We have a catastrophising tendency to look at the economic horizon through a lens of powerlessness in the face of global events.
For example, the impact of the war in Ukraine, hangovers from COVID-19 and Brexit in terms of lost productivity and staff shortages, not to mention the soon-to-be double-digit inflation feeding the cost-of-living crisis and hampering our ability to feed ourselves.
Perhaps that’s the problem. Our sense of helplessness is because we are forecasting ahead to a future of uncertainty, rather than looking in the round at how we can take better control of efficiencies in the here and now.
Let me explain. Yes, there are macro-economic factors in play – the volatility of essential commodity costs such as fuel, for example.
However, we have it in our power to dramatically reduce their impact through optimising our supply chains in such a way that bakes in best practice, guarantees less waste and reduces cost and carbon footprints – factors that are already on most business agendas. If this was a retail offer, it would be a two-for-the-price-of-one benefit!
This is where the circular economy – a model of production and consumption that involves sharing, leasing, reusing, repairing, refurbishing and recycling existing materials and products for as long as possible – comes into play in helping us build ‘ECOnomic’ supply chains, powered by sustainable practices which cut unnecessary miles and fuel bills, as well as reducing environmentally-damaging emissions.
This model dismisses the business myth that sustainable practices are by their nature unaffordable. In fact, circular economies significantly reduce costs, boost efficiencies and engender closer collaboration with supply chain partners – a circle of life we cannot afford not to adopt.
Indeed, if necessity is the mother of invention, we will be forever indebted to the circular economy’s parenting skills in weaning us off wasteful single-use materials and linear A-to-B supply chains. That necessity is now because the percentage of the global economy that can call itself ‘circular’ still languishes in single digits. It is time to step up and step out of such narrow constraints.
Ironically, thanks to the efforts of those such as Greta Thunberg and Sir David Attenborough, such sustainable supply chains were becoming serious boardroom talking points prior to the pandemic, as our TV screens were awash with images of plastic waste polluting our oceans.
But the demise of single-use packaging was given a late stay of execution as many of the pandemic-conscious public took a ‘best to be on the safe side’ view of product integrity, in line with hygiene and handling. But the tide is again turning towards how we can do better in terms of price, productivity and the planet.
Swedish teenager Greta argued coronavirus has shown that if governments are prepared to listen to scientific evidence and take action when it comes COVID-19, they must also be prepared to do the same when it comes to the bigger threat of climate change.
Here, the circular economy can be a catalyst for change to reduce pressure on the planet’s resources and eco-systems, as more businesses move away from linear supply chains to models where sustainable materials are continually in use.
In our case, it is pallets that are harvested from sustainable forestry, built and treated in plants using the highest environmental standards. For example, water that is used to steam clean the wood goes back into the brooks and streams of origin cleaner than when it was extracted.
The pallet then serves a long life that involves the ‘three Rs’ of retrieval, repair and repatriation – so that, from the manufacturer to the retailer and the pooler, the asset is in a low-impact perpetual, profitable and circular motion.
We must look ahead, of course. However, we must also look in the round at how we determine our direction of travel to build robust supply chain models which help put food on the table and don’t quite literally cost the earth.
IPP is part of the Netherlands-based Faber Group and supplies approaching 70 million pallets to the FMCG industry every year.
