Why A Sustainable Supply Chain Matters

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As the provider of a product, manufacturers rely on a close relationship with their suppliers. It probably won’t come as a surprise that manufacturing plays a major role in the impact on the environment, whether it’s through transport, equipment running and maintenance, assembly lines, or farming practices. As these sustainability issues come to light, there is growing consumer support for the improvement of sustainability within supply chains. There are four main dimensions of sustainability that are important in business strategy – innovation, brand enhancement, strategy and stockholder value, and the impact on costs. As a manufacturer, following the push to become environmentally and socially sustainable can not only improve your carbon footprint, but entice customers and strengthen relations with employees, ultimately benefiting you, your workers, and your customers.


When it comes to your manufacturing inventory, the supply chain is the first aspect that will lead your business to a more sustainable production future. In supply chain management programs and other academic training, sustainability is being woven into the curriculum, highlighting the push for responsible production in all aspects of business. In terms of innovation, manufacturers are creating new ways to manage and track sustainable practices, whether that be in the supply chain, the manufacturing process, or the sales and marketing techniques. Customers are becoming increasingly active in supporting sustainability measures and combining sustainable products with innovative ideas is an attractive way to draw in new buyers.

Brand Enhancement

Not only does sustainability improve the quality of your product, it also has the opportunity to improve consumer relations. When considering manufacturing inventory, you don’t want to solely focus on cost. The quality of a product is just as important to consumers, who become loyal to brands they share ethical values with. Customers aren’t just making buying decisions based on the product function any more, but also on the brand commitment to sustainability. Because of this increased concern with environmental impact, brands are recognising the need to invest in sustainable practices to retain customers and keep up with the changes in our globalised world. An outline of the five steps to building a sustainable supply chain ranks manufacturers in the categories of ‘basic’, ‘improving’, ‘established’, ‘mature’, and ‘leading’. Surveys suggest that most successful businesses are sitting in the ‘improving’ or ‘established’ categories, showing that there is a push for increased sustainability awareness in the corporate sector.

Strategy and Stockholder Value

Regarding the appeal of a manufacturer to investors, it is important to ensure a stable long-term brand image that can keep up with the competitiveness of the industry. When it comes to your manufacturing inventory, the strategic continuity of supply, use of raw materials, and emphasis on natural resources is attractive to both investors and consumers because it shows business prospects for the future.

A key tool for drawing in investors is to be as transparent as possible about supply chain and manufacturing practices and holding accountability for your own sustainability. Enabling trust to be formed between manufacturers and clients leads to more successful company performance. While focusing on product quality is important, it is just as important to show investors their importance to the company in order to retain valuable relationships.

Cost Control

While transitioning to a sustainable supply chain model may be costly initially, it has been proven through other companies that greater sustainability brings greater efficiency. This significant decrease in expenses in the long term is attractive to manufacturers and customers alike, and with the benefit to the environment, all parties gain something from this move towards a sustainable business.

Social Responsibility

Although sustainability tends to be thought of as solely environmentally impactful, there are social responsibilities that are just as important. Issues around human rights, fair labour practices, environmental protection, and anti-corruption measures all play a role in creating a sustainable business. Regarding human rights, ensuring your supply chain promotes equality and fairness is essential in becoming sustainable. Similarly, ensuring adequate working conditions, hours, and appropriate wages to avoid worker exploitation is key to developing a sustainable supply and manufacturing chain. Without prioritising the empowerment of workers, environmental progress through recycling, limited packaging, and optimisation of resources is redundant. Most of this involves sturdy management from those in power, meaning that anti-corruption measures need to be in place to ensure businesses are running efficiently and transparently. While corruption benefits the individuals that are exploiting the money and resources in the short term, it hinders the economic and social development on a wider scale and inevitably leads to irreparable reputation damage that leads to the downfall of businesses.

As a manufacturer, the importance of sustainability in the supply chain offers benefits to your company, workers that may otherwise be exploited, and consumers. By offering a transparent business model to investors and consumers, your brand can demonstrate their commitment to sustainability, ultimately attracting consumers who are now increasingly conscious of their impact on the environment.

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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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