environment, manufacturers are increasingly accepting the need to adopt sustainable manufacturing practices. To many manufacturers, a greater focus on sustainability is an unavoidable cost; something that needs to be worked into the bottom line. But for savvy firms, sustainability is an opportunity to reduce waste and improve that same bottom line.

What Does it Mean to Manufacture Sustainably?

Unsurprisingly, sustainable manufacturing means different things to different stakeholders. From a purely environmental perspective, sustainable manufacturing means to meet present industrial needs without compromising future generations’ ability to do the same. In other words, avoiding the overconsumption of scarce resources.

In contrast, a balanced perspective might see sustainable manufacturing understood as minimising resource use and environmental impact while recognising the need for production to remain economically sound. This view of sustainability recognises that it must be financially viable for manufacturers to reduce their environmental impact.

Reducing Raw Material Costs

Using less of a scarce input is a sure-fire way to improve profitability and reduce environmental impact. Manufacturers aiming to operate more sustainably might consider reducing their use of scarce resources and rethink the production process. This might come at a large initial cost, although this cost is likely to be offset (at least in part) by a stream of lower ongoing material costs.

Reducing Waste

A major focus in modern sustainability initiatives involves reducing waste. Waste reduction initiatives are both sustainable and economically sound. Shifting to a lean production model can often help a business operate more sustainably; inventory stock is only ordered as the demand arises. This means that less inventory stock is held at any given time, reducing the opportunity for scarce resources to be wasted.

Reducing Energy and Water Consumption

In more and more cities, water is a very scarce resource. Equally, energy consumption has a negative environmental impact in most production locations; not all electricity is produced renewably, after all. Reducing energy and water consumption is therefore a tenet of many manufacturers’ sustainability initiatives. Reducing consumption will be of immediate benefit to many manufacturers, who will enjoy lower energy and water bills from day one. Perhaps more importantly, however, manufacturers who reduce consumption now will be less exposed to the risk of a major increase in either cost in the future.

Access to Government Assistance

Many countries provide incentives to encourage industrial-scale sustainability initiatives. These incentives may include research grants to encourage the adoption of new technology in the manufacturing environment, or tax breaks to reduce the economic burden on companies who choose to operate sustainably.

A Stronger Brand

Environmental sustainability is increasingly becoming a top priority for mainstream consumers. In particular, millennials are often willing to pay a premium price for products that they perceive as ethical and sustainable. Being able to identify particular sustainability measures in your marketing will usually go a long way with these consumers.

Developing your environmental credentials may, perhaps surprisingly, place you in a more competitive position when bidding in response to a tender. Other firms are likely to experience the same consumer pressure to operate sustainably, encouraging those firms to produce and procure sustainably manufactured inventory stock.

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Melanie - Unleashed Software

Article by Melanie Chan in collaboration with our team of Unleashed Software inventory and business specialists. Melanie has been writing about inventory management for the past three years. When not writing about inventory management, you can find her eating her way through Auckland.

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