In today’s highly competitive environment, green logistics issues are gaining interest. Nevertheless, it is not easy to find literature references on this topic (Richardson, 2001). In fact, the literature review shows that this topic was not discussed until 1990 (Srivastava, 2007), when green logistics was considered as a relevant social and economical issue. This paper mainly focuses on studying how companies can have positive environmental effects by making some operational changes in their logistics system. There are different perspectives and theories to approach the topic, but there is a lack of research into case studies. Therefore, further research into case studies is necessary to validate those theories (Aronsson and Brodin, 2006). For that reason, this paper uses an example of a case study to discuss how green practices can achieve both economic and environmental objectives.
Since the early 1990s environmental regulations and consumer pressures have encouraged many companies to add the environmental component to supply chain management (Wu and Dunn, 1995). In the past, organizations divided responsibility to ensure environmental excellence among activities in product development, process design, operations, logistics, marketing, and waste management. Currently, trends call for integration of environmental management with ongoing operations (Srivastava, 2007). This not only increases complexity in the chain but also may equally lead to conflicting interest between economic and ecological requirements (Ebinger et al., 2006).
Environmental issues can impact on numerous logistical decisions throughout the supply chain such as location, sourcing of raw material, modal selection, and transport planning, among others (Wu and Dunn, 1995). Most researchers seem to be worried either about exploring ways to achieve environmentally sustainable logistics practices and about determining strategies considered as most cost-effective for managing and responding to environmental issues in logistics. Therefore, decisions regarding these activities at strategic, tactical, and operational level will determine the environmental impact (Quariguasi Frota Neo et al., 2008). Nevertheless, there are many cases in which effects of changes at operational and tactical levels clash with objectives at a strategic level (Kohn and Bodin, 2007).
In this paper, we concentrate in transportation, which is one important aspect at the operational level of green logistics. The activity of transport causes a high rate of negative effects on the environment, such as pollution, noise or congestion. Thus, an efficient use of transport resources, which aimed at the selection of vehicle types, the scheduling of deliveries, consolidation of freight flows and selection of type of fuel, among others, can help to mitigate these problems. Nevertheless, these decisions also represent company strategic responses to a set of factors such as external influences, company demographics (size and nature of business, and internal policy) and available technology (Kam et al., 2006).
Different authors have suggested a set of environmental practices that focuses specifically on logistics both from the purchasing management (Carter and Dresner, 2001 and Bowen et al., 2001) and from supply chain perspectives (Zhu and Sarkis, 2004 and Sheu et al., 2005), where transportation is one of the aspects taken into account. Included here are measures aimed at prioritising shipment consolidation in planning and programming of flows, and at choosing less polluting forms of transportation, among others (McKinnon, 2000, Schade and Schade, 2005 and Zachariadis, 2005). Also there are other authors who focus their research on evaluating the external effects of transport to internalise them through taxation (Bickel et al., 2006, McKinnon, 2006 and Ubeda et al., 2006). As a result, companies would have to absorb those extra charges into fleet costs, thereby enhancing their motivation to find ways to reduce their CO2 emissions.
This paper studies the decisions made at an operational level to reduce the environmental impact of transport activities at Eroski Group (hereafter referred as Eroski). It discusses ways to optimise its fleet efficiency and examines the impact of those practices on the profitability of its operations and on the environment. This is followed by a description of a methodology to design green transport routes. The paper finally presents some concluding comments and suggestions for further research.
The present study shows the potential of the introduction of green practices in logistics management. On the one hand, the minimisation of distances and pollutant emissions associated to the introduction of changes in transport planning shows the importance of optimising operations. In this case, Eroski would improve its efficiency objectives both from economic and ecological perspectives. Furthermore, it should be noted that when introducing backhauls to avoid empty-running, benefit from both perspectives are greater (see Table 4). Thus, an issue for further research is to analyse whether it is better to spread out the supplied products evenly throughout the week. On the other hand, if the group incorporates changes into their transport activities, there may be a reduction of fleet size and, consequently, vehicle filling rate will be increased as well as the number of nodes visited by each vehicle. Thus, it will be difficult to minimise postponement effects and keep scheduling deals. For these reasons, Eroski is expected to negotiate with customers and suppliers for new distribution timetables. Furthermore, increase on its fleet capacity would also allow Eroski to satisfy their customer demands without too many upheavals. Nevertheless, this could be studied in depth in further research.
Also, Eroski would probably have to incur some extra costs related to those changes aimed at cutting their negative environmental effects. Furthermore, the environmental care improvement will also give them some competitive advantages, and in case of charging policies appearance also profits. In fact, they may quantify the best level of pollution impact for their own logistics system. The application of the environmental methods shows how fleet planning may balance total pollution and total costs, in terms of vehicle utilisation rate and distances, in a more effective way. Furthermore, since it would be better to visit first those nodes with a higher load/distance rate, changes in the location of delivery points and depot may change the differences between both approaches (Sections 3.2 vs. 3.4).
Finally, the same approach and methodology may also be applied to other cases and companies to evaluate the accuracy of the conclusions shown above. Further research may also lead to the finding of cleaner routes, through the development of better algorithms such as tabu search methods and/or alternative ways to develop the environmental matrices (eij). These simple modifications may lead us to calculate the emissions more accurately and to facilitate the search for cleaner routes, thereby yielding greater differences in CO2 emissions between the distance and emission minimisation approaches. Further work on quantifying some of the exogenous factors alluded to earlier, is also in order. As an example, Eroski intends to incorporate global position system (GPS) technology in its fleet, which may help standardising driving styles.
The study of these and other issues justifies additional research.
