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Automate the way to greater logistical sustainability

Like many global companies, sporting goods retailer Amer Sports, which includes Salomon and Wilson among its main brands, was looking to improve its sustainability initiatives. The company turned to its logistics business in search of savings on greenhouse gas emissions.

GXO Logistics took the mission to heart and introduced an innovative packaging solution. The Small Order Automated Packaging Machine took 3D measurements of each item and cut the cardboard boxes to fit exactly, reducing cardboard usage by 15%. Installed in Amer Sport’s distribution center in Saint-Vulbas, France, the unit’s precise measurements reduce the amount of carton needed for shipping and allow last-mile delivery vehicles to pack multiple boxes into each vehicle, reducing the costs for delivery and reducing the related emissions vehicles. It also strengthens the corners of each box, further reducing damage in transit and leading to fewer carbon-intensive returns.

It is estimated that more than 165 billion packages were shipped to the United States in 2018, with the cardboard used in those shipments amounting to about 1 billion trees. But a more accurate measurement of boxes is just one example of how contract logistics provider GXO is working to reduce the environmental impact of logistics.

With over 900 warehouses in 28 countries, creating a comprehensive sustainability plan can be difficult, but that’s what GXO did, getting to work on the project last fall just after its spin-off from XPO Logistics (NYSE: XPO) .

Watch: Meagan Fitzsimmons talks about GXO’s ESG efforts

GXO Logistics Inc. (NYSE: GXO) has been awarded an AA rating by MSCI, a global environmental, social and governance company that ranks companies based on ESG initiatives and results. In 2021, GXO has set five environmental goals:

  • 80% of global operations using LED lighting by 2025.
  • 80% of the global landfill diversion rate by 2025.
  • 30% reduction in greenhouse gas emissions by 2030 compared to the 2019 reference value.
  • 50% renewable energy in global operations by 2030.
  • 100% carbon neutral by 2040.

Meagan Fitzsimmons, GXO’s chief compliance and ESG officer, told Modern Shipper that the five goals are just the beginning.

“It’s still an ongoing process,” he said. “We came up with these five goals because they were key goals for us and for our stakeholders. It is certainly not the end of the road ”.

Fitzsimmons said the company engaged key stakeholders to complete GXO’s first materiality assessment and to articulate ESG priorities, outlined in its first ESG report, released last month.

“We are now developing an ESG scorecard for greater accountability and to focus our resources where they will have the greatest impact,” Fitzsimmons wrote in the ESG report.

The role of automation in sustainability

While much attention to sustainability is on efforts that can be easily measured, such as vehicle emissions, Fitzsimmons said automation offers many environmental benefits. With over 200 million square feet of warehouse space, finding ways to improve efficiency is key to generating value for GXO customers and continuing to grow revenue. dollars in 2021). The addition of robots improves worker productivity between 4 times and 6 times and the company is able to increase shipments by 5 times, he said. Overall work efficiency improves between 5% and 7% when machine learning is applied.

These are areas that can foster greater sustainability and are often overlooked by companies.

In 2021, 37% of GXO’s owned or leased facilities globally were ISO 14001 certified and its logistics center in Trecate, Italy will become the first LEED v4 Platinum certified warehouse in the EU. Global Scope 1 and 2 emissions have decreased by 13,624 tons of CO2e since 2019, and the intensity of emissions has decreased by 16.7 tons of CO2e per million dollars of revenue, or 26 percent, since 2019, he said.

Inside warehouses, 47% of floor space in the US and Europe uses energy-saving LED lighting.

In the case of GXO’s ESG goals, Fitzsimmons said many of them match customer initiatives.

“It’s really a partnership and what’s very exciting for many of the clients we have is that we work closely with them,” he said. “We work with many of the largest companies in the world and they have their own sustainability initiatives. I understand from our customer team that every conversation they have contains some element of ESG. “

Fitzsimmons said there are some efforts, such as box size reduction, lighting installation, or waste reduction that provide demonstrable examples of sustainability, but for GXO it’s also about creating a committed workforce.

Promote employee involvement

“We are really finding that yes, we have a lot of focus on automation and technological innovation … but it’s really enabling our employees to work more collaboratively and get involved,” he noted. “It’s really about increasing productivity and reducing the time it takes to bring that good to the person’s home.

“The engagement piece is extremely important,” continued Fitzsimmons. “It is involving people. It is diversity, inclusion and belonging. That’s how we put it at GXO. Everything contributes to employee involvement. “

In e-commerce, warehouse space is precious, but so is the ability to get items to the final consumer quickly. GXO offers GXO Direct, which has its own sustainability component. The offering allows freight forwarders to take up space in a multi-user warehouse, which allows them to move goods closer to the customer and reduce vehicle emissions, accelerating delivery times.

Automation also plays a key role in the reverse logistics operation. Globally, nearly 35% of online orders are returned and 25% of those are sent to landfills, GXO said in its report. In the Netherlands, Xerox used GXO’s approach to reuse or recycle 90% of its returns and in France, a GXO facility in Satolas-et-Bonce was able to reuse polystyrene packaging, transforming 134 cubic meters of plastic in reusable plastic and reducing carbon emissions by 54%.

Reduce landfill waste

One of the goals set by GXO was to reduce landfill waste by 80% by 2025. At the time of measuring the data for this report, GXO had a waste reduction of 79%, well ahead of its initial goal. Fitzsimmons said some sites are close to zero waste thanks to recycling and reuse programs. Others still have progress to make.

“We are certainly focused on continuous improvement, so we will not go to 80 and we will stop,” he said. “We have been more successful in some locations than others.”

In the report, GXO CEO Malcolm Wilson said there is an opportunity for GXO to have a positive impact on the environment.

“Our fresh start offers a rare opportunity – and responsibility – to create a strategy around what matters most to our employees, customers, investors and communities. That means leveraging technology to not only improve profitability and performance. but also to minimize our environmental impact, create a safe and welcoming workplace and do business the right way, “he wrote.

Fitzsimmons said that moving forward, GXO sees ESG as a journey that not only includes greater automation, but also engaging employees to develop solutions and efficiencies that offer more subtle environmental impacts that add up to large impacts.

“We are at the beginning of our journey, we are not even a year old. I think it’s a good start, “said Fitzsimmons.” We are continuing to put together new goals, new strategies and new road maps to achieve new ones. [sustainable heights]. “

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