Ready or Not! A New Era of Supply Chain Sustainability

• Wes Bean, Winn-Dixie Stores, Inc.

• Michael Hewett, Publix Super Markets

• Bob Garrity, Sustainability Advisor and Retired Giant Eagle Sustainability Officer

• Jeanne von Zastrow, FMI

• Population -- 3 billion more• Consumption will double by 2050

• Focus on carbon and water footprints

• Transparency / Traceability

• Direct Control & Embedded

What’s the Buzz?

The Essence of Sustainability:

Current Demand:

Emerging Economic Superpowers at No. Amer. Consumption Rates:

Universal Consumption at No. Amer. Rates:

Greenpeace: McDonald's harming the Amazon

By Michael Astor, The Associated Press

Posted 4/6/2006 7:46 PM ET

Tesco invests £500m to create 'green consumer revolution By Susie Mesure, Retail Correspondent Friday, 19 January 2007

Wal-Mart pushes suppliers to ‘go green’

By Allison Linn, Senior Writer Wed., April 18, 2007

UN says eat less meat to curb global warmingJuliette Jowit, Environment Editor Sun, 7 September 2008

Food, Inc.From Wikipedia, the free encyclopedia

U. S. release date: June 12, 2009 Final nominee in 82nd Academy Awards: Best Documentary

Chipotle Makes Most Of Sustainability Spotlight by Karlene Lukovitz  Tuesday, July 14, 2009, 6:43 PM

What do we mean by “Sustainability?”Sustainable development = meeting needs of the present without compromising the

ability of future generations to meet their own needs.

Triple Bottom Line Thinking = Balance between needs of people, planet and profit

FMI’s Sustainability Definition

Business practices and strategies that protect and promote the long term well being of society, the environment and the bottom line.

• Continuous improvement efforts to minimize the environmental footprint of the supply chain, while accounting for the tradeoffs between sustainability goals and other business objectives like efficiency, profitability, or improved customer service.

• Measure & Minimize Transportation Carbon Footprint

– Use of fuel efficient technology such as hybrid trucks

– Route Optimization to minimize deadhead miles

• Packaging Innovations

• Waste Reduction

• Reduction in Energy Consumption

Definition of Green Supply Chain

Green Supply Chain Examples

Logistics & Distribution Decreased total of 2.3M miles equal to

$1.0M fuel savings. Contributing factors: Use of multi-temp trailers Delivery analysis / route optimization Side fairings Intermodal transportation

Innovative Packaging Packaging Improvements – Hamburger

Helper 20% Reduction in carton size 890,000lbs/ year in paper fiber used 20% increase in shelf pack out 500 fewer trucks on the road each year

• Recycling = Revenue: Three FMI Members made close to $50 million in Revenue in 2006 from recycling plastics and cardboard.1

• Loblaw Diverted 1.3 billion plastic bags from landfill cumulatively since 2007. On a single year basis, their customers used 55% fewer bags in 2009 than in the 2006 base year. Additionally, they diverted 58% of store-generated waste from landfill in 2009.2

• In April, 2009, Walmart began purchasing 226 million kilowatt hours of wind energy annually for its Texas stores & facilities. Additionally, they currently have 20 complete solar power installations in California & Hawaii. These systems resulted in the production of 7 million KWh of clean, renewable energy in 2008.3

• Supervalu will sell over 4 million reusable bags this year adding millions of dollars to their bottom line in net margin and reduce their costs on plastic bags.1

Sources: 1. FMI (Food Marketing Institute) Report 2. Loblaw 2009 Corporate Social Responsibility Website 3. Wal-Mart Corporate Sustainability website

Most effective strategies are those that deliver financial value for the company (not PR or philanthropic)

The Sustainability Business Case…

Winn-Dixie’s Partnership with Feeding America is a perfect example of Triple Bottom Line thinking in action

Feeding America / Winn-Dixie partnership 2.9M lbs. donated by the stores and DCs since Jan 09

2660 families fed for an entire year

Creates an opportunity to reduce waste hauling costs.

Could we double the amount of our donations next year and significantly reduce our food waste?

Could we double the amount of our donations next year and significantly reduce our food waste?

Formerly Second Harvest

The Business Case from CEO Perspective

*  "Sustainability is good business -- it helps us become more effective, more efficient and more socially responsible."        Wialliam E. McCracken, Chairman and CEO, CA

 *  "We should view the environment as Katrina in slow motion."        Twenty First Century Leadership,  Lee Scott, Former CEO Wal*Mart, October 24, 2005

*  "Energy, climate change and water also are important issues to our 170,000-plus employees, whose commitment and passion is the basis for our relationship with our guests and ultimately our success."

Clarence Otis Jr., Chairman and CEO, Darden

  

The Business Case from CEO Perspective

*  Based on current projections, the world's consumption of energy is expected to grow 44% between 2006 and 2030, with the majority of that energy provided by fossil fuels, even as lower-carbon alternatives emerge. Energy Information Administration, International Energy Outlook 2009 - World Energy Demand and Economic Outlook, www.eia.doe.gov/oiaf/ieo/world.html

 

*  "Our climate protection initiatives have environmental benefits, but they have business benefits too.  Consuming less energy can reduce our emissions, but it also can reduce our costs.  Integrating green technologies into our manufacturing and distribution processes enables us to better connect with our customers and consumers who increasingly value and prefer businesses and brands that respect the planet we all share." Muhtar Kent, Chairman & CEO, The Coca-Cola Company

 

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Creating alliances between former competitors and/or non-traditional partners to leverage complementary

strengths and solve problems.

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•GreenXchange.com•The Hub•Worldchanging.com•WWF and Coca Cola•EPA and US Food Retail •Greenpeace and Unilever

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Sustainability Strategy: What Defines Success?

• Senior management commitment• Engaged team and passionate leader• Dedicated resources – human and financial• Clear governance, goals and strategy• Embedded throughout company• ROI - Meets triple bottom-line goals• Collaboration with stakeholders

Resources to Help You Save Time and Money

Organizations

Universities, Trade Associations, Government (EPA Smart Way and Green Chill)

World Resources Institute, Green Building Council, Global Social Compliance Program, World Council for Sustainable Development

FMI’s Specific Tools/Educational Forums

Sustainability Starter Kit and Carbon Toolkit with new Calculator, FMI’s Sustainability Web Page = Resources, Coming soon, NEW Assessment and Implementation Tool, New Sustainable Seafood 101, 2010 FMI and GMA Sustainability Summit

Collaborative Industry Initiatives

Produce, Pork, Dairy, Seafood and Meat, Global Packaging Project, Keystone, Sustainability Consortium,

Through the Crystal Ball / Over the Horizon

Increasing focus and collaboration between national and global associations, governments and NGO’s

The Sustainability Consortium advocates for a scientifically grounded process and transparent system, not for individuals or organizations.

Jointly administered by: Arizona State University, University of Arkansas

February 25th, 2010Forks Over KnivesThe Next Food, Inc.?

coming summer 2010

“SMART” Consumption UK government 2060

Know your Water Footprint

Traceability from “cradle to cradle”

Through the Crystal Ball / Over the HorizonAccountability / Transparency: @ Shopper’s Finger-tips

Questions?

Please join us at the Summit in December!