Challenges and Goals in Sustainable Online Retail in 2023

An interview with Ben Lundberg, Supply Chain Manager at Nudie Jeans — a Gothenburg-based denim brand whose environmental philosophy was present even before the first collection was designed. Read on to find out why transparency and sustainability are yet to become industry standards on online retail.

Transparency behind the e-commerce scene — materials, production, deliveries and returns, carbon emissions across the entire supply chain — remains an exception rather than a rule. What are the primary challenges for retailers behind this? When can we expect transparency and sustainable practices to become industry standards?

I believe that the challenges are mainly threefold. It's complexity, costs, and old ways of thinking. 

First, the complexity of the global supply chains simply makes it difficult to create a manageable stream of data that can describe the entirety of the processes. Many retailers have a multitude of partners in each step of the value chain, with different technological capacities, all the way from raw materials and garment producers to the end consumer, who’s also adding value to products.

Second, putting together a supply chain that can provide transparency for both the retailers themselves and the end consumer comes at a high cost. Environmentally conscious decisions with regards to material, design and production unfortunately still cost more than the conventional options to a too big of an extent, and it just doesn’t translate to the revenue side of things.

To be honest though, I’m not sure it should in the short term either; 'sustainability' shouldn’t be a unique selling point — it should be the starting point. Eco-friendly practices in the last-mile delivery and profitability aren't mutually exclusive. Short-term, there, unfortunately, remain financial drivers that create bad incentives, but long-term, there’s no profitability without doing sustainable business.

Finally, the industry is still stuck in old perspectives around secrets being equal to a competitive advantage, either because it limits other actors’ ability to do something similar or because it limits the pressure of accountability from outside forces. Transparency is only possible if you believe that you are more than what you are right now, that you have capabilities and market strength.

Source: Nudie Jeans

The demand for transparency and sustainability in retail is on the rise. What if retailers started charging a little more for deliveries and returns? Not only would it encourage conscious online shopping but also reduce the cost pressure of logistics. What do you think?

I wholeheartedly support any development towards a more conscious online consumption. Cost pressures that become skewed are of course also important to address, but I think that we need to shift the discussion earlier and introduce metrics alongside of monetary aspects that support the future we want to build together with our consumers. We can support such shifts through indirect incentives in the customer journey, but in the end, I think they need to come from a shared baseline of values between all the actors involved in the entire supply chain and the customer.

What core practices retailers can adopt already today to minimize the environmental impact of online shopping? 

There are few quick fixes out there that have potential to drastically change the total impact of a purchased product, but you need to understand what your footprint looks like and prioritize based on that. I do think that most of the time it comes down to the time aspect — slow things down.

What are the steps retailers can take to make the carbon footprint of online deliveries more transparent and achieve some reduction in it? It's not an easy task, considering that combining and visualizing shipping data at all stages of the supply chain requires measurement and reporting from every single stakeholder.

Today, it's a long way to go. First, you need to start incorporating environmentally-conscious practices with descriptive tags, like 'fossil free' in your delivery checkout and so on. Make sure they're not called something generic — the word 'sustainable' doesn’t really say anything.To make it possible, you need to be sourcing partners that take the environmental impact seriously and remain transparent about their stage of the product journey.This way, you help consumers make environmentally-conscious choices and, in other cases, you're able to reveal hard facts about the impact each purchase and delivery choice leaves on the environment.

Join forward-thinking retailers

At Ingrid, we're constantly looking for new ways to support more environmentally-conscious deliveries. We believe that e-commerce businesses and solutions like ours should lead the way, instead of waiting for consumers to start demanding greener logistics. Here's an example.

Nudie Jeans ships to over 50 countries worldwide. They think globally while acting locally. With this approach, entering new delivery markets requires global partnerships and integrations with the best local carriers. To start offering the best delivery options in each area and reduce carbon footprint at every step of the delivery journey, Nudie Jeans needed the right tech solution they could integrate with various systems they already had in place.

By connecting the company's Point of Sales, e-commerce platform, enterprise planning system (ERP) and Ingrid In-Store product into a single omnisolution, Nudie Jeans has been able to leverage their brick-and-mortar stores into local warehouses and fulfill web orders directly store-to-door. Not only has it shortened the delivery time, but also contributed to lowering the greenhouse emissions through more sustainable delivery options for every purchase made.

Today, local Nudie Jeans stores fulfill 30% of web orders in the UK, Australia, Germany, the Netherlands and Sweden, and there are more markets to come.

Want to join and start building a more responsible e-commerce? Book a demo to see how our platform can help you with that — and more.

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